Raw materials are the basis of Scanias industrial processes and we are committed to build products through responsible business by aiming for a supply chain which cause no unnecessary harm for the people and the environment. However, mapping our products from mill to final assembly is a major challenge due to the complexity and constant changes.
Scania believes transparency and cooperation are key word for positive changes throughout our supply chain and we expect our suppliers to take responsibility together with us. We expect our suppliers to disclose the source of materials that may be associated with environmental impacts and potential human rights violations.
Risk based approach
In the Drive Sustainability automotive sustainability supply chain partnership, we use a common process, the Raw material observatory, to understand and assessing impacts, risks, and opportunities for positive action within the material supply chain of the automotive industry. Together with the Responsible Minerals Initiative (RMI) and The Dragonfly Initiative, Drive Sustainability have developed a study on the topic of sustainability risks in the commodities sector entitled “Material Change Report”. The report focus on critical raw materials based various factors such as social and environmental risks, usage and industry consumption. Within Drive Sustainability, the members decides together which actions to take commonly.
In addition, Scania have an individual risk based raw material strategy accustomed to the material composition in our products as well as stakeholder expectations. We focus on both social, ethical and environmental hot spots in our upstream supply chain but we also realise that the climate change challenges that we are now facing will affect all areas within a sustainable supply chain.
Scania has a responsibility to improve our environmental impact from purchased goods and services. From an environmental perspective, Steel is an example of a metal in focus. Steel is by weight the material in our products that is most widely used and is therefore responsible for the highest CO2 emissions from a cradle-to-gate perspective. In this stage, we join initiatives with an aim to learn about the challenges the steel industry is facing and to communicate our consumer need for metals with a low environmental impact.
During 2018, Scania updated its Supplier Code of Conduct with provisions for a sustainable minerals supply chain. Additionally, Reasonable Country of Origin Inquiry was carried out to identify smelters and refiners associated with our supply chain for metals tantalum, tin, tungsten as well as gold (3TG). This led to the issue of a Conflict Minerals Reporting Template, which addresses 3TG material origin for the products sold by Scania during 2018. The exercise indicated that roughly 86% of smelters in our raw material supply chain sourced 3TG from smelters conformant with the Responsible Minerals Assurance Process (RMAP) assessment protocols. During this year we will be working towards strengthening our management systems to better respond to identified risks, congruent with the OECD five step framework for risk-based due diligence in the mineral supply chain. This includes remedial action to ensure a conflict-free raw material supply chain in the future, and better mitigate risks for our component supply chain where the exercise proved more challenging.
Through Volkswagen, Scania is member of the Responsible Minerals Initiative (previously Conflict-Free Sourcing Initiative), a global benchmark for due diligence on conflict minerals. In doing so, we aim to take an active role to promote responsible sourcing of minerals