20250113VEO to Staff 74 Attachment 2.pdf

(i) VEOLIA
VNA Policy
Issued by : VNA Procurement PP No : PC_100
Approved by : VNA Policy Review Committee Revision No : 2.0
Effective Date : 01 May 2022
SUBJECT: PURCHASING POLICY
1.0 SCOPE
This policy applies to all employees of Veolia North America (VNA), including its North American affiliated
entities and relates to the purchasing process. With regard to companies over which the group has either
joint control or a significant influence, the policy shall apply whenever management is entrusted in
agreement with the partners,to Veolia North America or to one of its subsidiaries.
If an employee's employment is covered by a collective bargaining agreement, the collective bargaining
agreement—and not this policy—will govern.
The Policy addresses:
❑ Controls governing the Purchasing Cycle
Supplier selection
Approved purchasing methods
❑ Predetermined/preauthorized exceptions to the Purchasing Cycle
2.0 PURPOSE
This policy provides the framework for the Purchasing Cycle and establishes the minimum standards for
procurement of all goods, services and works for VNA, including essential controls related to the financial
and accounting aspects of purchasing. Proper application of this policy is required in order to be in
compliance with Veolia guidelines and Internal Control requirements.
Complying with this Policy will lead to:
❑ Proper approval of expenditure commitments
Optimization of Veolia's purchasing power
❑ Compliance with Internal Control requirements
❑ Increased reliability of financial reporting
❑ Efficiency of purchasing administration
❑ Improved vendor supply chains to help deliver service to customers meeting targeted standards
for quality, safety,timeliness, cost, and regulatory compliance
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❑ Timely procurement of parts and services to optimize the availability of Veolia owned and/or
operated equipment
Efficient procurement of goods and services needed for approved OPEX and CAPEX so that the
objectives of those projects are achieved
Note: For detailed information on purchasing of fleet vehicles, please refer to the VNA Vehicle
Management Policy.
3.0 RESPONSIBILITIES
Employees involved in purchasing activities are responsible for following this policy and associated
procedures.
Managers are responsible for ensuring adherence to this policy and monitoring the correct application of
procedures related to this policy.
The VNA Procurement Team is responsible for overseeing the procurement of goods, services and works
on behalf of the Company,which includes the selection of supplier, negotiation of price, and assurance of
quality and delivery. The team is also responsible for the development of standards, specifications,
materials and systems, in conjunction with purchasing system users.
4.0 REFERENCES AND FORMS
• Procurement Procedures
• Corporate Agreements/Principal Contracts
• Contract Templates
• Purchase Order Terms& Conditions- Veolia North America
• Vendor Request Form U.S.
• Vendor Request Form Canada/Foreign
• PC 101 VNA Travel Policy
• PC 103 VNA Vehicle Management Policy
• IC 102 Delegations of Authorities
• Procurement Intranet Page
• Find a Preferred Supplier or Commodity Manager
• LG 101 Risk Review Process
5.0 DEFINITIONS
Blanket Purchase Order- Purchase Order with a set limit and expiration date established with suppliers
to satisfy the need for commonly used and repeatedly purchased materials and/or services.
CMMS-Asset Management System or Computerized Maintenance Management System (CMMS), which
may interface with the purchasing system to allow purchase requisitions to be made via the CMMS.
Examples of CMMS used in VNA include OWAM, Maximo, Azzier, SAP PM,VAMS, etc.
Commodity Manager or Category Manager- Member of the Indirect or Direct Procurement teams in
charge of a specific commodity or Purchasing Category.The Commodity Manager's primary function is to
manage the sourcing process for assigned spend categories, including the selection of suppliers based on
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SUBJECT: PURCHASING POLICY
established criteria and the negotiation on pricing and services level. Commodity Managers will develop
structured relationships with key suppliers to ensure that the supply chain is as stable as possible for
operation efficiency.
DAG-The Group/Global Procurement Department(Departement des Achats-Group)
Delegation of Authority("DOA")—Delegation(s) leading to a transaction or commitment to a third party.
Under the legal theory of implied mandate, a company may be committed by a signatory who, in the
opinion of a third party acting in good faith,could be deemed as holding signing authorities. Delegation(s)
exercised when authorizing or approving a transaction or commitment (decision-making function) prior
to the implementation of external signing authorities. Refer to IC 102 Delegations of Authorities for
additional information.
Direct spend- Purchases that relate to operation, maintenance and production activities.
Emergency-For the purposes of purchasing,an emergency is defined as an unexpected need to purchase
goods/services/works in less than 24 hours of the initial need identification.
Inactive vendors - Any vendor that has not had a PO issued or invoice paid to them in more than 26
months.
Indirect Spend - Purchases that relate to general and administrative activities. These purchases may
support Operations but are not directly used in operations, maintenance or production activities.
Non-Preferred Supplier-Supplier with which no Corporate or Global/National/Regional Agreement has
been executed.
Preferred Supplier - Supplier with which VNA or DAG has executed a Corporate Agreement, Global or
National, including negotiated pricing and terms and conditions.
Punch-out Catalog-Vendor's web-based catalog, accessed via the purchasing system (i.e.,Ariba).
Purchase Order("PO")-An approved and issued Purchase Request.
Purchase Approver("Approver")- User with the relevant authority to approve Purchase Request.
Purchase Receiver("Receiver")- User with the relevant authority to receive against a PO.
Purchase Request ("PR") - Request entered in the Purchasing System for approval to buy goods or
services.
Purchase Requester("Requester")- User with the relevant authority to generate a Purchase Request.
Purchasing Agent— Member of the Procurement team, whose primary function is to confirm the use of
preferred vendors and global/national agreements, and to ensure adherence to the Purchasing Policy by
all purchasing actors.
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Purchasing Category-Assigned classification for a specific purchase by nature of such purchase. Refer to
the DAG Purchasing Classification information located on One To One.
Purchasing Cycle—The process of purchasing from initial business need identification to requisition to
payment.
Purchasing System— Encompasses both the CMMS and ERP software applications (e.g. Concur/Ariba /
SAP S/4HANA) software applications.
Retrospective PO-A purchase order that is issued after the actual purchase has been made and invoice
has been received.
SAP S14 HANA — VNA's Enterprise Resource Planning (ERP) purchasing, vendor database and financial
system of record.
Segregation of Duties (SOD) - Rules and systemic controls that prohibit one person from completing
multiple tasks within a process; serves to reduce risk of fraud and misuse of company funds.
Statement of Work(SOW)-A defined project or deliverables to be governed by and performed under a
framework agreement/contract.
Subcontractor- An individual or business that signs a contract with VNA to perform part or all of the
obligations of VNA under another contract.
Supplier—Contractor, subcontractor, manufacturer, vendor or dealer that provides, or has the potential
to provide, products/services/works.
Vendor—See Supplier
Vendor Database-Vendor records maintained in SAP S/4HANA Data Management module and interfaced
with the Purchasing System.
VNA—Veolia North America and its subsidiaries.
Veolia(VE)-the ultimate parent company of VNA, also referred to as Veolia Group.
6.0 PROCEDURE
The Purchasing Cycle provides a framework for all procurement transactions to help ensure they are
compliant, competitive and obtain the best overall value for the company in terms of supply reliability,
risk, quality and cost.While the exact procurement process steps may vary depending upon the value and
nature of the goods, services or works being obtained, the overall objectives of the process remain the
same. Strong collaboration between the business operations and the corporate procurement team is
required in order to:
Support the business units' activities
✓ Guarantee high quality and availability of products and services
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✓ Control supplier risk: supply disruption,safety, quality, lead time problems,financial risks
❑ Positively contribute to Veolia's performance
✓ Set up efficient contracts resulting from the implementation of strategies adapted to each
purchasing category, notably taking into account the Total Cost of Ownership (TCO) of
goods and services or the introduction of benchmarks used as a basis for renegotiations
✓ Implement best practices in terms of procurement and supplier management by applying
defined processes and using appropriate tools to help contain expenditures
✓ Provide consistent application of contracts and terms
✓ Reduce costs
❑ Promote the efficiency of the supply process
✓ Optimize administrative processes through the dematerialization of orders to save time
and reduce environmental impact.
6.1 Principles of the Purchasing Cycle
The Purchasing Cycle is the multi-step process of purchasing that starts with identifying the need
for a purchase and ends with payment for the purchase.The Purchasing Cycle has 7 key steps:
Identify Submit a Obtain Purchase Item or Invoice Dt
the need purchase financial order serviced received sfor a good requisition approval created received s
or service
When the need for a product or service arises, the purchasing location should ensure that the
item is not currently in stock anywhere within the local facility and/or that the facility staff is
unable to self-perform the service before seeking to purchase the goods/services externally.Once
the need is confirmed, it must be quantified and an appropriate supplier selected. Please refer to
section 6.3 for information regarding supplier selection.
After the business need for a good or service from a specific supplier has been identified, a
purchase requisition or purchase request will need to be created.The purchase request will then
need to be approved by an employee with the appropriate level of financial Delegation of
Authority or DOA.
It is essential to have DOA approval of the purchase BEFORE an order is placed or a commitment
of funds is made. Retrospective PO, which are those purchase orders issued after the actual
purchase has been made and invoice received, circumvent the normal controls in the purchasing
cycle and are strongly discouraged. For additional information about DOA, please refer to Internal
Control Policy IC 102.
6.1.1 Formalizing the Purchase Request
For purchases above $2,500 USD or $3,000 CAD, Purchase Requests, and subsequently
Purchase Orders or POs, should be created either directly within the Purchasing System
(e.g., SAP, Ariba) or within the Computerized Maintenance Management System (CMMS
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such as VAMS, SAP S/4HANA, OWAM or Maximo) which interfaces with the Purchasing
System.
Blanket POs are used to provide an efficient means for repetitive purchases with the same
vendor and when it is impractical to create a separate PO for each discrete order (ex.
chemicals, transportation, etc.). The amount of the Blanket PO should be based on a
realistic estimate of vendor spend during the period that the PO will be used. Blanket POs
are recommended to be replaced on a monthly or quarterly basis and must not be used
for more than 12 months.They should also only be used within a single calendar year. If
a blanket PO is needed for the next calendar year,the old PO should be closed and a new
one created for the new year.
POs can also be used for purchases below the $2,500 USD ($3,000 CAD) threshold,
however, in some cases corporate credit cards may be used as an alternative purchasing
method. See table below for details.
Non-PO purchases are an exception to the normal purchasing process and should be used
sparingly for certain types of purchases. Refer to section 6.2.2 for additional details.
Purchase Choice Matrix:
Type of Purchase PO P-Card/Travel Card Non-PO
YES YES YES
Preferred payment Allowed for non-
method.
Required for recurring small
General Purchases less than $2,500 USD or goods purchases, Limited use-
Subcontracting,
$3,000 CAD Consulting (non- emergencies and as see section
political) and indicated in the T&E 6.2.2
Intellectual and/or P-card
Services purchases procedures
YES YES YES
Limited use- For
General Purchases greater than $2,500 USD Preferred payment emergencies and Limited use-
or$3,000 CAD method ONLY if allowed by see section
T&E and/or P-card 6.2.2
procedure
Legal Invoices (processed through Serengeti),
Property Rent,Tax Payments, Political and NO NO YES
Charitable Contributions/Sponsorships, and
Political Consultants
Note that proper segregation of duties (SOD) must exist between the Initiate, Authorize
and Record functions of the PO. This means that the same individual must not submit a
purchase request, approve the request and/or receive the goods/services. Where
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segregation of duties is limited, compensating controls must be documented and
approved by VNA Internal Control.
Approval of a Purchase Request represents a financial commitment on behalf of the
Company. Approval thresholds are determined by the purchasing system workflow
approval matrix and DOA.
Purchase Requests should not be subdivided or split into multiple requests in an effort to
circumvent authorized DOA approval limits. Systematic audit controls are in place to
identify and remediate this type of activity. Refer to IC 102 Delegations of Authority for
additional information.
6.1.2 Purchase Request Approval and Purchase Order Creation
A Purchase Request becomes a PO after the Approver actually approves it in the system.
Such approval must occur within assigned DOA, hence the approval workflow only stops
when proper DOA has been reached along the hierarchical workflow. A list of authorized
employees/approval limits is maintained as part of the Purchasing System approval
workflow.
The Purchasing System is designed so that a Requester cannot self-approve his/her/their
own Purchase Requests. All Purchase Requests shall be routed based on the approval
workflow as defined within the Purchasing System.
6.1.3 Issuing the Purchase Order(PO)
Upon approval of the Purchase Request, the Purchasing System automates the
assignment of a sequential Purchase Order number and all required vendor information.
Purchase Approver or designee is responsible for monitoring submitted Purchase
Requests to ensure that the proper commodity and analytical elements (company code,
cost center, WBSe, etc.) are selected, as it drives the accounting allocation.
It is the responsibility of the Requester to ensure the PO has been emailed to the vendor
and the order is placed. The PO references the standard VNA PO terms and conditions,
which are available on VNA's external website on the Vendors and Suppliers page. It is
critical that all PO's are sent to vendors, because once accepted, the vendor agrees to
VNA standard PO terms and conditions, unless a contract with alternate terms and
conditions is in place. Shipping goods or services shows acceptance of VNA terms and
conditions. If the vendor does not agree to Veolia's standard PO terms and conditions,
they need to notify the Veolia Requestor and not ship the product or perform service until
terms are negotiated and a contract is put in place by the Procurement team.
6.1.4 Receiving the Products or Services
Receiving the goods and services in the purchasing system is an essential part of the
purchasing cycle process. It is the first step to ensuring that the vendor gets paid in a
timely manner. Orders that have been delivered but not received will not be paid. Best
practice is to receive goods/services in the purchasing system within 1 business day of
when they are delivered/rendered.
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It is important to note that a backlog of delivered but unreceived orders creates a
multitude of accounting issues and has a negative impact on our reputation with the
supplier. It also puts us at higher risk of being placed on credit hold by the vendor which
will prevent purchasers across VNA from placing new orders with the vendor until the
receiving and payment delays have been resolved. As a result, access to the purchasing
system may be revoked for purchasers who have chronic issues with late receipts.
6.1.4.1 Taking Delivery of Products or Services
The steps are:
• Checking against the Purchase Order(references, quality, and quantity).
• Signing the receiving document and physical inspection of products.
• If compliant, enter Receipt into the Purchasing System.
• Maintain receiving documents for auditing purposes if not retained in an
electronic format.
6.1.4.2 Taking Delivery of Products
a) Purchase Order Review
The delivery of products shall be reviewed against the PO for compliance. If a
discrepancy (incorrect products, quantity, quality, etc.) exists between the PO
and the products being delivered, the Receiver or an appropriate Veolia
representative shall either refuse delivery, contact the vendor for resolution or
submit a Change Request. All change orders and PO changes will follow the
system generated approval process. If a Receipt is made without correcting the
PO, it will generate a Match Exception (see Section 6.1.6) requiring resolution
prior to completing the vendor payment process.
b) Physical Inspection
A physical inspection of the products shall be performed prior to being received
in the Purchasing System. Receiving documents must be compared to physical
products received (see subsection c below).
• If the receiving document matches the physical products, the Receiver shall
sign and print their name on the receiving document attesting to its accuracy.
• If a discrepancy exists between the receiving document and the physical
products, the Receiver must refuse delivery and/or contact the vendor for
resolution. Reference Section 6.1.7. "Rejections and Returns."
c) Recording the Receipt in the Purchasing System
Once the physical inspection and PO review have been satisfactorily completed,
the Receiver or authorized Veolia representative completes the Receipt within
the Purchasing System using receiving documents as support. The individual
physically receiving products may assign a designee who processes Receipts in
the system; however the person physically receiving the products or services may
not be the Approver for that transaction. It is the responsibility of each Business
Unit to properly store and maintain all supporting documentation (bill of lading,
packing slip, etc.) if not retained electronically within the purchasing system.
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6.1.4.3 Taking Delivery of Services
a) Purchase Order Review
The delivery of services shall be reviewed against the PO for compliance(incorrect
and sufficient service or work performed, performance, etc.).
b) Physical Inspection
A physical inspection of the service shall be performed prior to being received in
the Purchasing System. Receiving documents must be compared to service
performed.
• If the receiving document matches the services performed or received, the
Receiver shall sign the receiving document attesting to its accuracy
(examples: approved work orders,timesheets, any other source documents,
etc.).
• If a discrepancy exists between the receiving document and the service
performed, the Receiver or Veolia representative must contact the vendor
for resolution. Reference Sections 6.1.7"Rejections and Returns,"for further
information.
c) Recording the Receipt in the Purchasing System
Follow the same procedure as referenced under c) in Section 6.1.4.2 above.
6.1.5 Rejections and Returns
Rejections and returns are external to the Purchasing System. All rejections and returns
should be completed prior to the delivery being received into the Purchasing System to
eliminate the need for credit notes. Rejections may include products delivered in poor
condition, in wrong quantity or incorrect items being delivered. Notice of rejection must
be given to the vendor as soon as possible but in any case within maximum one week of
receipt. Products must be returned to the vendor via the most appropriate shipping
method. Some vendors may require return goods authorization, please verify if this is
needed when giving notice of rejections.
Site/Department (as organized) is required to monitor all rejections and returns for
proper supplier adjustments. Once corrected products are received, please follow
6.1.4.1.
Documents should be retained by the appropriate function area in conjunction with the
applicable record retention policies.
6.1.6 Match Exceptions
Match Exceptions related to purchasing are defined as a discrepancy in the three-way
match between the Purchase Order, Receipt and Invoice. Match Exceptions shall be
reviewed by the Requester or the designated match exception coordinator upon
receipt of system generated match exception notification and action shall be taken
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within 10 days from notification. No payment will be made until all exceptions are
cleared.
Resolving match exceptions may require action by the vendor,which Veolia can't fully
control, so the sooner the vendor is contacted the less risk of not resolving the match
exception prior to the invoice due date. The vendor should be clearly informed that
payment will be delayed until the discrepancy is fully resolved.
VNA has established and maintains tolerances which account for normal variability in
the Purchasing Cycle. Tolerance limits and criteria will be set and authorized by
Finance, Internal Control and Procurement and controlled through the Purchasing
System.
6.1.6.1 Types of Match Exceptions and Reconciliation
a) Missing Receipt
Item or service was invoiced but not received into the Purchasing System.
Requestors are responsible for reconciling these Match Exceptions.
b) Price Discrepancy
PO and vendor invoice pricing will produce a Match Exception if the discrepancy
is beyond the system set tolerance limits. For Punch Out or Item Catalog PO,the
Requester should contact the VNA Procurement ([e-mail]) to
assist with reconciling the Match Exception.
c) Quantity Discrepancy
Quantity on Receipt, PO or invoice does not match. Requesters are responsible
for reconciling these types of Match Exceptions.
d) Non-PO Invoices
See Section 6.2.2 below, Non-PO Transactions, for reconciling invoices received
without an associated Purchase Order in the purchasing system.
6.1.6.2 Change to Purchase Request or PO
a) Editing or Canceling a Purchase Request
Requesters can withdraw,edit,or delete a Purchase Request prior to the PR being
approved into a PO. Comments should be added to the PR in the comments box
regarding the action being taken.
b) Purchase Order Changes
Once a PR is approved into a PO, no changes can be made; the Requester needs
to process a Change Request. Depending on the specific scenario of the PO,
various Change Requests can be processed, but in some cases the PO may need
to be canceled and a new PR submitted.
All changes will be routed for approval based on the workflow as defined within
the Purchasing System.
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Note: Change Requests cannot be done with Punch Out suppliers, coordination
with the supplier will be needed.
6.1.7 Purchase Recording
Purchases are processed and recorded using the Purchasing System or an approved
alternate method.
The recording function is the responsibility of the Accounts Payable team. Periodic
reviews of access by Internal Control will ensure those with access to enter or process
invoices or payments cannot initiate or authorize purchases in conformance with the
Group Memorandum relating to Delegations of Signing Authorities and Segregation
of Duties. Refer to IC 102 Delegations of Authority for additional information. .
6.2 Use of Corporate Cards and Non-PO Transactions
While POs are the standard method of purchasing, as indicated in the Purchasing Choice Matrix,
corporate credit cards such as the Travel and Expense (T&E) card or Purchasing card (P-card) and
non-PO transactions may be used in some instances instead of POs.
6.2.1 Purchasing Card (P-Card)and Travel & Expense (T&E) Card
Use of the P-Card is acceptable for non-recurring incidental purchases lower than
$2,500.00 or, in the event of an emergency,when the vendor is not able to meet
a required delivery timeline by using the normal Purchasing Cycle. Use of the P-
Card is also acceptable for making purchases in the event of a major outage of
the Purchasing System.
If the P-Card is used in an emergency for a purchase greater than $2,500.00,
please add a memo/note explaining the business justification for the purchase to
the expense report containing transaction(s) and why the normal PO process
could not be used. For example: "part not available from current Purchasing
System vendors and was needed to perform emergency corrective maintenance
of the drive shaft in the Thickener Building". The memo of justification may be
audited by Internal Control.
Please refer to PC 201 Purchasing Card Procedure for additional information.
T&E Cards should be used specifically for travel and individual expense related
purchases. Please refer to PC 213 T&E Card Program Procedure for further
details.
6.2.2 Non-PO Transactions
Types of Purchases not requiring a Purchase Order:
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Approved NON-PO Purchases
Bank/Credit Card Fees
Deposits
Customer Refunds
Taxes (Taxes: includes all taxes paid to local, state and federal governments)
Emergency Materials(Emergency Materials/Services: Includes any materials
or services needed on an emergency basis for which there is no contract or
other method of payment,e.g. a material or service that is required to keep a
plant on-line or provide continued service to a customer.)
Emergency Services (Emergency Materials/ Services: Includes any materials
or services needed on an emergency basis for which there is no contract or
other method of payment, e.g. a material or service that is required to keep a
plant on-line or provide continued service to a customer.) An emergency
would be constituted if critical to keep a facility or process operating.
Legal fees/ professional licenses, including warranties, inspections,
memberships and dues
Freight Only Invoices
Fuel
Garnishments
Health/Casualty Insurance Policies, Bonds, Claims,Administration Fees
Holdbacks/Royalty Payments
Intercompany Transactions
Liquidated Damages-Contract Required
Performance Guarantees-Contract Required
Political and charitable contributions (Refer to the Contribution and
Sponsorship Form)
Political consultants
Pre/Post Employment Tests (Medical/Other)
Utilities (Includes: natural gas, water, electric and other utilities (trash
services, Landline phone services, internet)
Approval of Non-PO invoices:
❑ Due to the nature of non-PO invoices, a minimum of two approvals are
required. A Receiver and Approver with appropriate level of DOA will be
required in the approval workflow.
6.3 Principles of Supplier Selection and Management
Competitive bidding and supplier selection play critical roles in determining whether the company
receives the best value for a given purchase. Both VNA and Veolia Group Procurement (DAG)
teams maintain relationships with key suppliers and negotiate supply contracts for certain
categories of purchases in order to obtain pricing discounts, favorable payment terms and other
benefits from consolidating our spend with certain suppliers. Vendors with which we have pre-
negotiated supply contracts are considered Preferred Vendors. These vendors, who have been
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selected following a rigorous competitive bidding process, should be the primary sources of
supply for the selected category of purchases. In addition to providing value-added benefits, use
of preferred vendors will also simplify the purchase request process, making the process more
efficient for the purchase requester.
If preferred vendors are not available or are not going to be used by a facility, then the facility's
purchase requester(or other appropriate employee)will need to engage in a competitive bidding
process themselves before selecting a supplier. See section 6.3.3 for additional information.
Preferred suppliers can be found under the appropriate purchasing category on the Procurement
Intranet - Find a Preferred Supplier page. The Commodity Manager responsible for the category
of purchases will also be located on these pages.
6.3.1 Supplier Classification
For simplicity, vendors are typically classified as preferred or non-preferred, and it is
recommended that preferred vendors be used whenever possible. However, the more
detailed order of vendor prioritization is shown below in order of decreasing importance:
• Global Partner Suppliers (Preferred Vendors)
• Global Strategic Suppliers (Preferred Vendors)
• VNA Tier 1 Vendors (Preferred Vendors)
• VNA Tier 2 Vendors (Preferred Vendors)
• All Other Suppliers (Non-Preferred Vendors)
The Global Partner and Strategic Suppliers are managed by DAG while the VNA Tier 1 and
Tier 2 Vendors are managed by the VNA Procurement Team. This defines where the
strategic sourcing and supplier negotiations work is taking place but otherwise should not
be visible to VNA purchasers.
6.3.2 Supplier Selection
The supplier selection process must ensure adequate consideration is given to enable the
Company to obtain the most favorable price in relation to quality, quantity, required lead
times and risk in comparison to other available options. While each purchasing category
has different business requirements, as a general rule VNA should partner with suppliers
that:
✓ Provide best total cost of ownership (cost, quality, service, lead-time,
delivery, etc.)
✓ Are well established and financially sound
✓ Are compliant with the law
✓ Have a national/global footprint
✓ Have a broad product offering
✓ Can work with eProcurement tools and processes
✓ Are ethically and environmentally responsible
✓ Are socially responsible; supportive of diversity, equity and inclusion
✓ Have controlled manufacturing and sourcing practices
✓ Other requirements specific to the good or service being procured
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SUBJECT: PURCHASING POLICY
When sourcing for goods or services, a purchase requester should select a Preferred
Supplier or utilize a Punch-out/Catalog supplier where applicable.
Corporate Agreements/Principal Contracts
Procurement Intranet Find a Preferred Supplier page
Using a local or alternate supplier is allowed if a Preferred Supplier is not available for the
needed goods or services, or if the Preferred Supplier cannot meet the requirements of
the particular procurement need (e.g., diversity requirements, specialty parts, etc.). In
such instances, a New Vendor Request Form (EN, FR) will need to be completed for each
new supplier and submitted to the VNA Procurement Team.All approved requests will be
sent to the Vendor Administration Team for implementation.
Please note that the new vendor setup process has multiple steps that need to be
completed by both Veolia employees and the vendor, so it may take 5-10 days for a new
vendor request to be processed and for the vendor to be established in the purchasing
system.
6.3.3 Competitive Bidding
Competitive bidding provides price comparisons between different vendors and ensures
healthy competition for Veolia's business. In general,for the same scope,the lower of the
bids should be selected in order to minimize costs. The difference in price between the
highest and lowest selected bid is considered cost avoidance and is a type of cost savings
that is tracked by VNA Procurement.
When Preferred Suppliers are not used, competitive bids are required in the following
circumstances:
❑ For all non-emergency purchases between $10,000 and $25,000, the Requester
must obtain at least 2 competitive bids prior to making a vendor selection. The
requester may be asked to provide copies of the bids to the Commodity Manager.
The requester will be required to attach the competitive bids to the purchasing
system requisition for record keeping purposes.
❑ For all non-emergency purchases greater than $25,000, at least 3 competitive
bids must be obtained.The requester may be asked to provide copies of the bids
to the Commodity Manager. The requester will be required to attach the
competitive bids to the purchasing system requisition for record keeping
purposes.
In the US,for purchases greater than $1,000,000 USD the requester must engage
the VNA Procurement Team for assistance with the bidding process. As soon as
the purchase need is identified, please email [e-mail] for
further assistance.
❑ In Canada, for purchases greater than $200,000 CAD,the Canadian Procurement
Team must be engaged. Contact [e-mail] for further
assistance.
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SUBJECT: PURCHASING POLICY
The above limits are for the entire contract term and NOT per Purchase Request.
All bid results should be retained and submitted with the purchase requisition for
comparison and auditing purposes.
Exceptions: Competitive bidding is not required for the following scenarios:
• Emergency purchases
• Purchases sourced from a Preferred Supplier or from a vendors with a
valid Veolia supply agreement/purchasing contract
• Specialty items where there is only one available supplier (single source)
or that must be sourced from the original equipment manufacturer(OEM
parts)
• Client-directed purchases IF supporting documentation,such as a copy of
the contract detailing the sourcing requirements, is submitted with the
purchase requisition
• Retrospective purchase requisitions
• Purchases with approved exceptions as defined in Section 6.7
Important Reminder:the selection of legal firms is administered by the Veolia Key Policy
#17 Procurement of external legal services.
6.3.4 Hedging
For highly volatile purchasing categories (e.g., chemicals, electricity, natural gas, etc.),
VNA often chooses to pass through actual costs for these purchases to clients or have
clients purchase them directly without VNA involvement. This serves to reduce VNA's
financial risk associated with purchases that do not have predictable pricing. However, in
certain market conditions and/or with specific legacy contracts, the company may elect
to use progressive hedging as a sourcing strategy in order to reduce the volatility of future
purchases to help maintain profit margins. In these cases, all hedging must be done in
compliance with the Group Policy on Energy and Commodity Price Risk Management.
Please contact your Finance leader or the Group Financial Risk Control department for
additional information.
6.3.5 Independent Contractor and Subcontractor
The Project/Site/Department Manager is responsible for ensuring that all independent
contractors working at a facility have valid and adequate insurance coverage prior to
arriving at the facility to begin work. Evidence of the valid insurance coverage is in the
form of a Certificate of Insurance and should be obtained from the contractor, attached
to the Contract and kept in electronic format. In addition, a Principal Supply Agreement
must be completed. Agreement templates can be found on the Procurement Intranet
page. Once the agreement is in place, the contract company should be set up as a new
vendor in the purchasing system and a PO for the work should be issued. Refer to section
6.3.2 Supplier Selection for information on the new vendor setup process. For additional
assistance, please contact the VNA Procurement Team at [e-mail].
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SUBJECT: PURCHASING POLICY
6.3.6 Insurance requirements
Certificates of Insurance must name the Company and its subsidiaries, if any, and the
owner as additional insured for general liability, builders risk and auto. The minimum
levels of required insurance are specified in the VNA standard Purchase Order Terms &
Conditions or in the negotiated supply contract. Questions related to insurance
requirements should be directed to Veolia's Risk and Insurance Department.
6.3.7 Supplier Charter,Corporate Social Responsibility and Sustainable Purchasing
As part of Veolia's ongoing sustainable purchasing and Corporate Social Responsibility
(CSR) efforts, all suppliers are asked to accept Veolia's Supplier Relationship Charter as
part of doing business with the company. The charter reflects key principles and values
expected from all suppliers, including (but not limited to) commitments around Health,
Safety, Environment, Anti-corruption, Anti-trust regulations, Human Rights, Taxes and
CSR commitments.
Suppliers may also be asked to participate in evaluations of their CSR performance
through CSR questionnaires and 3rd party tools, such as Ecovadis and Bureau Van Dijk
Compliance Catalyst. Information from these assessments may be used to help the
suppliers identify areas of improvement and also to aid in supplier bid evaluation,supplier
selection, and to identify potential compliance and risk management concerns.
For additional information, please refer to the Group Sustainable Purchasing page.
6.3.8 Supplier Contract Signing Authority
Supplier contracts and SOWS with firm spend commitments must be signed by an
appropriate person with adequate DOA as defined in IC 102 Delegations of Authority and
based on the scope of the agreement. For example, an agreement covering a single BU
can be signed by someone with DOA who resides in the BU, while multi-BU agreements
must be signed by all BUs involved or by VNA corporate personnel with the needed level
of DOA. Note that for multi-year contracts,the level of DOA required for approval is based
on the spend for 1 year, not for the total spend over the life of the contract.
Negotiated supplier framework agreements with no volume commitment, exclusivity or
spend commitment should be signed by procurement personnel, typically the Chief
Procurement Officer(CPO) or designee.
All new framework agreements should follow the appropriate VNA supplier contract
templates, available on the Procurement intranet page. Any exceptions to the standard
supplier contract terms must be approved by the VNA Procurement Contracts Manager
or CPO.
6.3.9 Procurement Deal Summary
A Procurement Deal Summary is required for:
• Any contract with an average annual value greater than or equal to $1M USD
($1.25M CAD)
• When a supply contract deviates from the standard approved contract terms and
conditions
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SUBJECT: PURCHASING POLICY
The Deal Summary highlights the benefits and risks associated with the supplier contract
and requires review and approval by the VNA Procurement Team and relevant BU
stakeholders in advance of supplier contract execution. Review of this document by
Corporate Procurement can be initiated by sending the completed Deal Summary to
[e-mail] and should be done at least two weeks in advance of contract
execution need date, unless there are extenuating circumstances.
6.4 Vendor Database Management
The Vendor Database contains key information for all approved suppliers including supplier name,
address, remit to address, payment terms and banking/payment details. The maintenance of,
including additions to, the vendor database is managed centrally by the Vendor Administration
team.
Only authorized individuals have access to add/modify/inactivate supplier files in SAP S/4HANA
and Ariba. Individuals with authority to approve alterations of supplier files cannot also process
supplier payments, satisfying segregation of duties requirements.
Any changes, including additions or modifications, to the supplier database must be properly
authorized and verified by the VNA Procurement Group and/or Vendor Administration Team
through the use of VNA Vendor Request Form (VRF)found at the link(s) below.
Vendor Request Form (EN)
Vendor Request Form (FR)
Inactive or unused vendors for a period of 26 months will be periodically reviewed (at least twice
per year) and inactivated in SAP S/4HANA and the purchasing system. This may be a manual or
automated process as determined by VNA Procurement and in collaboration with IS&T. Inactive
vendors are those who have not had a PO issued, receipt recorded or an invoice paid to them in
the past 26 months. Note that the 26 month timing has been selected due to the bi-annual
frequency of maintenance outages at many VNA facilities in order to prevent inactivation of
vendors used during these critical work periods.
Any modification to the standard payment terms for VNA must be approved by the Chief
Procurement Officer or designee(s). Commodity Managers will review any deviations from
standard payment terms and explain the reason for the request. Some reasons to allow shorter
payment terms could be contractual obligations,size of company or type of product/service being
procured. To find the Commodity Manager for a specific category of purchases, please refer to
the Procurement Intranet Find a Preferred Supplier page.
6.5 Procurement Process Monitoring and KPIs
The VNA Procurement team is responsible for developing and monitoring KPIs that evaluate the
performance of the procurement process. KPIs, which may be monitored by DAG or directly by
VNA, should be updated periodically and used to drive continuous improvement in the efficiency
and effectiveness of the procurement process.
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SUBJECT: PURCHASING POLICY
Potential KPIs may include:
• Contract utilization %
• PO/non PO purchase rate
• Retroactive PO rate
• #of new and active suppliers
• ROSMA (Return on Supply Management Assets)
o Spend coverage
o Velocity or% sourced
o %yield
o %compliance
o Benefits
o Period costs
• Savings- EBITDA, Cost Avoidance, CAPEX
• Etc.
6.6 Training and Additional Resources
Procurement system training is available by request from the IT Support Center (ITSC) as well as
via self-training resources such as webinars,job aids and other instructional documents.
For additional information, please refer to the SAP Ariba page or the Procurement intranet page.
6.7 Exceptions
Any exceptions to this policy must be approved by the VNA CPO, CFO or CEO. To request an
exception, please email the Procurement team at [e-mail] and provide the
details of the request, including business justification:
If an exception is being requested due to a provision in a client contract, please include a copy of
the applicable contract documentation along with the exception request.
7.0 RECORDS
Records in accordance with this Policy & Procedure are maintained within the system and should be
retained by the appropriate function area in conjunction with the applicable record retention policies.
8.0 COMMUNICATION METHODOLOGY
Employee Group Affected: Communication Method:
All VNA Employees involved in procuring goods and E-mail and VNA Intranet Posting
services on behalf of VNA
9.0 COMPANY RIGHTS
The Company reserves the right to amend or rescind, in whole or in part, this policy at any time and
without notice. This policy does not constitute a contract of employment or a promise of benefits or
continued employment.
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SUBJECT: PURCHASING POLICY
10.0 REVIEW AND APPROVAL
Reviewer/Title Revision No. Review Date
VNA Policy Review Committee 1.0 06/24/2016
Procurement Team 2.0 1/31/22
Policy Review Committee 2.0 4/18/22
Approved By: VNA Policy Review Committee
Date: April 18, 2022
11.0 CHANGE HISTORY
Revision No. Summary of changes Issue Date Effective Date
1.0 Initial issuance 17 June 2016 01 July 2016
2.0 5 year review-renamed, reformatted and 1 May 2022 1 May 2022
updated throughout. Changes included:
removal of Appendices, removal of procedural
and BU-specific content, updated to be
consistent with Group guidance
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