Integrating
Sustainability Into
Our Supply Chain

In this section

GM is driving toward an all-electric future with a vision of everybody in. This vision extends beyond GM and includes our suppliers. We know that only with our suppliers’ commitment will we achieve our vision of zero crashes, zero emissions and zero congestion.

We take pride in knowing that many of our suppliers are dedicated to protecting our planet and fostering healthy work environments. In recognition of this commitment, in 2021, we began inviting Tier I suppliers to sign General Motors’ Environmental, Social and Governance (ESG) Partnership Pledge. Our ESG Partnership Pledge embraces sustainability in a holistic manner, focusing on commitments related to environmental, social and governance topics. Suppliers pledging to improvements in these three pillars helps us all accomplish our shared goals of reducing economy-wide carbon emissions and serving our communities.

We ask suppliers to provide near-term results by obtaining a minimum score of 50 in the EcoVadis Human Rights, Ethics and Sustainable Procurement Pillars.

For the environmental pillar, we ask suppliers to commit to carbon neutrality for their Scope 1 and Scope 2 emissions relevant to products or services a supplier provides to GM. The timeline for a supplier to reach carbon neutrality is based on their industry, listed at right. GM selected the listed carbon neutrality dates for each supplier industry based on the technology available to achieve a realistic yet ambitious glidepath.

For the social pillar, we ask suppliers to achieve or exceed a threshold score within the EcoVadis system in the areas of Labor and Human Rights as well as Ethics. Likewise in the governance pillar, suppliers are asked to achieve or exceed a threshold score in the area of Sustainable Procurement within EcoVadis. These scores show a supplier’s commitment to developing a comprehensive social responsibility program as well as robust environmental and social programs within their own supply chains.

Timeline to Achieve Aspirational Carbon Neutrality by Supplier Category

By 2025 or sooner

Professional Services
Suppliers working predominantly
in offices providing software/nonmaterial goods

By 2035 or sooner

Manufacturing
Suppliers providing vehicle components and purchased equipment

By 2038 or sooner

Raw Materials/Logistics
Suppliers in carbon-intensive industries providing raw materials or primary resources and services that are focused on freight and transportation

The cross-functional GPSC Sustainability Team is leading efforts to integrate sustainability into all aspects of our supply chain. Focus areas include culture and communication; energy; finance; strategy and policy; supplier engagement; supplier performance and reporting; supply chain; packaging and logistics; and sustainable materials.

We recently announced the GM Supplier Renewable Energy Solutions program in collaboration with Shell Energy. This innovative energy pilot program offers certain suppliers special pricing on renewable energy for electricity, along with other benefits such as complementary carbon tracking. All participants in the program will receive 5% Renewable Energy Credits (RECs) matched to their energy use, and CO2 tracking. Plus, they have the option to purchase additional RECs to help address their carbon footprint efforts.

Another key achievement in 2021 was the publication of a GM Sustainability Partner Guide and Framework to our Tier I suppliers, which communicates our supply chain goals, priorities and processes. The guide outlines GM’s approach to sustainability and includes increasing levels of engagement from our suppliers with four distinct levels: compliance, commitment, growth and leadership. Both the guide and framework are available to suppliers through SupplyPower, the GPSC sustainability portal.

The framework addresses environmental, social and governance topics and allows for supplier-specific goals based on their materiality assessments. Some goals are universal for all suppliers, such as year-over-year carbon reduction targets. The framework also contains requirements that support GM’s vision for more sustainable materials in our products, packaging and logistics, as well as overall supplier sustainability within their own operations. GM’s Supplier Sustainability Framework defines how we measure sustainability goals within our supplier purchasing program.

GM’s Supplier Sustainability Framework enables us to assess sustainability within our Tier I supplier community, including Strategic Supplier Engagement (SSE) and key indirect and logistic suppliers. Additionally, it creates a pathway for GM suppliers to take increasingly bold steps toward a more sustainable future. The framework is comprehensive and inclusive of our Tier I suppliers, allowing each supplier to be recognized for supporting GM’s sustainability goals.

Assessing Performance

In 2021, we furthered our commitment to create a more sustainable supply chain by working with EcoVadis to rate and understand the sustainability performance of our supply base. EcoVadis allows us to gain visibility of the management systems suppliers have in place to support advancement of the environment, labor and human rights, ethics and sustainable procurement. Working with our suppliers and EcoVadis through their platform, scorecard and performance improvement tools in 2021, we have established a sustainability performance benchmark representing 83% of GM’s Direct Tier I strategic spend. The average score of all GM’s rated suppliers is 51.7 out of 100, which is 15% (or 8.1 points) higher than the average of all suppliers rated by EcoVadis in 2021. Moving into 2022 and beyond, with the integration of EcoVadis in 2021, GM is setting expectations to drive rapid supplier sustainability improvement to meet our ambitious supply chain sustainability goals.

General Motors Sustainable Purchasing Program
Supplier Goals Framework

Level	All Tier 1 Suppliers	Enrolled Suppliers*
Level 0 Compliance GM’s baseline requirements for our suppliers.	All Tier 1 SuppliersTerms and Conditions Supplier Code of Conduct	Enrolled Suppliers*Score in EcoVadis CDP participation Industry specific participation (e.g. GPSNR)
Level 1 Commitment Making sustainability a priority, creating alignment, setting goals and achieving results.	All Tier 1 SuppliersMateriality assessment Goals in all 3 sustainability pillars (relevant, impactful, transparent, improving, United Nations Sustainable Development Goal (UN SDG) linked)	Enrolled Suppliers* ≥ 3% year-over-year absolute CO2 reduction (Scope 1 & 2) Actively support GM’s commitment to sustainable materials and packaging Strong social sustainability commitment
Level 2 Growth Furthering commitment while expanding sustainability into one’s supply chain.	All Tier 1 Suppliers ≥ 4% year-over-year absolute CO2 reduction (Scope 1 & 2) Sustainable procurement program Supplier to cascade goals into own supply base Minimum ratings (CDP, EcoVadis)
Level 3 Leadership A true accomplishment, recognizing a supplier as a pacesetter in sustainability.	All Tier 1 Suppliers Industry Leader Leading innovator Ambitious targets (Scope 1, 2 & 3, SBTi, Zero Waste) Proactive actions Life cycle assessment (full)

* Initial enrolled suppliers to include SSE suppliers, key indirect and key logistics suppliers.

CDP Supply Chain Initiative

GM has participated in the CDP supply chain since 2013. We are working with CDP and our suppliers to accelerate action on the environmental front. CDP supports companies in measuring and managing their impacts on climate change, deforestation and water-related risks. GM’s participation in CDP goes beyond our own operational footprint to include information from select suppliers.

Enrolled suppliers in the CDP initiative include all direct material strategic suppliers, a subset of indirect suppliers who are mainly manufacturing-based suppliers and our top strategic logistics suppliers. This group represents more than 80% of our supply chain spend.

During the past two years, we have set a goal of increasing participation among in-scope SSE and key logistic suppliers year-over-year. In 2021, our response rate rose to more than 99% of surveyed suppliers, exceeding previous years for the Climate Change questionnaire. We aim to achieve 100% participation for targeted suppliers in 2022.

As we are all met with the realities and consequences of climate change, our deep relationships with suppliers will help us innovate to find industry solutions. The issues we face today cannot be solved by one company, or even one nation, which is why at GM we are taking an ‘everybody in’ approach that includes each one of our suppliers.”

SHILPAN AMIN
GM Vice President, Global Purchasing
and Supply Chain—Introduction of GM Sustainability Partner Guide and Framework (2021)

CDP Supply Chain Response

Climate Response

99% response rate from enrolled suppliers

50% of suppliers engaging their own suppliers

$2B annual monetary
savings from
emissions reductions

61% reporting active
targets

465.27M (metric tons)

estimated annual
CO2e savings

Water Response

78% response rate from enrolled suppliers

25% of suppliers engaging their own suppliers

76% reporting active targets and/or goals

48% reporting any water-related policy

70% reporting water accounting

Managing Supply Chain Impact Through Life Cycle Analysis

Life cycle analysis, using environmental extended input/output analysis from the U.S. Environmental Protection Agency (U.S. EPA) EEIO 2.0 database, allows us to estimate the environmental impacts of our 18,936 suppliers. The analysis is broken down by industry and tier to identify which products in our supply chain contribute to greenhouse gas (GHG) emissions, water consumption and land use.

Supplier GHG Impact by
Vehicle Component¹

TIRES & wheels 6%

powertrain 35%

glass 1%

body 28%

interior 26%

seats 4%

GHG Impact by Supplier Tier & Industry

In our supply chain, the largest GHG and water impacts occur among Tier II suppliers. Purchased goods and services represent 13%² of our total carbon emissions which we are working to reduce.

Bar chart showing the percentage of GHG and Water impacts among our Tier 1, 2 and 3 suppliers

We analyze environmental supplier impacts at the vehicle component level to identify potential priority areas for carbon reduction. This helps us monitor and manage sustainability trends within our supply base as automotive technologies change.

Bar chart showing the percentage of GHG and Water impacts among our supplier industries

GHG Data is for calendar year 2020 and represents our most recent analysis. The analysis excludes our Joint Ventures.
Includes purchased goods and services Scope 3 category one.

Supplier Engagement and Training on GM Environmental Standards

The GPSC Sustainability Team employs multiple avenues for supplier engagement on environmental topics, as the following examples demonstrate.

Energy Treasure Hunts

We conduct energy treasure hunts with suppliers to drive energy- and water-reduction efforts at Tier I and Tier II supplier facilities. The program’s success is embedded in its collaborative framework, identifying potential energy reduction and financial savings opportunities at suppliers’ manufacturing facilities. In 2021, GM conducted this analysis with five suppliers: Lear, Kongsberg Automotive, Superior Industries, Tenneco and Adient. These treasure hunts collectively provided recommendations to save 3,300 MWh of energy and 6,660 cubic meters of water, as well as eliminating 3,158 metric tons of CO2 emissions.

Sustainable Steel Summit

As we continue to examine our environmental impact, we recognize steel is a major contributor to carbon emissions. In order to address this impact, GM hosted our first Sustainable Steel Summit focused on engaging key steel suppliers in a collaborative discussion about the industry’s most pressing issues, including carbon emission reduction strategies. The Summit began with a leadership kickoff message, followed by emerging renewable energy for electricity technology, a look into GM supplier sustainability and a carbon neutral roadmap. It concluded with a moderated discussion with all attendees. GM leadership facilitated the discussion topics around the challenges of moving toward “green steel” and next steps in developing a shared sustainability plan with GM material partners. The summit helped solidify GM’s partnership with steel supplier Nucor, effectively becoming the first customer for Econiq, Nucor’s new range of net zero carbon steel products.

Energy Symposium

Also in 2021, we held an Energy Symposium focused on renewable energy and carbon neutrality. The two-day event provided insight into renewable energy for electricity as a sound business decision. The GPSC Sustainability Team, suppliers and stakeholders discussed carbon neutrality and highlighted immediate tangible opportunities and resources available to accelerate action. The first day was open to the public; employees, suppliers and stakeholders invested or interested in carbon neutrality and renewable energy were invited to join. The second day was directed toward energy conservation practitioners—site energy leaders and utility managers.

SmartWay Transport Partner - Getting There With Cleaner Air

Sustainability in Logistics

GM participates in various freight sustainability programs, including the EPA’s SmartWay Partnership, which we have been a proud member of since 2013. In 2021, we increased our engagement with the SmartWay program by encouraging all our eligible logistics suppliers to join. As a result, participation in the program increased by one-third, with a commitment from U.S. and Canadian carriers that represents 99% of our truck and rail spend. Through participation in Transporte Limpio, a freight efficiency program administered by Mexico’s Secretariat of Environment and Natural Resources, we are expanding freight efficiency efforts to include Mexican truck carriers.

Our GM Logistics Team aggressively evaluates our logistics network for optimization opportunities, studying methods for improving efficiency and emissions reduction through redesigning routes, changing modes and adjusting frequency. In 2021, the team implemented a program to include emissions metrics in business case analyses. The integration of carbon calculation methodology allows for increased visibility of CO2 emissions when reviewing and considering various network scenarios.

Our GM Logistics Team is also focused on increasing collaboration with our carriers, industry leaders and peers. In 2021, GM held its first Global Logistics Sustainability Workshop with approximately 500 attendees from 150 logistics suppliers. Also in 2021, the EPA invited our GM Logistics Team to speak at a SmartWay webinar to share our sustainability journey with more than 100 companies from a range of industries.