Procurement

Supply chains have largely normalised

The Purchasing department at the Group is responsible worldwide for procuring raw materials, semi-finished and finished products, commercial products, and services. Besides minimising costs, the primary purpose of comprehensive supplier management is to safeguard the supply of all the necessary materials and services.

In the reporting year, freight costs were exposed to certain fluctuations. This was due to the situation in the Middle East, which led to a shift and extension of transport routes in the Red Sea. However, the availability of raw materials and components was good and delivery times returned back to normal during the course of the year.

The prices of direct materials largely moved sideways in the reporting year and were generally lower than in 2023. The only fluctuations were seen in May, which was the result of economic data from China and Japan that remained below expectations. Despite this stabilisation, prices were still at a high level from a historic perspective. Compared to the previous year, the impact of the price changes on the income statement was -5.2% in local currencies or CHF -47 million.

In the first six months of 2024, energy prices were below the previous year, while in the second half of the year, they settled at slightly above the previous year’s level. Compared to the previous year, the decrease in energy prices in local currencies totalled -2.9% or CHF -3.3 million.

Compliance with Code of Conduct for Suppliers checked

All of Geberit’s business partners and suppliers are obliged to comply with comprehensive standards. This applies to quality, socially responsible and healthy working conditions, human rights as well as environmental protection and the commitment to fair business practices. The basis for the cooperation is the Code of Conduct for Suppliers. Last revised in 2016, this Code is aligned with the principles of the United Nations Global Compact and is available in 15 languages. As of the end of the reporting year, more than 95% of suppliers as measured in terms of direct purchasing volumes had signed the Code.

Corporate Purchasing and Sustainability jointly ensure that the standards found in the Code of Conduct are upheld by conducting regular EHS (Environment, Health and Safety) audits. The number of audits made and their content are selected with the help of a risk matrix. The goal of these audits is to check compliance with the Code of Conduct and local legal requirements regarding environmental aspects, occupational health and safety and social responsibility – including human rights – on site. The audits are carried out by an independent service provider. Appropriate measures are then initiated where required. During the reporting year, seven external EHS audits (previous year five EHS audits) were carried out at suppliers in the area of procurement.

Supplier Integrity Line

Introduced in 2017, the Supplier Integrity Line from Geberit allows suppliers to anonymously report any violations of the guidelines set out in the Code of Conduct for Suppliers by Geberit employees or by competitors. The hotline is free of charge for users and is operated by an independent service company in a total of 30 languages. Violations can also be reported online via the Geberit Group website.

Due diligence obligations according to the Swiss Code of Obligations (CO Art. 964a ff.)

Part of risk management in procurement also involves checking adherence to the due diligence obligations described in the Swiss Code of Obligations, which are aimed at preventing child labour and the use of conflict materials. As Geberit neither directly imports nor processes conflict minerals (tin, tantalum, tungsten, gold) in the EU or Switzerland, it is not deemed to be an “importer” within the meaning of EU Regulation 2017/821 or Art. 964a ff. of the Swiss Code of Obligations. Furthermore, there were no suspicions of cases of child labour in the supply chain. For further information, see Performance 2024, Procurement.