Suppliers, being one of our key stakeholders, form a critical part of our business success. We firmly believe in establishing mutually beneficial relationships by selecting partners who align with our values, business ethics, and commitment to sustainable practices. We have a strong global network of suppliers spread across many countries including Australia, Indonesia, South Africa, USA, Germany, etc. During the reporting period, 100% of our inputs were sourced sustainably. Around 5.58% of our input materials were sourced directly from MSMEs/small producers and 67.2% of total procurement from MSMEs/small producers were sourced from within the district.

Supplier Code of Conduct (SCOC)

Our supplier code of conduct is based upon internationally accepted and advocated principles of human rights, labour, environment, ethical and fair business practices as described in United Nations Global Compact (UNGC). It serves as a guiding framework for all our supply chain business partners, including suppliers, contractors, consultants and agents, ensuring their compliance to the principles set out in the policy. All our suppliers are expected to comply with all applicable laws and regulations and prohibit child labour, forced or compulsory labour, discriminatory practices, harassment, promote freedom of association among workers and ensure fair wages and working hours. As a part of our commitment to promote sustainable sourcing, we conduct periodic assessments of our suppliers to assess their compliance with legal, behavioral, health and safety, and other essential norms of SCOC.

 Click to read Supplier Code of Conduct.

Supplier Evaluation and ESG Risk Assessment

We have taken proactive steps towards ensuring a sustainable and responsible supply chain through the initiation of a supply chain assessment programme for critical suppliers. Occupational Health & Safety (OHS) criteria have also been embedded into procurement and contractual requirements to ensure supplier compliance with workplace safety standards Implemented in phases, this program aims to thoroughly evaluate and enhance the sustainability practices of our suppliers and business partners. Our supplier risk identification process helps us in identifying associated potential and actual ESG risks which are material to our supply chain, during two stages: on-boarding of new suppliers and evaluation/re-evaluation of the identified critical suppliers. . All our contractors are mandated to undertake safety trainings and wear safety gear suitable for the work environment before commencement of their work at plant locations. The executive management is responsible for the oversight of effective implementation of the supply chain assessment programme which helps us in making informed purchase decisions.

We have launched a comprehensive supply chain assessment programme targeted at critical suppliers consisting of a systematic assessment of suppliers through structured questionnaires. Rolled out in a phased manner, this initiative is designed to methodically evaluate and elevate the sustainability standards of our suppliers and business associates. Through systematic assessments, we pinpoint areas for improvement, foster transparency, and catalyze positive transformations throughout our supply chain. This continuous programme aims to cultivate a resilient and socially aware supply chain that mirrors our principles and drives toward a sustainable future. We have initiated a supplier desk-assessment wherein suppliers were requested to provide relevant information on their performance, adopted policies, and practices. Traditionally, on-site assessment of suppliers by JSW Steel employees was only for quality assurance, however, we have included an ESG criteria in our supplier assessments for some of our suppliers. We have developed our own supplier assessment questionnaire based on various nationally as well as internationally recognised standards, frameworks and methodology.

Our total procurement spent in FY 2024-25 amounted to INR 1,01,651 crores from 11,453 suppliers (this number includes small, medium, and large scale suppliers - fulfilling capex, opex, raw material, and services needs) around the globe, who are all Tier-1 suppliers. These suppliers were assessed on various ESG parameters including but not limited to Climate Change, Resource consumption, waste management and Human Rights.

Supplier ESG Assessment Summary – FY 2024-25

• Total Tier-1 suppliers: 11,453
• Significant Tier-1 suppliers: 129 (accounting for 75% of total spend)
• Significant non Tier-1 suppliers: 170
• Total significant suppliers (Tier-1 & non Tier-1): 299
• Significant suppliers assessed (desk or on-site): 263 (87.95% of unique significant suppliers)
• Suppliers with substantial actual/potential negative impacts identified: 24 tier-1 suppliers and 0 non-tier 1 suppliers
• Corrective action/improvement plans implemented for 100% of impacted suppliers
• No terminations due to negative impacts during the year
• All impacted suppliers supported in corrective action plans (24)
• Capacity building programs included all significant suppliers (299), achieving 100% participation

The assessment process is being conducted in phases, and will be ongoing for the next 2-3 years.

Our ‘significant suppliers’ are classified in terms of business relevance to the Company. Furthermore, in the screening process for significant suppliers, we take into account risks for negative ESG impacts related to a country's political, social, economic, environmental, or regulatory situation along with sector-specific risks and commodity-specific risks such as emissions, energy consumption, human rights, biodiversity, etc.

Based on the assessment result, we support suppliers to establish improvement or corrective action plans, and plan to conduct continuous monitoring on the improved outcome. We have set a minimum requirement that suppliers must comply with for contract awarding. Suppliers who are unable to meet expectations within a specified time frame will be temporarily excluded from the list of potential suppliers until they achieve compliance. 

A total of 263 suppliers are being assessed – and currently ~9% of them have been identified as having substantial potential environmental and social impacts, following which they have been provided with corrective action plans. Once our supply chain assessment progresses substantially, we plan to subsequently engage with our supply chain partners receiving a high risk rating, and support them in the implementation of agreed corrective and preventive action plans.

As part of our Supplier Code of Conduct - we preserve the right to take necessary corrective actions at our sole discretion that may include, but not be limited to, capacity building of the suppliers to take remedial measures, allowing a time as deemed fit by us for the same, or termination of business relations with the concerned suppliers. However, currently no suppliers have been terminated on the basis of identified actual/potential negative ESG impact.

Purchasing practices towards suppliers are continuously reviewed and monitored to ensure alignment with the Supplier Code of Conduct and to avoid potential conflicts with ESG requirements.

Promoting Growth through ESG Education and Awareness

In order to strengthen the supplier assessment program and promote understanding of ESG among suppliers, we conducted awareness programs. The topics of the ESG awareness program covered emissions management, energy security, water security, circularity, safety, etc. During FY 2024-25, 100% of assessed supplier were covered under the training programs. Moreover, we conducted awareness sessions for internal stakeholders responsible for managing the purchase related decisions, covering senior management and concerned employees. We will strive to continue to increase ESG awareness among our suppliers and employees.