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To ensure compliance with our standards and thus anticipate and mitigate risks in the supply chain, we have developed a risk

control system based mainly on assess- ment and monitoring of our suppliers.

The process begins with supplier regis- tration and approval and is implemented entirely via our C2S purchasing platform to assure transparency and ethical con- duct throughout. At this first stage of the process, we check that our suppliers are compliant with a range of selection cri- teria to ensure we can create a supply chain that fulfils the highest standards of quality, respect for the environment, corporate responsibility, human rights, occupational risk prevention and finan- cial stability, among other factors. This year we implemented more than 6,300 purchasing processes on our platform, embracing both new and previously ap- proved suppliers.

Following this we regularly assess our suppliers performance, independently of process stage. Such assessment looks at quality, execution, safety (especially for contractors working at our facilities), environmental and energy efficiency per- formance, innovation, ethical conduct, regulatory compliance, and fulfilment of requested technical specifications.

In 2017, we conducted more than 3,000 assessments on over 1,200 of our sup- pliers, supplemented by an exhaustive international programme of audits to maximise control over our supply chain. Our supplier auditing plan was carried out with three aims in mind:

Identify supplier non-compliance with regards to Cespa s standards in Envi- ronment, Health and Safety, Quality, Corporate Responsibility and more in order to establish the right measures.

To minimise risks in the supply chain by ensuring that procurement is awarded to suppliers who are compli- ant with Cepsa standards.

To improve the performance of sup- pliers of goods and services to Cepsa.

Audits are conducted on site for a period of two days. Following a protocol, we re- view matters relating to quality, health and safety, the environment, financial management, human resources and cor- porate responsibility.

ASSESSmENT AND AUDITINg OF SUPPLIERS

REgISTRATION AND APPROvAL

SUPPLIERS DEVELOPMENT AND STRATEGIC ALLIANCES

SEgmENTATION PERFORmANCE ASESSmENT

CONTROL OF SUPPLy CHAIN ASSOCIATED RISkS

mAXImISINg THE vALUE OF SUPPLIERS RELATIONSHIP: ImPROvEmENT ACTIONS

ENSURE TAHT SUPPLIERS ARE QUIALIFIED IN ACORDANCE WITH CEPSA STANDARDS

PROvIDE bUyERS WITH ELEmENTS THAT HELP THEm IN DECISSION mAkINg

2017 ANNUAL AND CORPORATE RESPONSIbILITy REPORT