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Environmental Impact of Our Suppliers

We rely on thousands of suppliers to provide the materials, parts and services we need to make our products. Ford is committed to reducing the environmental footprint of our supply chain, as well as our vehicles and our operations.

A Complex Supply Chain

Building and maintaining strong, mutually beneficial relationships with a diverse range of suppliers helps us lower costs, improve quality and make progress toward our sustainability goals.

The automotive supply chain is one of the most complex of any industry. There can be up to 10 tiers of suppliers and sub-suppliers between an automaker such as Ford and the original source of raw materials used in the manufacturing process.

  Read more about the diversity of our supplier base

Our Supply Chain at a Glance

Engaging With Key Suppliers

One of the ways we maintain dialogue with our key strategic suppliers is through our Aligned Business Framework (ABF). This engagement helps improve quality, promote innovation, explore operational synergies and encourage common approaches to addressing areas such as ethical business practices, working conditions, manufacturing impacts and responsible sourcing.

For these suppliers, we have established a three-step process for managing sustainability issues:

• Ford verifies that ABF suppliers have a code of conduct aligned with Policy Letter 24 (pdf, 156kb)
• ABF suppliers conduct internal training to ensure their employees understand and comply with their codes of conduct. Ford validates each supplier’s processes to ensure ongoing alignment
• ABF suppliers are also required to extend our shared expectations to their own suppliers. Ford ensures that ABF suppliers can verify that their own supply chains are compliant with our standards and expectations

 Download a list of our ABF production and indirect suppliers (pdf, 77kb)

Understanding Our Suppliers’ 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. In 2016, we surveyed 242 production suppliers, as well as indirect suppliers of logistics and information technology services.

The selection of 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 their operations, including those in water-stressed regions
• The strategic nature of their relationship with Ford

In 2016, 196 suppliers were also invited to respond to the CDP Water questionnaire, and 140 (71 percent) responded.

Together, these two questionnaires provide qualitative and quantitative information about our suppliers’ management of climate risks, GHG emissions and water use.

We attribute our high response rate of 84 percent (average for all participating companies: 70 percent) to our ongoing support for suppliers through webinars, guidance documents and technical assistance. This includes one-day supplier training programs for calculating, allocating and reporting GHG emissions and a one-day program for water management and water use reductions, developed through the Automotive Industry Action Group (AIAG).

  Visit the data section for more detail on supplier training

The number of Ford suppliers integrating climate change into their business strategies and those reporting water-related targets continues to increase. In 2016:

• 82 percent integrated climate change into their business strategy (2015: 78 percent)
• 64 percent reported a water-related target or goal (2015: 41 percent)
• 64 percent reported having an emissions reduction target (2015: 66 percent)

The data obtained through these surveys has helped us to identify “hotspots” for GHG emissions and water use. These suppliers have been targeted to participate in our Partnership for A Cleaner Environment (PACE) program (see below).

  Find out more about our impacts across our value chain

Building Supplier Capability Through PACE

PACE is a supply chain sustainability initiative designed to reduce the collective environmental footprint of Ford and our supply chain.

Our goal is to share the leading practices we’ve implemented in our own manufacturing plants for reducing energy and water use, GHG and air emissions, and waste generation; this enables suppliers to replicate best practice, minimize their environmental impacts and report their sustainability performance. To extend the impact along the supply chain, we also encourage our Tier 1 suppliers to cascade the information down to their own suppliers.

The Five-Step PACE Process

1. 

   Suppliers create multi-year roadmaps for improving environmental performance.

2. 

   Baseline environmental data is recorded.

3. 

   Successful approaches are selected and replicated.

4. 

   Reductions in GHG and other emissions to air, energy consumption, water use and waste generation are measured, and progress against the baseline is reported.

5. 

   Best practice examples, implemented by our suppliers or our own facilities, are updated and periodically shared.