Building a responsible supply chain is vital to sustaining a resilient and successful business and being a responsible corporate citizen. Infineum has strong supply chains in place, based on long-term partnerships that are supported by a robust integrated management system to assure that business relationships with third parties from supply of raw materials or goods to transportation and other indirect services are aligned with all applicable laws, highest business ethics standards and health, safety and environmental protection, and ultimately with Infineum brand attributes. Our suppliers are a central part of our sustainability strategy and we set the corporate goal to accelerate environmental and social improvements across value chains through sustainability collaborations. Our target is to have more than 80% of relevant spend covered by sustainability assessments by 2025.
Action on responsible supply chain includes:
- Implementing sustainability practices in the Supply Chain and Procurement areas of the organisation. During 2020 we created our Supplier Code of Conduct, signed onto EcoVadis, trained all Procurement colleagues on sustainability issues and opportunities relevant to their roles and responsibilities and started our first sustainability engagements with key suppliers.
- Working with suppliers to understand end-to-end carbon emissions for products and production processes to feed data into our Life Cycle Assessments. This will act as a basis to drive further collaborations for more sustainable products, energy suppliers and optimised value chain and even new business models.
- Evaluating suppliers by using the independent EcoVadis rating on a broad spread of topics, including environmental management systems, human rights, and sustainable procurement practices. Assessments help us understand risks and opportunities in our supply chain and support supplier action, and ensure our supplier base supports our business and sustainability strategy.
- Various initiatives and activities to ensure that our supply chain is free of modern slavery and other human rights abuses (please see the Human Rights section below for more detail).
Saving CO2 emissions through local sourcing
As part of value creation initiatives that were progressed in 2020 with a key global customer, we moved the sourcing of two critical products from our Manufacturing Plant in Italy to our Manufacturing Plants in Singapore and China to be closer to the customer blending plant in Hong Kong. Working closely with the customer, product relocations and supply chain changes were made that significantly reduced transport distances, delivered working capital and freight savings and contributed to a reduction in CO2 emissions of 740Mt per year.
Localisations were also made within our own Manufacturing Plants and with suppliers. For example, we switched sourcing of certain components that we used in our China blending facilities from locations in the US and Italy to alternate sourcing models with local suppliers, enabling us to reduce mileages, lead time and carbon emissions.
Transportation Management System
TMS (Transportation Management System) is a digital platform designed to streamline the shipping processes, providing visibility into day-to-day transportation operations, compliance and documentation, and ensuring timely delivery of freight and goods. TMS is a transformational project within our Global Supply Chain operations and will help Infineum monitor and improve our logistics related carbon footprint, as well as consider carbon emissions in the decision-making processes within our operations.
Supply Chain Optimisations
Since 2019, we have increased focus on switching to more sustainable forms of transportation, payload optimisations and different supply models to reduce carbon emissions.
A few examples include:
- Moving from trucks to rail transport in US, with one example eliminating more than 600 truck shipments for a single route.
- Wider use of intermodal transportation in EMEA versus land transportation and further optimisations by grouping materials or switching to full truck load shipments for higher payloads.
- Moving to local production for components originally shipped from US to Europe.
- Eliminating some intermediate storages by direct shipments from suppliers to our plants in Italy and Singapore.