2011
AMBATOVY SUSTAINABILITY REPORT
35
The Ambatovy Supplier Audit Program
Ambatovy has initiated a new program that audits suppliers
to ensure they fulfill the necessary legal, organizational and
performance requirements for our Procurement Policy. A third
party conducts the audit and recommendations are made
to the supplier for ways to improve. Once a supplier passes
all the requirements, they are given a Certificate of Approval
stating that they are compliant with all of Ambatovy’s quality
requirements. Although the audit does not look specifically
at human rights-related aspects of the supplier’s business,
it is an important tool to ensure that our suppliers provide a
legitimate working environment for their employees. Since this
is a new program in operation for only part of 2011, we were
able to complete just a small portion of audits (less than 1%
of national suppliers). Our target is to complete 250 audits
by the end of 2012, which will be approximately 85%
6
of our
in-country suppliers.
Business Training Centre
By the end of 2011, ALBI had started working in collaboration
with the World Bank/IFC to put in place a business centre,
which will provide a two-part training to local businesses:
3
Basic training including elements on answering a
tender, cost-price analysis, basic accounting, building
a business plan and accessing bank business loans.
3
Additional training provided on specific needs identified
through audits.
Tafita Supplier Database
The Tafita Supplier Database is an internal data management
system that allows us to improve local supplier definition,
linkages and availability for purchasing and contracts. By
the end of 2011, more than 2,600 businesses had been
registered, of which 86% were Malagasy enterprises, creating
a vast pool of potential suppliers and contractors.
During the year, we also worked with Malagasy enterprises
to build up specialized industrial capacity in the area to allow
us to procure locally the major maintenance services we will
require. While there was already some industry around the
plant site before we began construction, there was nothing on
the necessary scale or specific technical requirements. We
have worked with small, medium and large local businesses
to make sure they are equipped to participate in the supply
and service opportunities our operations will create. For
example:
3
We worked with local companies to start a number
of repair shops, such as the one to provide rubber
lining services and repairs to the plant site. This repair
service did not previously exist in the area, but is
necessary for continual maintenance of major aspects
of the plant. This project alone has added over 30
skilled technical service jobs.
3
We provided contracts and training to numerous
smaller companies for maintenance work on our
equipment and infrastructure, such as heating,
ventilation and air conditioning (HVAC), building and
electrical maintenance.
3
We initiated and developed links with larger national
companies to put together the skilled work crews
required during various maintenance cycles of the
plant site. Such maintenance can require large
crews numbering in the hundreds with a variety of
technical skills, some of which will be new to the local
economy. The initial discussions and planning, along
with the award of some of the required contracts to
local contractors, have begun and will continue to be
a major effort in 2012. Training initiatives are being
developed in conjunction with local suppliers to ensure
we reach the appropriate quality and safety standards
to operate on the site.
3
2011 also saw the first transportation of commodities
from the port to the plant site using the Madarail
services. In order to facilitate this process, Madarail,
which operates the line, has hired and trained over 300
local employees, adding to the skilled trade capacity of
the Toamasina area.
We have seen remarkable success in facilitating local
procurement. In 2011 alone, we spent $212 million on local
purchases.
6
Based on 2011 supplier figures.
Economic Performance
