Actions We’re Taking Supply Chain

Promote Safety Across
Our Supply Chain

Taking ownership of our own and others’ safety means sharing safety information freely. We believe that safety should not be a competitive advantage, but rather should be communicated across industries. This concept led GM in 2018 to create a Supplier Safety Council, which will serve as a clearinghouse for safety policies and best practices across our supply base. Through this voluntary program, GM suppliers can attend regular forums to learn safety practices that they can take back to their own operations and supply bases. The program is not limited to GM’s direct materials suppliers. Any supplier, from facilities to construction, is welcome to participate and learn. A Supplier Safety Page was created in our supplier portal for suppliers and GM to share best practices on several workplace-related safety topics. The link to this safety page is found here.

Encourage Progress on
Sustainable Natural Rubber
Extend SAIC-GM’s Green Supply Chain to Tire Suppliers

SAIC-GM's Green Supply Chain project has certified hundreds of suppliers, helping them increase their efficiency and decrease their impact on the environment since its launch in 2008. Each year, the initiative focuses on a different group of suppliers, offering training, energy audits and other support. In 2018, the joint venture extended the project to tire and secondary suppliers.

Maxxis Tires and Giti Tire Corporation worked with 35 of their own suppliers, including raw material suppliers. They participated in training and have launched more than 120 energy conservation and emissions-reduction projects. This has resulted in a reduction of more than 30 million kWh of electricity and 17,000 tons of standard coal consumed, which equals 36,000 tons of CO2 emissions avoided per year.

Significant progress is being made by global natural rubber stakeholders in working towards the development of a globally sustainable rubber industry. In March of 2019 General Motors joined with a wide range of stakeholders that included tire makers, rubber producers, other OEMs and representatives of civil society, to officially launch the Global Platform for Sustainable Natural Rubber (GPSNR).

This independent, multistakeholder platform has been formed to lead improvements in the socioeconomic and environmental performance of the natural rubber value chain. GPSNR has now begun the job of working to align standards that will help protect human rights, uphold fair business practices, protect biodiversity and water resources and improve yields, and increase supply chain transparency and traceability.

GM is very proud to not only be a founding member of this group but also to have worked towards its creation, working closely with all relevant stakeholders to ensure that the GPSNR incorporated all elements of the supply chain, as well as key NGOs. Further, we are excited about what can now be achieved by the GPSNR and look forward to being a part of this in the coming years.

There’s no denying the importance of rubber production globally. The industry supports more than 5 million people in Southeast Asia who benefit from the jobs created by its value chain. However, thanks to GM’s connection with the World Wildlife Fund, we now more fully understand the consequences of rubber production. For example, it is one of the leading contributors to deforestation, especially in Southeast Asia. The industry also is susceptible to human rights violations and unethical business practices, including land grabbing and the threatening of wildlife and endangered species across the region.

Manage Raw Material
Supply Chain Risks

As electrification grows in importance to our vehicle portfolio, so too does the focus on cobalt, which is used in lithium-ion batteries. There are concerns around the use of child labor in the mining of cobalt, which would represent a serious violation of our Supplier Code of Conduct and terms and conditions in supplier contracts.

Through our membership in the Responsible Minerals Initiative (RMI), formerly known as the Conflict-Free Sourcing Initiative, we are working directly and actively on a cobalt subteam in the following areas:

  • Developed a Cobalt Reporting Template based on the Conflict Minerals Reporting Template for suppliers to use in identifying cobalt refiners in their supply chain.
  • Developed a Cobalt Reporting Template based on the Conflict Minerals Reporting Template for suppliers to use in identifying cobalt refiners in their supply chain.
  • Defined “cobalt refiner” to help identify the choke points in the cobalt supply chain. This is driven by the limited number of known cobalt refiners. GM has conducted research on potential cobalt refiners and provided this information to the RMI team.
  • Conducting outreach to cobalt refiners, as they are identified, to participate in RMI’s Cobalt Refiner Supply Chain Due Diligence Assessment. This assessment is used to validate that cobalt refiners have systems and processes in place to conduct due diligence in accordance with internationally recognized frameworks.
  • Conducting due diligence of key GM Tier I suppliers to receive assurance from these suppliers that responsible sourcing of cobalt is a top priority.
  • Working with other cobalt associations to recognize RMI’s Responsible Minerals Assurance Process (RMAP) in order to have a common assessment standard for cobalt refiners.

The work we are undertaking in the cobalt supply chain builds off the practices we have established around conflict mineral sourcing. Annual SEC disclosure of conflict mineral sourcing is fully integrated into our business processes. A dedicated team conducts due diligence, analyzes findings and reports conflict mineral information from our supply base that encompasses more than 3,400 supplier locations. Governance processes include a compliance committee of multifunctional GM leaders and an executive steering committee to provide leadership and direction for the program. We have recently set an aspirational goal to achieve a 100 percent response rate from affected suppliers for submissions of the Conflict Minerals Reporting Template.

Beyond our own reporting activities, we work with our own supplier base regularly to increase education and awareness, including conducting periodic webinars and providing a dedicated email contact to answer specific questions. We continue to collaborate with others in the industry to educate suppliers. We co-chair the AIAG Responsible Materials Work Group, which works on common automotive industry solutions with other OEMs and suppliers.

We are involved with several subteams within RMI, including the Smelter Engagement Team. If a smelter/refiner has not been validated as conformant to the RMI audit protocol, then GM sends letters to the smelters or refiners (SORs) to encourage them to participate in this third-party audit. To date, GM has sent letters to 131 smelters/refiners. To further encourage SORs to participate in the audit, GM has made contributions to the not-for-profit RMI Initial Audit Fund in 2017, 2018 and 2019. This fund is used to help offset the costs for the SOR to participate in the RMAP audit.

Work with Suppliers to Deliver
Superior Freight Performance

Freight transport is a significant contributor to GHG emissions, accounting for 16 percent of emissions in the U.S.1 Achieving zero emissions requires addressing this aspect of our footprint, which is why GM has been an EPA SmartWay® partner since 2013. SmartWay helps companies cut emissions from freight shippers and carriers by measuring performance and recommending strategies for becoming more efficient.

Thanks to this partnership, we avoided more than 224,600 tons of carbon emissions between 2015 and 2017. The effort required behavioral changes by our shipping suppliers, such as using new technology that shows a driver the most fuel-efficient route or turning trucks off once they arrive at a GM facility. Due to these changes, GM North America was awarded the 2018 SmartWay Excellence Award, the highest honor for leadership in freight performance. The award recognizes the top 2 percent of SmartWay partners with superior environmental performance. GM is the only original equipment manufacturer represented on the list.

Support Diverse Suppliers
for 50 Years and Beyond

GM has a long legacy of leadership in helping diverse suppliers flourish. In 1968, we became the first OEM to establish a formal supplier diversity program. Over the past five decades, we have spent more than $100 billion with diverse suppliers and contributed to innumerable community initiatives in collaboration with diverse suppliers.

We engage with our suppliers through long-standing events such as Supplier Connections, which attracts more than 1,000 suppliers each year for a day of networking, education and collaboration. GM also holds the annual Supplier Impact Meeting and Awards, which honors suppliers for increasing diversity in their own supply chains.

We’ve also expanded our outreach more recently, such as our partnership with the Michigan Minority Supplier Development Council (MMSDC) to launch UniTier, a new portal that simplifies reporting of Tier II diversity spend, released in 2018. GM was also proud to be recognized with two awards related to supplier diversity in 2018, including:

  • America’s Top Corporations "Gold Distinction" for Women’s Business Enterprises, Women’s Business Enterprise National Council
  • Corporation of the Year, Asian Pacific American Chamber of Commerce
Promote Disclosure Across
Our Supply Chain

CDP (formerly the Carbon Disclosure Project) helps companies better understand and manage climate change, deforestation and water-related risks. This effort goes beyond our own operational footprint to include those of our suppliers. For the past five years, we have engaged our supply chain by inviting a group of suppliers, around 340 in 2018, to participate in CDP’s Supply Chain climate change and water programs. Following is a summary:

Climate
Change
Responses

  • 61% Supplier participation
  • 71% Report active targets for emissions reuction
  • 82% Integrate climate-related issues into long-term business objectives
  • 51% Engage their own suppliers
  • 87% Engage in risk analysis

Water
Responses

  • 51% Supplier participation
  • 61% Report water accounting
  • 67% Report water risk assessment
  • 60% Report a water policy
  • 26% Engage their own suppliers
Manage Supply Chain Impact
Through Life Cycle Analysis

GM uses life cycle analysis (LCA) to better understand the activities of our more than 18,000 suppliers worldwide. Purchased goods and services are our second-highest source of emissions and include the life-cycle emissions from parts purchased from our suppliers.

LCA combined with extended input/output analysis allows us to assess suppliers by industry and by tier to identify where the greatest environmental impacts in our supply chain occur and prioritize our resources. It also helps us monitor and manage sustainability trends within our supply base as automotive technologies change.

Our largest GHG impact occurs among Tier II suppliers.

Direct parts represent 87% of the carbon footprint of a GM vehicle, excluding customer use.

Our largest water impact occurs among Tier III suppliers.

STORIES OF
Transformation
in Progress

Promote Safety
Across Our
Supply Chain

Manage Raw Material
Supply Chain Risks

Work with Suppliers to
Deliver Superior Freight
Performance

Promote Disclosure Across
Our Supply Chain

Encourage Progress on
Sustainable Natural Rubber

Support Diverse Suppliers for 50 Years and Beyond

Manage Supply Chain Impact
Through Life Cycle Analysis