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Ericsson Global
Risk based model 

A risk assessment model for prioritizing and selecting markets and businesses for Code of Conduct audits  was introduced in 2006 and expanded in 2007.


The implementation of the risk model has resulted in focused audit programs. The supplier risk assessment uses market risk and commodity risk factors to identify critical suppliers.


The market risk factors include  revenue, market maturity, and social and political aspects. The commodity risk factors are set as a function of how critical each line of business' processes and activities are from a Code of Conduct perspective.

Through close engagement with suppliers, Ericsson significantly reduced the number of lowest markings on the Code of Conduct scorecard among selected die-casting suppliers in China and India and network roll-out suppliers in India and Brazil.

Current focus resulting from the risk assessment model, see the below results. 

 

From 2007 through to the present, Ericsson has extended the risk-based approach globally, focusing on the new areas such as enclosures, printed circuit board manufacturing, power systems for radio base station solutions, tower manufacturing and logistics.