Sustainable Supply Chain

To meet evolving market expectations, we continue to improve traceability across our sourcing activities. Our internal management systems now enable tracking of raw materials by batch number up to tier-2 suppliers.

At FPS, building a sustainable and resilient supply chain is central to our operational strategy and long-term commitment to responsible sourcing.

We collaborate with 1700 suppliers worldwide to ensure that our operations remain robust, adaptable, and aligned with environmental and social standards.

We operate with a resilient supply chain across 18 countries, supported by an extensive and integrated global manufacturing and distribution network.

This structure allows us to provide localized customer service and technical expertise while maintaining consistency in quality, safety, and sustainability.

To meet evolving market expectations, we continue to improve traceability across our sourcing activities. Our internal management systems now enable tracking of raw materials by batch number up to tier-2 suppliers. Enhanced site visits and monitoring processes further strengthen our ability to verify material origin and uphold supply chain accountability.

Supplier Code of Conduct

Our expectations of suppliers are clearly outlined in our Supplier Code of Conduct, which is supported by our Global Policy on Sustainable Procurement.

The Code covers key areas such as human rights, fair labor conditions, legal compliance,
anti-corruption, and environmental responsibility. It applies to all suppliers, including raw material providers and third-party manufacturing partners.We request all targeted suppliers to formally sign and adhere to this Code.

As of 2024, 83% of our targeted suppliers had signed the Supplier Code of Conduct. Our goal is to achieve 100% adoption by 2026. We continue to follow up with remaining suppliers and integrate these requirements into ongoing supplier qualification and onboarding processes.

For more detailed information, please refer to the Supplier Code of Conduct.

Supplier Evaluation and Engagement

We categorize our supply partners into two main segments: raw materials and ingredients, and external manufacturers. Supplier management is coordinated at both global and regional levels. The Business Development Director oversees overall progress and regularly reports to the CEO, while regional procurement teams maintain continuous contact with suppliers and provide quarterly updates to leadership.

Our supplier assessment model incorporates a wide set of criteria to evaluate risk and performance. These include geographical location, regulatory compliance, adherence to our Supplier Code of Conduct, recognition in the market, membership in platforms like Sedex, the availability of publicly disclosed sustainability reports, and ESG ratings.

Suppliers located in countries with a GSCI score above 55 are considered very low risk, while those in countries scoring below 40 are classified as very high risk. Similarly, suppliers with strong compliance records, widely recognized market presence, and third-party validated ESG ratings are assessed more favorably.

New suppliers go through a structured onboarding process that includes self-assessments, sample testing, on-site visits, and contract finalization. Audits are used to verify conformity with international standards such as ISO 9001, ISO 14001, BRCGS, and FSSC 22000. Where areas of improvement are identified, we provide direct feedback and request corrective actions.

In 2025, 29 suppliers were evaluated through this procedure, and none were classified as high risk.

To further strengthen our approach to third-party risk management, we use the NAVEX Risk Rate Enterprise Due Diligence module, which provides a structured framework for identifying and mitigating risks associated with supplier engagements.

Recognizing that third parties can introduce significant operational and reputational risks, this system supports comprehensive due diligence procedures.

Action Plan for High-Risk Suppliers

Although no high-risk suppliers were identified in 2025, we have a defined procedure in place in case such cases arise. When a supplier is classified as high risk based on our ESG assessment, we initiate direct engagement to discuss the findings in detail. We clearly communicate the areas of concern and emphasize the importance of addressing them.

We then work collaboratively with the supplier to develop a tailored ESG risk mitigation plan. This plan outlines the specific issues to be addressed, as well as the actions, timelines, and responsibilities necessary for improvement.

To support capacity building, we provide training sessions and practical resources to help suppliers align their practices with ESG expectations. We also share relevant industry standards, best practices, and legal requirements to guide their improvement journey.

Where needed, we adopt a collaborative problem-solving approach, working alongside the supplier to overcome implementation challenges and identify practical solutions. This structured response ensures that our expectations are clearly understood and supported by active cooperation.

Contingency and Nearshoring Strategies

To support supply chain continuity, we maintain contingency plans that enable quick transitions in response to geopolitical or market disruptions. During the Ukraine conflict, we swiftly adapted by sourcing from alternative suppliers. We also classify suppliers by material type instead of geography to increase flexibility.

As part of our long-term resilience planning, we continue to pursue nearshoring strategies, working with suppliers closer to our manufacturing hubs to reduce transport-related risks and emissions, improve lead times, and enhance responsiveness. Through these integrated practices, we aim to strengthen our supplier relationships while promoting transparency, risk awareness, and responsible growth across our value chain.