Quest Diagnostics Strengthens Supply Chain Management With Enhanced ESG Risk Assessment, Supplier Diversity, and Commitment to Ethical Standards
Originally published in Quest Diagnostics' 2023 Corporate Responsibility Report
Creating a healthier world requires collaboration, both across our internal team and with our global suppliers. Our suppliers allow us to provide the high-quality care and testing that our patients rely on. That’s why we hold them to the same standards of ethics and integrity that we adhere to. We also look for opportunities to improve sustainability in our supply chain and support more diverse businesses.
SUPPLIER CODE OF CONDUCT
We expect our suppliers to uphold our commitments to ethics, safety, quality, and respect for human rights. Suppliers are required to read and adhere to our Supplier Code of Conduct as a condition of doing business with Quest. They must train their employees in our Code of Conduct, self-monitor, and demonstrate their compliance. If a supplier fails to follow the standards established within our Code of Conduct, their relationship with Quest may be terminated.
Our commitment to human rights
We uphold our commitment to human rights by operating in a way that treats all people with respect and dignity. We embrace diversity across our workforce and strive for a work environment that promotes varied opinions and equal opportunities. We also respect our employees’ rights to freedom of association, consistent with applicable federal, state, and local laws. We hold our suppliers to the same high standards.
Quest works with our largest suppliers to minimize waste through initiatives like streamlining shipments and reducing packaging.
MANAGING SUPPLY CHAIN RISKS
Our focus on Corporate Responsibility includes assessing and examining any potential ESG and/or financial risk involved in doing business with our suppliers. Our framework for risk assessment and any necessary corrective action includes:
- Understanding suppliers’ ESG journeys: We recognize that each of our suppliers is on their own ESG journey. To gain an understanding of what they are doing, we ask them to complete an ESG self-assessment. In 2023, 53% of our suppliers (based on annual spend) successfully completed their self-assessment, which included questions related to governance, as well as environmental and social/labor policies. This marks an uptick from 40% of Quest suppliers (based on annual spend) completing this assessment in 2022.
- Evaluating new suppliers for financial risk: When going through the procurement process for new suppliers, we complete a thorough assessment of any financial risks. While this has long been a part of our procurement protocol, in 2023 we streamlined financial and ESG risk assessment and began analyzing suppliers using a scorecard that accounts for both—helping us gain insight into interconnected material risks.
- Corrective action and supplier improvement plans: Once our risk assessment process is complete, we work with suppliers to identify any necessary corrective actions. We’ve had a corrective action program in place for over 13 years, and are working to expand this program to cover ESG-related corrective actions in 2024.
SUPPLIER DIVERSITY
Quest is committed to doing business with small and diverse US suppliers, as classified by the US Small Business Administration. Over the last 5 years, we’ve spent over $1.7 billion on goods and services from small and diverse US businesses—including $343 million in 2023. We are on track to reach our goal of $500 million by 2026. In addition, we are a corporate member of the National Minority Supplier Development Council and its affiliated Health Care Industry Group, which helps us broaden the base of suppliers we work with and stay up to date on best practices.
Review our full approach in our Supply Chain Transparency Document and Supplier Diversity Policy.
