Ford is committed to reducing the environmental footprint of our supply chain, as well as our vehicles and our operations.
Understanding Our Suppliers’ Environmental Impact
To better understand the greenhouse gas (GHG) emissions and water use of our supply base, we survey a selection of suppliers every year using the CDP Supply Chain program’s questionnaires. The selection of production and indirect suppliers invited to participate is based on a combination of:
- The GHG or water intensity of their activities or the commodities they supply
- The geographic footprint of the supplier’s global operations, including those in water-stressed or water-scarce regions
- The strategic nature of the supplier’s relationship with Ford
In 2015, we surveyed approximately 250 production suppliers covering various commodities and geographical regions, as well as indirect suppliers of logistics and information technology services.
Since 2014, they have also been invited to respond to the CDP Water questionnaire. Together, the two questionnaires provide qualitative and quantitative information about our suppliers’ management of climate risks, GHG emissions and water use.
2015 Survey Results
CDP Supply Chain Questionnaires (GHG and Water Data)
|Number of suppliers surveyed||145||250||250|
|% of Ford’s annual spend||52||57||64|
Our response rate of 81 percent was much higher than the average for all companies participating in the CDP’s programs (50 percent). We attribute this high response rate to the support we provide to suppliers through webinars, guidance documents and technical assistance. This engagement includes a one-day supplier training program for calculating, allocating and reporting GHG emissions that was developed through the Automotive Industry Action Group (AIAG).
The number of Ford suppliers reporting GHG reduction targets on both an absolute and intensity basis continues to increase. In 2015, 66 percent reported having an emissions reduction target, and 78 percent reported integrating climate change into their business strategy. In addition, 41 percent of our respondents reported a water-related target or goal.
Supplier Water Use by Industry Sector
CDP Supply Chain Data: Total Annual Ford Allocated Water Use
Water use per supplier (Average of 2-5)
Supplier Emissions by Industry Sector
CDP Supply Chain Data: Total Annual Ford Allocated GHG Emissions
Average top 5 suppliers in each category
The ongoing data obtained through the CDP surveys has helped us identify “hotspots” for GHG emissions and water use. These suppliers have been targeted to participate in the Partnership for a Cleaner Environment (PACE) program.
Building Supplier Capability
Our supply chain sustainability initiative – the PACE – was launched in 2014 to reduce the collective environmental footprint of Ford and our supply chain.
Our goal is to share leading energy, GHG emission and water reduction initiatives implemented in our own manufacturing plants, enabling suppliers to replicate best practice, minimize their impacts on the environment and report their sustainability performance to Ford. To amplify the impact down the supply chain, we also encourage our Tier 1 suppliers to share these leading practices with their own suppliers.
A pilot program with a select group of 10 suppliers was completed in February 2015. Since then, we have extended PACE to include a total of 25 strategic suppliers representing 800 manufacturing sites in 41 countries.
“By implementing select best practices from Ford, Lear expects to realize cost savings at its facilities worldwide. But the true impact will be Lear’s contribution to helping protect the environment because, at the end of the day, Ford’s PACE program is not just about sustaining its business, but about doing the right thing.”
The PACE Process
- Suppliers create multi-year roadmaps for improving environmental performance
- Baseline environmental data is entered into the roadmap
- Leading practice approaches are selected and implemented
- Reductions in GHG emissions or water use are calculated, and progress against the baseline is reported
- Leading practice examples, implemented by our suppliers or our own facilities, are updated and periodically shared
Collaborating with Industry Partners
To magnify our efforts and encourage common approaches to environmental issues in the automotive supply chain, we participate in several industry forums.
- Ford founded and co-chairs the AIAG’s Environmental Sustainability Advisory Group, which helps to develop common metrics, standards and benchmarks to improve the effectiveness of member companies’ and industry groups’ sustainability efforts. The group educates suppliers and manufacturers about key environmental issues and serves as a “think tank” on environmental sustainability.
- Ford also worked with the AIAG’s Greenhouse Gas and Environmental Sustainability Advisory Group to integrate environmental sustainability and GHG management issues across the industry.
- Ford serves as a member of the Suppliers Partnership for the Environment, a collaboration among automotive OEMs, their suppliers and the U.S. Environmental Protection Agency.