Drive sustainability is an automotive partnership which aims to drive sustainability throughout the automotive supply chain by promoting a common approach within the industry and by integrating sustainability in the overall procurement process. If you are an automotive supplier, it is highly likely that you will have to answer to request from them.
Drive sustainability: 11 automotive manufacturers with a common vision
Drive Sustainability is an Automotive Partnership between BMW Group, Daimler AG, Fiat Chrysler Automobiles, Ford, Honda, Jaguar Land Rover, Scania CV AB, Toyota Motor Europe, Volkswagen Group, Volvo Cars and Volvo Group.
Their common direction is:
- “Have a common and unified position, understanding and commitment on supply chain sustainability towards suppliers, other partners and stakeholders
- Develop and implement common activities & tools that can drive changes and impact
- Encourage, promote and work together to have a common approach and process on supply chain sustainability throughout the industry
- Strive to embed sustainability into company procurement processes throughout the industry”
Drive sustainability: action plan and how it may impact your company
To achieve their strategy, Drive Sustainability has set up an action plan [1], split between two periods of time: 2020 to 2025 and 2025 to 2030. The action plan is made of five main axes:
- Sustainable Supply Chain, Drive Sustainability aims at “setting up and promoting use of common standardised tools, methods and common requirements to integrate sustainability into the procurement process”. From 2025, supplier sustainability is a “key decision criterion”. Drive sustainability uses the tool “SAQ”, the Self-Assessment Questionnaire. [2] Each OEMs has their own requirements in terms of scoring and specific priorities, but in the future, there might be consensus here. In any case, DFGE recommends fulfilling the main requirements of the SAQ, which are mainly to have corporate policies & governance, specific processes and trainings as well monitoring and reporting KPIs on the different sustainability topics.
- Sustainable raw materials: “Set-up and promote use of common standardised tools, methods and common requirements to integrate sustainability into the procurement process, to reach optimum transparency and traceability”. Companies might have to set up a program to screen their supply chains for specific products, similar to conflict mineral [3] programs where companies need to screen whether gold, tantalum, tungsten and tin is helping to finance conflict in the DRC region.
- Workforce well-being: “agree on and promote use of a common standardised Business and Human Rights due diligence tool/s and a grievance mechanism to proactively tackle issues”. Companies may have to carry out due diligence in their own supply chain. The European Commission announced earlier this year that it would present a legislative proposal on mandatory human rights and environmental due diligence in early 2021 [4]. In this regard, there are already due diligence legislation at national level e.g. in the Netherlands, France or the UK and Germany now considers implementing the Lieferkettegesetz – due diligence will be a topic in the next future.
- Carbon neutrality. “Agree on and promote use of a common standardised method and tool to measure and reduce emissions in the supply chain, as well “Implement impact key projects with the aim to reduce emissions in the automotive supply chain.” Companies will need to assess their own carbon footprint emissions, at corporate level and product level and work with the OEMs on specific projects to reduce the emissions. DFGE recommends companies to set up their own climate strategy [5] to address these topics. To discover more about the automotive requirements for the supply chain please visit Automotive OEM Climate Strategy and their impact on Suppliers – DFGE – Institute for Energy, Ecology and Economy or Die Automobilindustrie auf ihrem Weg zur Klimaneutralität – DFGE – Institute for Energy, Ecology and Economy (In German only).
- Circular value chain: “Set up and roll out learning network on priority issues”. Here there might be possibilities to contribute to such learning network or benefit from it
Drive Sustainability addresses the current sustainability faced by the automotive supply chain as a whole, with a common approach, in order to streamline existing tools and leverage actions.
DFGE is looking forward to seeing the progress of such a partnership and how their strategy is being implemented in the future.
[1] https://www.drivesustainability.org/drive-sustainability-strategy/#our-actionplan
[2] https://www.drivesustainability.org/wp-content/uploads/2020/11/DS_SAQ-FORM2019_24112020_EN.pdf
[3] https://www.sec.gov/opa/Article/2012-2012-163htm—related-materials.html
[4] https://www.lexology.com/library/detail.aspx?g=6789ecd3-e98a-42e7-857a-00dbc369a098
[5] https://dfge.de/wp-content/uploads/2021_DFGE_Klimastrategie_eng_1.1_web.pdf
