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May 19, 2021

Supplier choice: Sustainability as important as cost and quality

We’re calling on our suppliers to help us achieve our climate neutral by 2040 ambition – now sustainability is as important as cost and quality.

"We always focus on cost and quality. Now, we are bringing sustainability into the negotiations as well," says Kerstin Enochsson, our new head of Procurement. "It will not be enough for a supplier to be really good within one of these three fields. To be our partner, they need to fulfil all requirements."


Improvements within the supply chain can account for a quarter of our overall aim to reduce the CO2 footprint per car by 40 per cent between 2018 and 2025.


Javier Varela, our head of Industrial Operations and Quality, says: "Emissions from our supply base are included in our footprint. This is an area where we must make significant progress in order to reach our CO2 emission targets and to become a climate neutral company by 2040."


To gain momentum, we have initiated CO2 negotiations with around 20 strategic suppliers. The negotiations aim to make the suppliers commit to reducing their CO2 emissions so they're in line with our targets. Plus we've called on our suppliers to reach out with ideas and propose joint sustainability initiatives.


Kerstin Enochsson explains: "In addition to having integrated our sustainability targets into the sourcing process and decision making, we also support suppliers with relevant training to help them increase their sustainability competence."


We delivered these messages to around 2,000 participants from suppliers around the world at our 2021 Sustainability Dialogue 'The future of the Supply Chain' – a virtual session that featured Håkan Samuelsson, Javier Varela, Kerstin Enochsson and other key members of the Procurement team.


"The feedback from suppliers has been really positive," Kerstin says. "We feel that there is a strong drive for innovation and collaboration."