We place high expectations of excellence and ethical conduct on our suppliers, who are expected to act in a way that is consistent with our principles and values.
Supply Chain Compliance
We place high expectations of excellence and ethical conduct on our suppliers, who are expected to act in a way that is consistent with our principles and values. Likewise, GM employees must hold suppliers they work with accountable for acting in a manner that is consistent with our Code of Conduct, Winning with Integrity.
Our Supplier Code of Conduct and purchase contract Terms and Conditions set forth expectations for ethical social, business and environmentally responsible practices. By choosing to do business with GM, our suppliers accept our purchase contract Terms and Conditions. Our Terms and Conditions clearly state our prohibition against any use of child labor or any other form of forced or involuntary labor, abusive treatment of employees or corrupt business practices in the supplying of goods and services to GM.
suppliers participated in supplier compliance surveys in 2020.
We require our Tier I suppliers across the globe to mandate that their direct suppliers meet in-country environmental and safety standards, as well as quality standards.
Furthermore, our contracts lay out expectations for lawful compliance with data protection and privacy, wages, hours and conditions of employment, subcontractor selection, antidiscrimination, and occupational health and safety. GM also expects suppliers to cascade a Code of Conduct in their own value chain.
When we become aware of violations or alleged violations to our Code of Conduct, we are committed to responding swiftly and appropriately, up to and including the termination of business relationships. Suppliers must attest to compliance with our Terms and Conditions, Supplier Code of Conduct and all applicable laws and regulations. GM conducts annual verification surveys to validate adherence to these obligations, and non-compliance is addressed directly with suppliers through its Supplier Champion process. In 2019, just under 600 suppliers were included in the survey. In 2020, participation increased, and survey responses were collected from over 3,000 suppliers, including all of our suppliers for production, logistics, and customer care and aftersales support. In addition, suppliers are asked to confirm via the survey that they have:
- Engaged in company business practices consistent with GM’s Supplier Code of Conduct or a similar code of conduct published by their company.
- Adopted their own code of conduct or similar document expressing a commitment to conducting business ethically, honestly and in compliance with all applicable laws.
- Shared GM’s Supplier Code of Conduct or a similar code of conduct published by their company with their suppliers.
- Implemented a safety policy that is consistent with the principles set forth in GM’s Supplier Code of Conduct.
Supplier responses to the survey are reviewed and escalated, if required, to remediate risk. Additionally, we require our Tier I suppliers across the globe to mandate that their direct suppliers meet in-country environmental and safety standards, as well as quality standards. The foundation of this process is our Built in Quality System (BIQS), consisting of IATF 16949 certification and BIQS Metrics requirements. This foundation allows us to cascade quality standards through tiers of our supply base. We aim for all GM Tier I suppliers to achieve BIQS Level V, the highest level possible. BIQS compliance also encourages these Tier I suppliers to uphold the same quality standards within their own supply bases, since issues here can ultimately affect their quality performance. To support monitoring, suppliers’ IATF 16949 certification status has recently been added to our Sourceability Report, which is a compilation of metrics used to inform sourcing decisions and supplier engagement.
Supply Chain Risk
Improving supply chain visibility is the key to avoiding reactive crisis management and achieving proactive avoidance.
We have an industry-leading, in-house, customized supply chain visibility tool that integrates GM plants, Tier I suppliers, reported Tier II suppliers and logistics nodes. This tool gives our organization the capability to map geographic locations and relationships across the GM supply chain. The tool also incorporates 24/7 monitoring and Global Incident Mapping of potential disruptive events that could impact our supply chain partners worldwide.
Through the use of innovative tools and real-time data analysis, we have improved our response to disruptive events in the supply chain. We monitor for both catastrophic events (e.g., earthquakes, hurricanes) and isolated disruptions (e.g., factory fires, labor strikes), reporting all potential impacts to our command center for analysis and supplier follow-up if necessary. In addition, contracted third-party services provide information regarding financial risk, location risk (i.e., countries, industries and commodities with higher ESG risk), and interdependency risk between our suppliers and extended supply chain tiers. Risk scores are factored into the sourcing process and support mitigation plan development for high-risk areas.
With our monitoring processes in place, GM increasingly has the ability to identify suppliers impacted by events that could potentially disrupt supply. GM’s Supply Chain Risk Management team can react swiftly to notify the appropriate GM Global Supply Chain crisis response teams. These crisis teams then have the ability to work cross-functionally with Tier I suppliers, Purchasing, Logistics and Engineering. This collaboration mitigates the impacts of potential disruptions to inbound material supply. This can be accomplished by resourcing or rescheduling until the supplier is compliant with governmental regulations.
Supply chain risks are managed through GM's risk management functions and processes. Major risks are assessed by senior leaders at least twice a year. Additionally, leadership participates in corporate governance forums, including the Board Risk and Cybersecurity Committee, and the Risk Advisory Council which is responsible for oversight, risk management and mitigation implementation. Strategic initiatives include quarterly risk dashboard updates, annual CEO reviews and annual CEO business unit reviews, annual global risk assessments and Senior Leadership Team interviews.