4 Steps to a More Sustainable Supply Chain
GM’s purpose is to serve our customers and improve the communities in which we live and work. In order to achieve this, we need to think holistically and realistically about our impact and engage our entire value chain, including our supply chain.
Therein lies huge opportunity.
We work with 18,500 suppliers around the world and they in turn work with thousands of other suppliers. Consider their collective impact starting at the raw material level. Working through CDP for greenhouse gas disclosure and Climate Earth for lifecycle analysis, our multi-tiered supply chain produces 10 times the greenhouse gas emissions of our facilities. Carbon equals cost, one way or another, direct or indirect.
As we look beyond our “four walls,” we seek to create partnerships and rely on collaboration to further reduce the carbon footprint of our supply chain. If carbon emissions can be reduced through optimization and greater efficiencies, costs go down, and that makes business sense.
We see four areas of opportunity to create a more sustainable supply chain.
- In search of harmony. A GM supplier might also supply five of our competitors. We need to drive toward harmonization so that these companies aren’t burdened by different requirements for similar sustainability data and information. An industrywide approach is critical to maximizing the value.
- Blood, sweat and tiers. Engaging the suppliers supplying the suppliers who supply the suppliers is a challenge. However, we must drive deeper within the supply chain to realize greater results.
- Demonstrate the value. We want to use carrots, not sticks. We’re looking to create awareness of how sustainability efforts can be a value-add that drives efficiencies, savings and innovation, and/or reduces risk.
- Partner up. The automotive industry has an incredibly complex and global supply chain. One company alone can’t create the supply chain reaction required for the momentum we seek. We’re looking at creating partnerships and collaborations that bring ideas and people together to fuel the movement.
We have a long journey ahead of us, but we’ve made progress in measuring our greenhouse gas emissions across our value chain. As a result, these emissions are being managed and we’re seeing emission reductions and cost savings. From creating our GM Green Dealer program to supporting CDP Action Exchange; joining EPA’s SmartWay Partnership to participating in ENERGY STAR forums; and leading Automotive Industry Action Group meetings, we enable the sharing of best practices in areas such as energy management and greenhouse gas reporting.
Through these partners and many others, we champion and facilitate better performance all around. This can mean being more energy efficient, lower carbon intensity, less miles traveled – all of which saves money. What’s the end game? When aggregated up the value chain, that means a more affordable product for our customers and/or lower costs to own and operate our products.