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CHAPTER 4 Responsible management

OUR SUPPLY CHAIN Our supply chain is made up of near- ly 4,300 suppliers worldwide, of which we focus on 2,364 in the procurement area, the rest being considered as tail spend. Among the ones belonging to the purchasing area, 70% of them provide services and 30% supply goods (materi- als, spare parts and equipment). For all of them, a series of legal, fiscal, ethical, health and safety and environmental re- quirements are established, which are

standardised and included in the Stan- dard Business Terms and in the Code of Ethics for Suppliers, and which must be accepted both in the registration process and in all the awarding stages.

In order to manage our supply chain in an appropriate manner that is adapted to particular characteristics, we classify our suppliers into various segments:

Cepsa conducts the risk assessment for all current suppliers in the procurement unit, in order to gain an insight into our supply chain, establish the appropriate requirements for each type, implement mitigation actions, monitor their perfor- mance and request audits to detect areas for improvement where necessary.

In order to achieve greater efficiency and agility in the processes, in 2019 we reviewed the submittal to the Awards Committees and Procurement Strategy of those proposals of greater value, so that the submittal of processes of lesser amount can be expedited and reduced without lowering the necessary levels of control and compliance in all cases.

SEGMENTS I, II, & III

They include 17% of all Cepsa's suppliers.

They represent 93% of the supplier spend.

We promote management models adapted to each supplier type.

SEGMENTS IV & V

They represent 7% of the supplier spend.

In segment IV we monitor their criticality and risk level.

Segment V includes the suppliers in relation to which the cumulative annual spend is less than EUR 10,000 and who are considered to be outside the procurement scope.