Taking Action as an Industry

The long-term sustainability of efforts to protect human rights in the automotive supply chain depends on the active participation of all parties – from the original equipment manufacturers (OEMs) such as Ford, to the suppliers themselves, to the government agencies that set and enforce the regulations governing operations. Such collective action will not only minimize costs and increase efficiency for OEMs and suppliers alike, but will lead to better results than if individual companies take steps in isolation.

Automotive Industry Action Group (AIAG) Initiative

Since 2004, Ford has worked with the AIAG to implement its capability-building program with our suppliers, always with an eye toward leveraging that work with other automakers. Ford has approached the industry work – from the beginning – with an "open book" position. Materials developed within Ford to promote responsible working conditions have been offered to the group as a platform for use and development. In 2005, General Motors and then-DaimlerChrysler joined Ford and the AIAG in exploring a cooperative industry approach to promoting decent working conditions in the supply chain.

With support from a $185,000 grant from the U.S. State Department to Business for Social Responsibility, a nonprofit group that works with companies to advance responsible business practices, the AIAG launched a collaborative, industry-wide project in 2006. Ford has contributed an "executive on loan" – the global manager of our supply chain sustainability group – to the AIAG to support the project and facilitate sharing what we have learned based on our experience working on these issues within our own operations. Honda North America and Toyota North America have since joined the effort.

Project participants have established a set of guiding statements to create a shared industry voice on key working conditions issues. The statements cover the core elements of individual companies' codes and policies, joint codes created by other industries and key international standards. These elements include child labor, forced labor, freedom of association, harassment and discrimination, health and safety, wages and benefits, and working hours.

First Workshops

In July 2007, the project launched the first joint workshop, held in Shanghai, China, for suppliers to Ford, GM and Chrysler, followed by eight additional sessions in China throughout the year. All training materials were based on Ford-developed training. With the support of the AIAG and the China Association of Automobile Manufacturers, the mandatory training reached 250 suppliers, including 178 suppliers to Ford's joint ventures in China. In November and December 2007, four training sessions were held in Mexico, with a total of 183 suppliers participating, including 20 suppliers to Ford. Additional sessions will be held in 2008 in China and Mexico.

Next Steps – Industry Cooperation

The cooperative project continues to work on several fronts:

• Actively reaching out to others in the automotive supply chain, including European, Japanese and Korean automakers; industry associations in Europe and Japan; and major automotive suppliers. Broader participation will be needed to achieve the vision of an industry-wide approach to promoting decent working conditions in the supply chain.
• Expanding the training program to other countries and additional audiences, including the executive leadership of supplier organizations.
• Development of additional resources and networks that will ensure the successful communication of working conditions expectations throughout the automotive supply chain.