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Group Procurement

The production of goods and the provision of services in our supply chain should take place under comparable conditions to those prevailing in our own company. We require partners in a business relationship with RWE to accept the principles of our Code of Conduct as a basis for cooperation. This is implemented by incorporating the principles for behaviour included in the RWE Code of Conduct into the contractual relationships. Our principles for behaviour address issues including human rights, labour standards, the environment, anti-corruption, and money laundering. The procurement conditions are managed centrally by Group Procurement.

Group Procurement is assigned organisationally to RWE Power AG, reports to its Chief Financial Officer and provides procurement services to all RWE Group Companies. The basis for procurement activities is provided by our Group Directive Procurement. This defines uniform principles applicable throughout the Group for carrying out procurement.

The compliance rules and principles must be complied with for all procurement transactions alongside the RWE Code of Conduct. The supplier or service provider is obliged to adhere to these regulations. We review business relationships with business partners if it becomes known in the public domain that they have breached the principles of the UN Global Compact. We then take appropriate measures that we consider necessary and put them into action. For example, when deploying employees from subcontractors it is important to observe the aspects of labour law pertaining in the individual country of deployment. A risk assessment for specific product groups is used as a basis for the regulations to be observed by suppliers and they are explicitly agreed in separate contractual clauses.

Supplier management is a key building block within the strategic procurement process for Group-wide procurement. One of the objectives of supplier management is to safeguard and improve the supplier service and to identify and manage supplier risks. If there are any problems in relation to the business relationship, we involve our suppliers and work together with them to generate improvements. For example, we have implemented an escalation process for incidents in the area of occupational safety in order to develop suppliers. Business relationships can also be terminated if there is a repeat and depending on the severity of the incidents.

RWE Supply & Trading GmbH

Our subsidiary RWE Supply & Trading GmbH acts as the commercial centre for the RWE Group. Its core business, energy trading, forms the economic link between the elements of our value chain, the regional markets and the various energy commodities. RWE Supply & Trading concentrates on trading in electricity, natural gas, coal, oil, CO2 certificates and biomass. It acts as the interface between the RWE Group's operating companies and global wholesale markets for energy and energy-related raw materials in both physical and/or derivative forms.

RWE Supply & Trading operates a number of internal policies to ensure that we are conducting business in an ethical and transparent manner.

Counterparty Approval Process (CAP)

The RWE Group Code of Conduct sets out our expectations of how we work, the standards for collaborating with contractual partners and the common basis on which to build contractual relationships. Each supplier is screened through the RWE Supply & Trading “Counterparty Risk Assessment”. Each supplier is screened for adverse media events and investigated when they arise. The screening and further investigations are completed by our compliance team. This process also sets a review deadline based on the risk associated with the counterparty. This is a continuous process to ensure checks are ongoing not only at the start of the relationship but throughout the commercial engagement.

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Counterparty Approval Process (CAP)

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