Considering the value chain
In 2010, Audi became the first company to employ the carbon-neutral rail transport service Eco Plus from the provider DB Schenker – so-called “green trains”. For the service, which is offered for transports within Germany, Deutsche Bahn additionally purchases electricity from renewable sources. The required amount of electricity is determined in advance by the logistics provider, depending on the route and the goods to be transported. TÜV has audited the carbon-neutrality of Eco Plus and confirms that 100 percent of the “green” energy supplied is used to transport cars for Audi. Since 2010, the green trains have been travelling between Ingolstadt and the loading port in Emden. As a result, the company reduced CO2 emissions by a total of 8,305 metric tons in 2015 alone. Since 2012, the green trains have also been travelling the route between Neckarsulm and Emden. Hier konnte Audi im Jahr 2015 CO2Saving 4,197 metric tons in emissions.
In 2015, a powerful 1,000 bhp hybrid locomotive replaced the previous works locomotive at the Ingolstadt plant. Components and finished Audi models are now transferred to the unloading stations at the plant with less environmental impact – the modern plug-in hybrid locomotive can reduce CO2 emissions by as much as 60 metric tons per year. “Our goal is comprehensively sustainable logistics,” remarked Johann Schmid, Head of the Audi Plant Railway Ingolstadt. “The new rail technology makes rail transport more economical and energy-efficient, while cutting emissions. Combined with cutting-edge chassis engineering, the plug-in hybrid locomotive redefines the benchmark for shunting operations and rail freight transport.”
In addition to demanding a high level of performance and competitiveness from its suppliers, the Audi Group expects them to strictly adhere to sustainability standards. These apply to the suppliers for the entire Volkswagen Group, since all Group brands rely on a shared pool of suppliers in order to be able to make use of potential synergies. All suppliers have committed themselves to compliance with the “Volkswagen Group requirements regarding sustainability in its relationships with business partners.” The concept of sustainability in supplier relationships is aligned with principles laid down in the UN Global Compact, the OECD Guidelines for Multinational Enterprises and the relevant conventions of the International Labour Organization (ILO).
Requirements placed on suppliers include the use of an environmental management system, avoiding harm to the environment and to health during the production process, and the prohibition of child and forced labour. In addition, Audi requires that working hours and compensation fulfil national legal requirements and minimum standards.
In 2016, a new passage was added concerning the use of conflict materials. According to this, suppliers undertake to refrain from procuring any materials which directly or indirectly support non-state armed groups through their extraction, transport, trade, handling or export. At the request of the Volkswagen Group, all information regarding the origin of minerals procured by suppliers or sub-suppliers must be disclosed.
To lend the sustainability requirements even more weight, they have also been an integral part of the contract with suppliers since 2014 and supplemented by elements of a code of conduct for business partners. In addition to the previously valid environmental and social standards, they now also include an auditing right, a right to extraordinary termination in the event of violation and greater importance is attached to anti-corruption measures, money laundering, import and export controls and statements regarding free competition.
Together with other companies in the sector and the environmental organisation IUCN (International Union for Conservation of Nature), Audi is also active in the Aluminium Stewardship Initiative (ASI). The objective of this initiative was to develop a global standard for sustainable aluminium by the end of 2014. Environmental and social criteria valid for all stages of raw material extraction, production and processing were to be defined here. The coordination process was completed on schedule by all parties involved and the standard defined in September 2014.
The specific VW Group requirements regarding sustainability in its relationships with suppliers can be found at www.vwgroupsupply.com and are available for download in the right-hand column.
As we see it, the focal point of all measures is positive development of business relationships and dialogue with our suppliers. If we feel that improvements are needed in regard to environmental protection or social standards, we offer our support – if necessary we even involve our Works Council members, company doctors and environmental experts. In addition, a mandatory e-learning training module on the topic of sustainability has been available in nine languages on the central business platform of the Volkswagen Group since early 2012. If a supplier is not able or willing to meet our sustainability requirements despite our support, we will consider terminating our cooperation.
In future too, we will continuously and systematically develop our sustainability concept in our supplier relationships. At present we are developing a concept for more effective monitoring of compliance with standards by our suppliers, who are spread out across the entire globe.