Suppliers on test
MAN expects its suppliers to improve their sustainability. Copper is a raw material that has a special part to play when it comes to sustainable supply chains.
Our aim is to win our suppliers over to the topic and to encourage them to optimise their own supply chains too. “
MAN takes responsibility for copper and natural rubber within the Volkswagen Group
The focus is on 16 critical raw materials identified by the Volkswagen Group and regarding which activities have been published in its Responsible Raw Materials Report. MAN is responsible for copper and natural rubber, because VW has delegated central responsibility for these critical raw materials to individual subsidiaries. “We take care of risk management, communication and reporting for these two raw materials across the Group and would like to utilise as many synergies as possible within the Volkswagen Group in the process,” says Langlechner.
Copper is already something that can’t be ignored in the commercial vehicle industry. It has become all the more significant in the course of electrification. More than 800 suppliers provide MAN with components that contain copper. Demand is set to rise steeply as part of the transition to e-mobility: an electric truck from MAN contains at least twice as much copper as the previous diesel model. This is primarily due to the electric motors, as well as cabling.
In numbers:
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16 CRITICAL RAW MATERIALS
are under the microscope within the Volkswagen Group.
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800 SUPPLIERS
provide MAN with components that contain copper.
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97 PERCENT
of MAN’s direct suppliers are based in Europe or Turkey. Because regulations are strict within the EU, it is rare for serious violations to occur.
S-Rating is a key criterion for awarding contracts
There are also other ways in which MAN imposes obligations on its suppliers. One of the most important evaluation tools is the S-Rating, which was introduced at the end of 2020 and is also used by other marques within the VW Group. This is a sustainability rating, covering all three ESG criteria: Environment, Social and responsible corporate Governance. Under the latter category, for example, the scheme checks whether suppliers consistently prevent corruption. On the basis of a questionnaire, suppliers must provide evidence that they have implemented all the sustainability requirements imposed by MAN in their own companies. And they must pass these obligations to their own suppliers in turn.
The S-Rating is an essential criterion for MAN when it comes to awarding purchase contracts. If there is any suspicion that a supplier has provided false information or has failed to fulfil MAN’s requirements, MAN will undertake pre-announced sustainability audits. These will check whether the information provided corresponds to the truth. Should any inconsistencies be revealed, the supplier may slide down the rankings and, in the worst case, may lose MAN as a customer. Even legal action is a possibility.
Online complaints portal created
97 per cent of MAN’s direct suppliers are based in Europe or Turkey. Because regulations are strict, at least within the EU, it is rare for serious violations such as environmental pollution to occur. Nevertheless, MAN is vigilant on this and checks, for example, whether occupational health and safety regulations are upheld in the suppliers’ production facilities. Employees of a supplier and their business partners can also submit complaints about issues such as their working conditions via an online portal.
To enable early identification of risks throughout the supply chain, MAN uses artificial intelligence. A business partner scans for negative media reports and social media posts concerning the relevant supplier on behalf of the VW Group and its marques. This allows MAN to identify relevant risks at an early stage and actively manage them.
The subject of sustainability in procurement has developed an incredible dynamic at man over the last few years. “
Text: Elias Holdenried
Photos: MAN / Getty Images
