Financial and
ESG report 2020

Business partners

Procurement policy

[GRI 102-9] The Bank cooperates with many business partners as the buyer of products and services from various market segments. The key business partners render services associated with the lease of and support for branches and office space, services and purchase of IT equipment and security and marketing services.  

[GRI 103-1, 103-2, 103-3] The principles of cooperation with Bank Millennium’s suppliers are described in the Instructions for selecting suppliers and making purchases. These instructions define, among other things, how the procurement process is organized, the role played by the various process participants and the supplier selection criteria. Suppliers are selected in tenders, which allows the Bank to use objective selection criteria. To ensure transparency of the procurement process, the substantive and commercial evaluations of bids are done by independent Bank units. The chief risk ensuing from inappropriate cooperation with suppliers involves a limitation on the ability to render banking services.  

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The Bank collaborates with brokers on the basis of agency agreements. Collaboration involves the Bank entrusting businesses to perform the activities prescribed by the agreement related to acting as an intermediary in the sales of mortgage products. Ordinarily, the agency agreements entered into by the Bank are outsourcing contracts. Some branches of the Bank are operated under franchise agreements entered into with commercial undertakings running them. 

The Bank’s Companies collaborate with business partners on the basis of agency cooperation agreements. They are entered into with business entities or individuals working in a given organizational unit (Representatives).  

Criteria for selecting suppliers

The criteria for selecting suppliers in tender procedures include: good ratio of quality to cost of the services or products and the terms of delivery and payment. The bidder’s substantive capabilities and financial reliability are also taken into account.  

Geographical location of the suppliers is not one of the selection criteria. In justified cases, the Bank also includes environmental and social factors among the aspects that affect its choice of suppliers. 

Purchases of goods used by the whole Group are governed by the Bank’s supplier selection policy. Specific supplier selection criteria are employed by Companies if separate regulations require that, e.g. the ones governing the operations of funds and mutual fund management companies at Millennium TFI. 

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Ethical and environmental standards

The requirement to apply ethical and/or environmental clauses in agreements, where applicable, is an important element of the regulation pertaining to the procurement process (for example OHS regulations in construction contracts or environmental services in waste disposal agreements). [GRI 205-2, FS5] Every supplier taking part in a tender procedure must undertake to observe the rules included in the Bank Millennium Group’s Code of Ethics, including the respect of human rights and compliance with anti-corruption policies, by signing a representation to that effect. Additionally, any supplier agreements currently executed contain a clause confirming the supplier’s compliance with the provisions of the Code of Ethics. In 2020, all suppliers of Bank Millennium participating in tenders were provided with the anti-corruption policies included in the Code of Ethics of the Bank Millennium Group.  

The performance of agreements of significance to the Bank is monitored. The quality and timeliness of services and goods and financial standing of the suppliers are evaluated. In justified cases, audits are conducted in suppliers' offices to assess their security and continuity of their business activity. In 2020, the quantity and quality of goods and services supplied was monitored for roughly 870 agreements by the Bank. In the case of 36 agreements, the suppliers’ financial standing and their contingency plans were monitored. The quantity and quality of goods and services supplied was monitored for roughly 2,014 agreements by the Bank’s Group.  

Products and services purchased

Group
2020
Bank
2020
Group
2019
 Bank
2019
Group
2018
Bank
2018
[GRI 102-9, 102-10] Number of suppliers   12,592   6,679  13,948  6,352  11,538  5,012 
[GRI 204-1] % of amounts paid to local suppliers*  95%  94%  92%  91%  89%  90% 
* with registered offices in Poland

Invoice payment term

Group
2020
Bank
2020
Group
2019
Bank
2019
Group
2018
Bank
2018
Up to 30 days  77%  67%  81%  60%  82%  67% 
31-60 days  18%  26%  16%  33%  15%  28% 
Over 60 days  5%  7%  3%  7%  3%  5% 

 

Millennium TFI Partners

[GRI 102-9] Various types of business partners are present in the activity pursued by Millennium TFI and the funds it manages.  These are: a transfer agent who keeps the registers of participants, a depositary of the funds’ assets, distributors of participation units, an entity which keeps the funds’ ledgers and calculates the value of the funds’ assets, suppliers of office, transport, legal and IT services, an entity which stores documents and an entity which manages correspondence workflow, an entity which keeps the Company’s ledgers (Bank), banks and brokerage houses as the funds’ business partners. The main categories of entities supplying services to the Company and the funds are distributors of participation units, the transfer agent, the depositary of the funds’ assets, the funds’ business partners (banks and brokerage houses), legal advisors and financial auditors as well as suppliers of IT services.  

Agreements with Millennium TFI suppliers are concluded and terms and conditions of services are specified based on the laws regulating the activities pursued by the funds and mutual fund management companies. In matters not covered by the abovementioned laws, the Company applies the Bank Millennium Group’s Code of Ethics, which regulates the principles of establishing and maintaining relationships with suppliers of goods and services.  

The main supplier selection criteria are specified in the laws regulating the activities pursued by funds and mutual fund management companies. Since mutual fund management companies and banks are governed by different regulations, the criteria applied by the Company can substantially differ from the criteria applied by Bank Millennium. To the extent to which the Company employs group solutions when buying goods and services, the supplier selection policy in force is compliant with the principles included in the Bank Millennium Group’s Code of Ethics. 

[GRI FS5] The Company has not obliged its suppliers to observe ethical and environmental standards. Such obligations are used when the Company concludes group agreements with suppliers in accordance with the principles included in the Bank Millennium Group’s Code of Ethics. 

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