Every year, NS purchases goods and services for an average of 1.1 billion euros (2020: 1.1 billion euros). In 2021, we had ties with over 3,000 suppliers in 22 countries. Of our total purchasing volume, we obtain 80% from 117 suppliers; the largest share of that volume (97%) originates from the Netherlands and other countries in Western Europe. Purchased goods and services mainly include staff, financial and facility services, IT, construction, communication, energy, trains and transport.
Through its supplier policy, NS uses its position as a purchaser to encourage suppliers to make their products and services more sustainable. In this way, we make our suppliers contribute to our sustainability objectives. We have included our CSR requirements in the procurement governance rules and embedded them in our General Terms and Conditions of Purchase (www.nsprocurement.nl/en/) and in our Sustainable Third-Party Policy. We work closely with our suppliers and challenge them and other market players to submit innovative and sustainable bids. We use the following initiatives to steer procurement:
Embedding sustainability in procurement through tendering plans
One permanent consideration in our European tendering procedures is to include suitable sustainable selection and award criteria. Some examples:
In addition to the requirement to make NS's energy consumption fully sustainable through the use of Guarantees of Origin, the tendering procedure for facility energy services now also includes wishes concerning the joint development of actions aimed to achieve zero-emission electricity consumption.
The current tendering procedure for operational staff uniforms includes requirements and wishes with regard to the circular use of raw materials, return flows, recycling, zero-emission enterprise and social return.
One of the award criteria in the tendering procedure for the transport of rolling stock was the availability of zero-emission services. The result is that the transport will be carried out using electric locomotives as much as possible, instead of diesel-powered locos. The intention is to use a hybrid locomotive with a battery from 2022.
Sustainable Third-Party Policy
Through our Sustainable Third-Party Policy, we encourage our suppliers to make their products and services more sustainable. We ask them to help us explore opportunities for zero-emission, circular, green and socially responsible business practices. In 2022, NS will launch a renewed policy for sustainable purchasing linked to the company's overall strategy. This will allow us to set clearer objectives in weighing sustainability targets against other targets.
Supplier assessments and Code of Conduct
We subject our major suppliers to a Corporate Social Responsibility (CSR) assessment. The parties represented in the Railsponsible sector initiative jointly agreed on using Ecovadis as the standard for this purpose. The assessment covers the supplier's environmental impact, its labour and human rights record, its integrity and sustainable procurement. The required minimum score for this assessment has been gradually raised from 35 points in 2018 to 50 points in 2021.
Through our Code of Conduct, moreover, we expressly communicate to our suppliers the CSR standards and values that we apply to doing business with them. In cases of non-compliance with the Code, we enter into a dialogue with the supplier concerned and ask them to produce an improvement plan. In cases of serious violations, such as corruption, we will terminate the relationship.