Operating with Strict Standards

Chesapeake is dedicated to maintaining an ethical, safe and high-performing supply chain process. We recognize that supplier relationships, and the proper management of these relationships, are critical to responsible corporate performance. 

Our centralized Supply Chain Department manages the onboarding of our suppliers, while leveraging our full purchasing power to maximize value for the company. As a domestic operator, nearly all of our suppliers are U.S. based. We spend a majority of our supply chain budget on services, with additional budget dedicated to goods and materials ranging from tubular and related steel goods to office-based products and software. 

To become a Chesapeake supplier, a company participates in a prequalification process during which its safety and environmental performance is evaluated. Should a supplier pass prequalification, Chesapeake engages in a more thorough evaluation involving experts across the company. This evaluation includes, among other things, a study of the potential supplier’s safety and environmental records and company financial performance. The prospective supplier must also agree to abide by Chesapeake’s Supplier Code of Conduct before approval. 

In 2017, the Supply Chain team created a risk-based program to reevaluate approved suppliers on a rolling basis. This model provides a framework that will encourage more frequent recertification for those suppliers with higher risk profiles. 

Upholding Our Supplier Code of Conduct

Once companies are accepted as qualified partners and selected to work for Chesapeake, their conduct is subject to our Supplier Code of Conduct. This code mandates that all business partners share Chesapeake’s commitment to providing a safe and ethical workplace and conducting operations in an environmentally responsible manner. It also communicates methods for reporting concerns and ethical issues. Suppliers receive a copy of our code as early as prequalification, and once contracted, companies often participate in a code training session to further understand Chesapeake expectations.  

A key outcome of abiding by the Supplier Code is a safe work site. For example, according to the Supplier Code, drug and alcohol possession and use are strictly prohibited on company locations. Suppliers and their employees agree to these standards, and Chesapeake’s Security team monitors sites regularly for compliance. In 2017, Chesapeake Security conducted 19 rig checks and randomly drug tested 676 people on Chesapeake locations. As a result of these inspections, certain individuals and suppliers were permanently prohibited from working at Chesapeake sites.