Supply chain

The basic raw materials used by the Capital Group include primary aluminium, aluminium scrap as well as semi-finished products based on aluminium (sheet aluminium and aluminium foil as well as billets made from aluminium and its alloys). In the production of flexible packaging, the Group also uses various types of plastic films and granulates (polyethylene, polypropylene), universal and grease-proof printing paper, paints, adhesives and binders. The list of basic raw materials is supplemented with accessories and semi-products for the production of aluminium systems: fittings, weather strips, glazing, etc. Due to the necessity of maintaining high quality of production, the purchasing policy of the Capital Group is based on cooperation with selected suppliers who guarantee proper standards. At the same time, diversification of suppliers has been assumed in order to secure supplies and maintain their competitiveness. Being aware of its impact on the environment, the Company has been trying, in the first place, to use the services of local or national suppliers. Unfortunately, due to the nature of the industry, it is possible only to a limited extent (aluminium scrap, paints, lacquers, thinners, granulate for plastic film production, and some accessories for systems production). Owing to a major increase in the prices of materials, which are mostly imported, the share of domestically sourced materials dropped from 30% in 2021 to 29% in 2022. Suppliers from the rest of Europe accounted for about 60% (-5 p.p. y/y), and suppliers from other continents for about 11% (+6 p.p. y/y). In addition, due to Russia’s aggression against Ukraine and the support of this aggression by the Belarusian authorities, the Capital Group suspended cooperation with contractors from these countries.

Since 2021, the Capital Group has had a process in place to oversee the environmental impact, occupational health and safety, as well as respect for human rights in the supply chain. For that purpose, a document entitled the ‘Code of Conduct for the Suppliers of the Grupa KĘTY S.A. Capital Group’ (the ‘Code’) was drafted. The Code specifies the major requirements for the suppliers of the Capital Group of Grupa KĘTY S.A. with regard to running ethical and fair activities, ensuring safe and hygienic working conditions, respecting human rights, assuming liability for the quality of products and for the natural environment.