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Jun 1, 2023
Ecopetrol seeks to contribute to communities´ development through good social management practices implementation with a main local focus and sense which allows the shared value creation, suppliers´ development and communities´ growth. Therefore, the Supply Chain counts with the following mechanisms:
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PROCUREMENT OF LOCAL GOODS AND SERVICES STRATEGY: Looks to positively impact the regional economies under the principles of legality, reasonable prices, transparency, plurality, competitiveness, free and fair contention, and equitable inclusion.
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LOCAL EMPLOYMENT STRATEGY:
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Local labor hiring: Ecopetrol acts in accordance with Decree 1668/16 that establishes for hydrocarbon exploration and production projects, 100% of unskilled labor must be local and, if any, at least 30 % of the hired skilled labor must reside in the area of influence of the respective project.
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Inclusive labor linkage: Promote the linkage to formal and decent jobs of difficult labor insertion population groups by Ecopetrol’ s suppliers, through a set of incentives related to the assignment of scores in election methods and a recognition that accredits them as Inclusive Suppliers of Ecopetrol Group.
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DIVERSE PRODUCTIVE ENTREPRENEURS CONTRACTING: Support the incorporation of regional productive ventures in the supply chain of the Ecopetrol´s Business Group and empower companies (of different industrial sectors) pertaining to, or with hiring, of difficult insertion population.
Based on the commitment to Local Development, Ecopetrol, whit the support of Los Andes University, launched the first training cycle “Crecer País”, which seeks to promote the co-creation and innovation among Ecopetrol´s suppliers, strengthening business relations through non-commercial ties. This first cycle was based in two training workshops on sustainable supply ecosystems and counted with the participation of 209 national suppliers. Ecopetrol also got into a free agreement with Tec4Training, a training platform, which allowed the certification of 75 entrepreneurs. In addition, Ecopetrol has introduced in the Operation and Maintenance procurement strategies contractual obligations for technical and professional training framed at local content requirements; at the central region training programs on industry cross-cutting topics have been developed for people with disabilities. At the Caribbean region, a local supplier trained and hired 14 women on scaffold techniques for one of the refinery contracts.
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Procurement of local goods and services strategy:
Acting in accordance with Ecopetrol’ s Supply Chain Operative Model and the regulatory regime that applies to it, the assignment of contracts is carried out within the framework of Selection Methods as defined in the Procurement Manual. Due to the main social focus and responsibility, the Company favors and promotes the local contracting of goods and services in the areas where it operates both directly and through its contractors. For which, it developed the Local Goods and Services Strategy that promotes sustainable growth and the competitiveness of local suppliers in the market.
The principles for goods and services contracting are:
The procurement strategies, the contracting processes, as well as the participation of the interested parties in them, must be developed in strictly compliance of the applicable legal provisions.
The supply chain process must be preceded by high standards of ethics and transparency, rigorously applying the rules set forth in Ecopetrol’ s Code of Ethics and Conduct and the recommendations issued by control entities.
The suppliers´ plurality in the market and free competition are key essential factors of goods and services contracting. Plurality is one of the characteristic elements of Ecopetrol’ procurement processes and an unavoidable principle to apply in the local contracting strategy. It is important to mention, that if there is no plural offer available in the territories, the supplier´s origin scope will be extended from local, regional, national until reaching the international market.
Ecopetrol contracts with the best suppliers, according to supply needs and compliance with the supplier profile in aspects such us capacity, expertise, performance, excellence in processes, among others key factors.
The process has measures to preserve the reasonableness of rates or prices under market conditions. Consequently, Ecopetrol´s suppliers and its respective subcontractors (if applicable), will ensure that all the commercial relationships made with local suppliers are characterized by achieving reliable prices and in conformity with real market conditions.
Giving application to article 333 of the Political Constitution, all suppliers must compete correctly in the market, without hindering the competitive position occupied by other parties and without altering the freedom of contractual decision making. Therefore, the suppliers must refrain from executing acts of unfair competition or engaging in restrictive practices.
Under this framework, Ecopetrol has defined the Local Contracting Strategy, which aims to positively impact the regional economies:
Principles
Legality
Etics and Transparency
Suitability
Plurality
Free and fair competition
Reasonable prices
Equitable Inclusion
The local procurement analysis and monitoring includes the contracting performed by Ecopetrol’ s suppliers, in which, the companies´ technical freedom and administrative autonomy is respected and they are the ones who, from a private commercial law view and according to their needs, enter into commercial agreements to acquire the necessary goods and services. However, to generate greater local business participation in contracting, Ecopetrol perceives its suppliers as key actors for the sustainable development in territories, this without any prejudice of suppliers´ technical and administrative autonomy and the local offer identified must comply the principles of free competition, plurality, suitability, and transparency set by Ecopetrol.
To promote the local development, Ecopetrol´s suppliers are commited to:
CLEAR RULES AND PRINCIPLES: FREE COMPETITION, TRANSPARENCY, FAIRNESS, SUITABILITY, AND COST EFFICIENCY.
MINIMUM REQUIREMENTS: LEGAL, TECHNICAL, FINANCIAL, HSE CAPACITY, AMONG OTHERS
COMMERCIAL RELATIONS WITH FORMAL AND LEGALLY CONSTITUTED ENTREPRENEURS
TIMELY PAYMENT
FORMALIZED COMMERCIAL RELATIONSHIP: CONTRACT OR EQUIVALENT DOCUMENT
REPORT ALL CONTRACTING OF GOODS AND SERVICES EXECUTED
REPORT ILLEGAL ACTIVITY TO THE COMPETENT AUTHORITY
PARTICIPATE IN BUSINESS MEETINGS WITH LOCAL COMPANIES
PROCUREMENT OF GOODS AND SERVICES WITH COMPANIES OF THE MUNICIPALITY OR REGION AS A PRIORITY
PROVIDE INFORMATION ON NEW CONTRACTS THAT REQUIRE LOCAL GOODS AND SERVICE
MINIMUM REQUIREMENTS: LEGAL, TECHNICAL, FINANCIAL, HSE CAPACITY, AMONG OTHERS
DO NOT COMMIT ECOPETROL INTO AGREEMENTS WITH COMMUNITIES OR AUTHORITIES
Local Employment Strategy
Ecopetrol, through its internal labor regulations in contracted activities, indicates the labor standards that all suppliers must comply with their workers when carrying out activities for the Company. Through this policy, the commitment to respect all human rights is made explicit, with special consideration of:
Dignified, favorable and adequate working conditions.
Freedom of union association and collective bargaining.
Equality in employment and occupation.
Abolition of any form of child labor.
With the aim of promoting local hiring, the local employment strategy has been developed:
Principles
Legality
Etics and Transparency
Suitability
Plurality
Free and fair competition
Reasonable prices
Equitable Inclusion
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Prioritization of skilled local labor:
Once Ecopetrol achieved the stabilization of 100% local labor (established in the applicable legislation), the company has established a greater goal of awareness and promotion of skilled local labor employment allowing a greater involvement of technicians, technologists and professionals which impact directly the wellness of communities of operation.
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Inclusive employment:
Recognize Ecopetrol´ s suppliers that are committed with the employment of population that has historically faced barriers to access to formal and decent jobs encouraging non-discrimination practices not only during the hiring but also in the integral work environment.
The materialization of the inclusive employment initiative implied the creation of regulations, training for the supply chain officials and support of state entities such as the Ministry of Labor and the Public Employment Service.
Additionally, and aiming to support the local development, at corporative level, Ecopetrol, in alliance with Los Andes University, launched the first training cycle “Crecer País”, which seeks to promote the co-creation and innovation among Ecopetrol´s suppliers, strengthening business relations through non-commercial ties. This first cycle was based in two training workshops on sustainable supply ecosystems and counted with the participation of 209 national suppliers. Ecopetrol also got into a free agreement with Tec4Training, a training platform, which allowed the certification of 75 entrepreneurs. In addition, Ecopetrol has introduced in the Operation and Maintenance procurement strategies contractual obligations for technical and professional training framed at local content requirements; at the central region training programs on industry cross-cutting topics have been developed for people with disabilities. At the Caribbean region, a local supplier trained and hired 14 women on scaffold techniques for one of the refinery contracts
Diverse productive enterprises
Through this program, Ecopetrol promotes the incorporation of regional productive enterprises in the supply chain of the Business Group and empowers companies from different industrial sectors, which come from or link vulnerable populations.
Since its deployment in May 2020 to date, more than 2,000 meetings have been held, in 77 “Somos Colombia” Rounds, from which 1,004 sustainable businesses have benefited, for an approximate value of $63 milliards COP and the generation of around 7,500 non-oil inclusive jobs. Additionally, it is worth noting that more than 2,100 entrepreneurs are part of the Directory of Responsible Purchasing.
To learn more about the strategy, activities, achievements, and purposeful purchasing portfolio of the Diverse Productive Enterprises, see the following link:
Diversity and inclusion in the Supply Chain
