Contracts for new suppliers incorporate Equitrans’ Code of Conduct and Supplier Code of Conduct to ensure our standards and expectations are clear. Our Code of Conduct details Equitrans’ standards on ethical behavior and provides resources to address any Code of Conduct questions or concerns. Mirroring Equitrans’ Code of Conduct, our Supplier Code of Conduct requires Equitrans' suppliers to confirm their commitment to a broader set of social workforce policies, including topics such as anti-corruption and discrimination.
Each year, typically during December, Equitrans sends a compliance letter to remind select suppliers of our Supplier Code of Conduct requirements. The list of supplier recipients is based on certain criteria and excludes suppliers with whom Equitrans has spent less than $10,000 annually and/or law firms that must follow their own Code of Conduct as part of their licensing. In 2022, Equitrans utilized a total of 965 suppliers and 787 of those suppliers received an annual compliance letter from our legal and compliance team.
Every three years, Equitrans' supply chain team takes additional steps to ensure our suppliers and contractors receive the most current Supplier Code of Conduct, and each supplier/contractor is required to sign an electronic acknowledgment form. In addition, Equitrans communicates policy updates to our suppliers and contractors through ISNetworld and several internal contractor liaisons. Furthermore, on an annual basis, suppliers are reminded of their commitment to honor the Supplier Code of Conduct through receipt of the annual compliance letter.
New suppliers receive a master agreement and our Supplier Code of Conduct, which outlines Equitrans’ Human Rights Policy and reinforces our expectation for ethical, legal, and socially responsible business practices. Additionally, depending on the anticipated monetary spend and scope of work, a supplier’s credit review and insurance documents may also be reviewed before work begins. These measures are designed to ensure that our contracted workers are protected and treated fairly.
In 2022, a total of 787 suppliers received the Company's annual compliance letter, reminding them of their commitment to honor Equitrans' Supplier Code of Conduct.
Anyone outside of Equitrans is able to report a suspected violation of the Company’s Code of Conduct and is able to do so anonymously if they so choose. Each of our suppliers receive information regarding how to report a suspected compliance violation, which can be done via phone using our toll-free Compliance Hotline (844-513-8109) or online via the EthicsPoint platform. When an instance of non-compliance is reported, Equitrans’ Compliance Network, consisting of leaders from our legal, human resources, and environmental teams, will undertake an investigation. The responsibilities of our Compliance Network include facilitating compliance with laws, regulations, and Equitrans’ Code of Conduct and policies.
Equitrans practices zero tolerance when it comes to compliance. Should Equitrans find a compliance issue, we work diligently with the supplier to resolve and re-establish compliance. If a resolution cannot be achieved, suppliers that are found to be non-compliant with Equitrans’ requirements are subject to immediate remedial action or contract termination. In 2022, the Company terminated one contract with a supplier due to safety deficiencies; removed two contractor employees from Equitrans projects for improper time reporting; and paused work with another supplier due to a human rights violation.
Equitrans Midstream has a zero-tolerance policy for any form of human rights abuse, including forced labor, child labor, and harassment or discrimination. Given the nature of our business activities within our existing operational footprint, Equitrans does not generally encounter a significant human rights risk. Regardless, this does not diminish our commitment to respect human rights in all our actions with employees, local communities, customers, and other stakeholders. We work with our business partners to ensure they share our commitment and have similarly rigorous policies and protection measures in place. Equitrans contributes to the preservation of human rights through:
- Promoting inclusion
- Having zero tolerance for discrimination
- Protecting employees’ rights to form unions and collectively bargain
- Prohibiting the use of modern slavery, human trafficking, forced labor, and child labor
- Guaranteeing fair work hours, compensation, and benefits
In early 2023, Equitrans elevated the organization’s awareness of human rights and environmental justice by launching a Companywide training program, which is mandatory for all employees and available to our contractor workforce. Additionally, we expect to conduct appropriate due diligence to ensure we maintain our commitment to protecting human rights and will strive to create open channels of communication with anyone potentially impacted by our activities. For information regarding our commitment to human rights and environmental justice, please see our Human Rights Policy and Environmental Justice Policy.
Equitrans’ commitment to diversity and inclusion extends to our supply chain. As an element of our sourcing practices, 99% of our supply source is from the United States, and, in 2022, 60% of Equitrans’ total supply chain budget was utilized on local suppliers. Equitrans defines a local supplier as any materials or service provider that receives payment in one of our primary operating states of Pennsylvania, West Virginia, or Ohio.
We recognize that utilizing a diverse range of suppliers benefits the local community, as well as the viability of the overall economy, and we emphasize the inclusion and support of local suppliers, which helps us reduce our environmental footprint and gain valuable insight into the culture of our operating areas.
In 2022, 60% of Equitrans’ total supply chain budget was utilized on local suppliers.
As part of our evaluation, we also include diverse-owned organizations when feasible. Since 2018, Equitrans’ share of expenditures awarded to minority-, women-, and veteran-owned businesses has been steadily monitored and tracked, and we continue to seek opportunities to build on our existing supplier base, while establishing new relationships with diverse suppliers.
Equitrans tracks, analyzes, and reviews supply chain data on a routine basis to identify gaps and areas of improvement, and we continue to identify ways to increase diversity in our sourcing activities. The hiring and management of Equitrans’ suppliers is contingent on their ability to adhere to our Code of Conduct and Supplier Code of Conduct, as well as to applicable laws and regulations, and safety and environmental, social, and governance (ESG) standards. Through our online supplier management database, ISNetworld, suppliers must undergo an extensive onboarding process. Our supply chain and safety departments collaborate to identify appropriate grading requirements and determine Equitrans’ supplier scorecard. New suppliers must submit questionnaires, safety programs, and insurance documentation for review and are required to achieve a passing grade before we execute a master agreement or issue purchase orders.
In 2022, approximately 69% of our suppliers completed Equitrans’ sustainability practices survey.
All suppliers registered in ISNetworld receive questions from Equitrans regarding their approach to environment, social, and governance principles, including their associated practices and performance. Ultimately, we select third-party organizations that are able to effectively perform the required services or provide the goods sought, while also believing in and abiding by Equitrans’ Core Values and demonstrating respect for human rights. We also prioritize suppliers that focus on safety performance and compliance, diversity and inclusion, and environmental stewardship. When we work with businesses that share our values, we are able to build trust and create lasting relationships, which contribute to our long-term success and sustainability goals.
In 2022, Equitrans partnered with a third-party to collect survey data regarding our supplier companies’ sustainability programs. Approximately 69% of our suppliers completed the voluntary questionnaire, giving Equitrans more visibility into the maturity of their sustainability practices and programs. Building on this evaluation, we are developing an Equitrans-specific sustainability questionnaire for critical suppliers.
Equitrans is committed to the safety of our contractor partners, employees, and the environment, and we work to uphold our requirements by encouraging an open dialogue with our suppliers should an issue arise. We take our Code of Conduct, Supplier Code of Conduct, and safety and ESG standards seriously, and we expect all contractors and suppliers to uphold our Core Values.