Responsible product
We believe that manufacture at a global level starts with respect towards people and the environment.
We work with suppliers who share our commitment that products be manufactured in a responsible and sustainable manner.
Our focus
Our mission is to make effort to do everything possible to expand human potential. We do this by creating ground-breaking technological innovation thanks to manufacturing our products in a more sustainable way, building a creative and diverse global team, and positively influencing the world in which we live and work.
CAG Electric Machinery s.r.o. based in the Czech Republic manufacturing electric and technical products under the CAG brand.
Compliance with the manufacture code
We believe that manufacture at a global level is based on standards that respect the environment, people working in factories and the principles of a safe and healthy workplace.
Fair
evaluation
We focus on the development of evaluation programs that will boost employee involvement, increase compensations and improve social dialog.
Environmental
protection
We work with suppliers who share our commitment for zero compromises in terms of the environment and focus on reducing our joint impact on energy and emissions, waste, water and chemistry.
Industrial innovation implementation
We cooperate with a wide range of parties involved in addressing system issues and improving results for workers and their communities.
Building relationships with our suppliers
We build long-term relationships with our contractual suppliers because we know that trust and mutual respect support our ability to create products more responsibly, speed up innovation and better serve our customers. More than 90 % CAG products are manufactured by factory groups with which we have been cooperating for more than 15 years.
Motivating suppliers to continuously improve performance and sustainability
We support the improvement of sustainability through the CAG system code that evaluates the supplier’s performance in terms of quality, delivery, costs and sustainability. We also have tools that take into account the growth and potential in management, operations, innovation, product creation and sustainability. We use this information for our long-term strategy of supply and increasing trading with the best-performing suppliers.
Support of suppliers in meeting our standards
We help our key suppliers promote sustainability by providing resources that create a greater transparency and predictability. Strong and long-term relationships of CAG with suppliers help us create innovative products in a responsible manner. Our approach also supports better results for our suppliers, the people working in our supplier chain and the planet.
Manufacturing standards
System code
CAG has a long-term commitment to cooperate with suppliers on improving manufacturing conditions and minimizing negative impacts on workers and the environment. To unify the requirements for our suppliers, we have prepared a comprehensive system code that determines practical procedures of manufacture so that the results of our partners maintain the growing potential. Each supplier plant that manufactures products for CAG must meet a strict set of requirements for compliance. The CAG system code determines the minimum required standards we expect of each supplier or plant.
Supplier approval
All potential new suppliers are subject to the new source approval process. We consider the risks of establishing a new supplier relationship. Before commencing full production, suppliers must receive an overall assessment at the level of the orange audit – our minimum acceptable level.
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Insufficient |
Unstable |
Sufficient |
Excellent |
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Serious shortcomings or failure to return to the compliance of remedy plans |
Ongoing improvement process. The supplier is still unstable. |
The basic level of fulfilling the CAG system code. Certified supplier. |
Leader of the sector. A comprehensive implementation of the CAG system code. |
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Insufficient |
Unstable |
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Serious shortcomings or failure to return to the compliance of remedy plans |
Ongoing improvement process. The supplier is still unstable. |
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Sufficient |
Excellent |
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The basic level of fulfilling the CAG system code. Certified supplier. |
Leader of the sector. A comprehensive implementation of the CAG system code. |
System compliance verification
The CAG manufacturing index that was introduced in 2011 evaluates factories on the basis of four categories of the same importance: sustainability (including work procedures) and three conventional manufacturing metrics (costs, quality and timely deliveries). We evaluate the sustainability component through our sustainable manufacture and supply index and focus on bringing all plants to the orange assessment level (our minimum standard) or higher. We change production performance through our code. The achievement of the orange assessment demonstrates the basic compliance with standards that respect the rights of workers and create a safe working environment.
Program to ensure compliance with the manufacturer’s regulations
CAG monitors the compliance with the rules of the system code via regular and unannounced audits. These are carried out by internal and external parties. The ratings that are the result of the evaluation constitute the basis of the supplier score. We thus motivate well-performing enterprises to improve, and initiate sanctions in the case of suppliers who do not meet the expectation of the minimum quality score (orange rating). In this way, we prompt suppliers to fully comply with the principles of conduct and standards of the system code of CAG.
Remedy
CAG takes issues of non-compliance seriously. If we are notified of an issue of non-compliance with our system code or standards, we investigate immediately and take remedial measures together with the factory managers.
If the supplier fails to remedy the issues identified by the audit or as required by CAG, that supplier shall be subject to review and sanctions, including the possible termination of the supply contract.
Responsible sale
In the event we terminate the relationship with the existing supplier, whether due to poor performance in terms of sustainability or for other reasons, a responsible process of CAG withdrawal is initiated. This involves an evaluation of risk for our customers.
We take this process seriously. It involves the reduction of production contracts for a determined period of time in order to ensure the lowest possible disruption of the business and workers. In situations with a high risk, we establish work groups composed of many parties involved that prepare and monitor a withdrawal plan designated to manage the risks associated with the termination of cooperation.
