What do GM’s carbon neutrality plans mean for supply chain?
General Motors signalled its intent on Thursday to become carbon neutral by 2040. Under a new pledge, the car manufacturing giant aims to reduce the environmental impact of its global products and operations, joining a coalition of industry leaders and UN agencies working towards the same goal by signing the Business Ambition Pledge for 1.5⁰C.
The biggest reduction in its carbon outlay will come with an overhaul of its product offering. GM says that the vast majority (around 75%) of the carbon emissions associated with its goals are caused by the use of its fossil fuel-powered cars, trucks and other vehicles.
Working with the Environmental Defense Fund, the manufacturer will work to “develop a shared vision of an all-electric future”. Following wider trends in the automotive industry, GM is accelerating its rollout of electric vehicles (EVs), which will account for around 40% of the models it offers in the US by the end of 2025. Thirty new electric models will be launched during that timeframe, and GM has upped its investment in electric and self-driving vehicles from $20bn to $27bn over the next five years. The company aims to eliminate exhaust emissions from light-duty vehicles ahead of the 2040 deadline, by 2035.
Key supply chain reforms
- GM has formed a ‘sustainability council’ with key suppliers
- The committee will work to develop and enact new standards and best practice
- Increased transparency reduced emissions throughout the supply chain
- Procurement will priorities and source more sustainable materials
“Implementing plans today”
Reaching the carbon neutral target by 2040 will require an overhaul of its internal operations, GM admits. Readdressing supply chain will be central to to its mission. The company is “implementing plans today” to lower the carbon impact of its supply chain, beginning with its biggest suppliers, with which it has established a committee. The ‘sustainability council’ will work hand in hand to “share best practices, learn from each other and create new standards for the industry” - the ramifications of which will impact its entire value chain.
Beyond the committee of core suppliers, GM will also collaborate more broadly down its entire value chain to improve the efficacy of its ESG commitments. Sweeping reforms will aim to increase transparency and push down emissions. In procurement, the car manufacturer says it will prioritise sourcing more sustainable materials.
"General Motors is joining governments and companies around the globe working to establish a safer, greener and better world," said Mary Barra, GM Chairman and CEO, in a statement. "We encourage others to follow suit and make a significant impact on our industry and on the economy as a whole."
Image: Chevrolet Bolt EUV, General Motors
Gartner: Women in supply chain at five-year high
Women now represent a greater percentage of the supply chain workforce than at any other point in at least the past five years, according to a recent Gartner survey.
The Women in Supply Chain Survey 2021, conducted by Gartner and Awesome, surveyed 223 supply chain organisations with more than $100m in annual revenue from February through to the end of March 2021.
- Women represent 2% more of supply chain workforce than in 2020
- Women now account for 42% of the workforce
- Number of women in exec-level positions declined by 2%
- Just 15% of top leadership are women (17% in 2020)
- 84% of organisations say COVID-19 did not impact efforts to advance women
It found that women now represent two per cent more of the supply chain workforce than in 2020, accounting for 42%, compared with 39% last year. Dana Stiffler, Vice President Analyst with the Gartner Supply Chain practice, says the impact of COVID-19 on supply chain was significant, though different to other sectors.
"Contrary to other industries, supply chain’s mission-criticality during the COVID-19 pandemic has meant that many sectors did not reduce their workforce, but rather continued to hire and even faced talent shortages, especially in the product supply chains," she said. "This resulted in many women not only standing their ground in supply chain organisations but increasing their representation in organisations. We also recorded a record number of specific commitments and supply chain-led actions and saw existing programs starting to pay off."
Supply chain still lacks women in executive leadership
But the elephant in the boardroom remains. Though the figures present a positive step towards greater diversity and gender equality at all levels, the number of women in executive level positions declined by two per cent in the past year. Women represent just 15% of the upper echelons of supply chain leadership. Gartner did however record a rise in women at all other levels of leadership.
The vast majority (84%) of organisations surveyed said the outbreak had no discernible impact on their ability to retain and advance women. But more than half (54%) admitted that retaining mid-career women was becoming increasingly difficult. A lack of career opportunities was cited as the biggest challenge to this, while other blamed a lack of development opportunities.
Despite these challenges, companies of all sizes are becoming broadly better at gender diversity. Around a third more said they had a targeted initiative focused on attracting women and advancing their careers.
Stiffler said a push towards measurable and formal initiatives is at least pointing in the right direction: “It's encouraging to see that the larger share of this jump was for more formal targets and specific goals on management scorecards. For these respondents, there is greater accountability for results — and we see the correlation with stronger representation and inclusion showing up in pipelines.”