Tullow Oil plc 2011/2012 Corporate Responsibility Report - The Group

“Tullow’s commitment to creating sharedprosperity for our host countries, as wellas our business, is underpinned byethical and responsible businesspractices focused on creating asustainable supply chain.”More informationPageCompliance 57Local supplier expenditure 833MEASURING OUR PERFORMANCEDavid MooneyHead of Supply ChainWe recognise that local suppliers need additional support toachieve supplier pre-qualification, in addition to assistance postcontract award to make sure they consistently meet thestandards required. Most importantly we plan for success in ourcontract strategies so that we can meet peak supply chainrequirements in a sustainable way and move to a fast trackonce oil is found. Our supplier development programme is setout in the local content section on pages 74 to 75 of this report.Fostering a wider opportunityLocal content plays an important role in risk assessment andmarket intelligence for our contract strategies. We are alsodeveloping stakeholder engagement skills within the localcontent team to work with all aspects of local and nationalgovernment in support of robust legislation and stronggovernment initiatives to build capacity. In 2012/2013, we areextending enterprise development and capacity building to awider range of services and goods. We are also looking atcreating greater linkages across our supply chain throughvocational skills training and agri-supply. Agriculture is asignificant part of host country development goals as it enhancesfood security and is a major source of revenue and employment.While there is a finite opportunity for suppliers within our supplychain, developing capacity to serve the emerging oil industrycan be a passport to opportunity and growth in new businessfor local suppliers. The multiplier effect of higher standards,entrepreneurial networks and business-to-businessrelationships can evolve into economic and social developmentbeyond the oil sector. Lasting improvements in quality,productivity and governance can serve as a magnet to attractother goods and services and foreign direct investment.Growing a country’s private sector is the only long-term wayto build a dynamic economy and benefit the lives of localpeople. In partnership with a wide range of stakeholders,Tullow can, through its supply chain, assist in building the rightenvironment to facilitate local and international investment,thereby creating jobs and building a more diversified economy.SUPPLIER ETHICS AND COMPLIANCETullow’s Compliance team, along with Supply Chain,hosted the first Industry Partner ComplianceWorkshop in Bangladesh this year. This wasfollowed by a similar event in Kenya. The forumsfeatured an overview of anti-bribery legislation,including the UK Bribery Act 2010, and outlinedTullow’s compliance expectations of IndustryPartners. The forums also covered the importance ofdue diligence, the effects of non-compliant behaviourand details of Tullow’s confidential reporting line.In addition, the Industry Partners were given anoverview of Tullow’s Code of Business Conduct,introducing key supplier related elements suchas our gifts and hospitality policy and facilitationpayments guidance. The issue of facilitationpayments was an area of particular interest whenTullow and the Industry Partners discussed thechallenges of working in developing countries.We can already demonstrate that transferable skills and servicescan lead to new business opportunities and partnerships withinternational companies. Visit www.tullowoil.com/casestudiesMichael Mawuli Ahorlu, Supplier Development Specialist, Tullow Ghana73www.tullowoil.com