A few weeks ago, father Christmas was about to go across the world, in his carbon-free reindeer sledge, to deliver his presents to the children of the world. What a lovely thought… 

Now imagine if these presents were made in insalubrious workshops by little minor elves, working for a ridiculous salary, using nonrenewable or dangerous materials and tools. Imagine if Santa Claus’ trail was powered by an old thermal engine, leaving a polluting trail all across the world.  Would you still find it lovely? Would you still want to order your Christmas presents to Santa Claus if he displayed such behaviors? We wouldn’t.  And we wouldn’t be the only ones since more and more shoppers and regulators are demanding transparency around how products are sourced.

This is the same with our batteries’ modules. ACC’s mission is to accelerate the transition to sustainable and affordable mobility for all. But to drive the industrial and environmental transition to cleaner mobility – and to ensure our competitiveness - we have to actively and continuously reduce the social and environmental impacts of battery cells and modules at each stage of their lifecycle. We can’t ignore that there are a lot of social and environmental issues linked to mining and raw materials extraction. We can’t ignore that a lot is at stake regarding the recycling of batteries. We can’t create innovating products using old recipes. We have to act radically different to shape the future of our business.

So what is a sustainable supply chain? What is at stake? And what are we doing on the matter? That’s what we will try to explain in this series of articles. 
 

An awakening to the challenges of the supply chain that is moving the lines

It all started with the photo of a young boy in Pakistan  sewing a Nike ball in 1997. The picture went around the world, making Western consumers aware of the conditions in which their favorite products were manufactured. 

After this child labor scandal, the collapse of the Rana Plaza in 2013 drew attention to the deplorable working conditions at subcontractors in Asia, already denounced by NGOs for several years. On 24 April 2013, an 8-storey building housing 6 textile factories, the Rana Plaza, collapsed in Savar, a suburb of Dhaka, Bangladesh, killing 1,138 and injuring more than 2,000 of the workers employed there, making garments for Western clothing brands or distributors. The collapse of the Rana Plaza has sent shockwaves through the fashion industry. In the first minutes after the collapse, local and international trade union and human rights organisations mobilised themselves to regulate the activities of the multinationals and prevent such tragedies from happening again with impunity. 10 years later, their mobilization has not wavered. Today, consumers, authorities, media, contractors, everyone knows what is happening in the supply chain.
This is how supply chains have been facing a massive transformation these last few years due to increasing demands for sustainability and transparency. In the past, the supply chain focused on availability, tracking and costs. It has now taken on a much broader meaning that includes internal and external stakeholders, but also issues like water, energy, and waste in the supply chain.
 

What is a sustainable supply chain?

A sustainable supply chain – or a responsible sourcing approach - can be defined by the application of responsible environmental, social, and financial practices at every stage of the value chain to protect the people and the environment across the whole chain. 

• Upstream, at the sourcing level, it involves integrating social, ethical, and environmental performance factors into the supplier selection process – It is called responsible sourcing and sustainable procurement.
• Downstream, it involves reducing waste, using the most efficient modes of transport to reduce environmental footprint when it comes freight and logistics, and understanding how the product can be collected, reused, repurposed and recycled. 

Factors such as waste reduction and management, GHG emissions, labour conditions, health and safety or worker exploitation are therefore considered all across the product value chain, and not just at the organization level. The role of the sustainable supply chain manager is to make sure that the organization upholds the best environmental and social standards for their own operations and for their suppliers' operations.

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Focus on the legal framework

There are several laws and regulations that frame sustainable supply chain management, including:

• The Modern Slavery Act (2015) in the UK, which requires companies to disclose the actions they are taking to ensure that there is no forced labor in their supply chains.
• The California Transparency in Supply Chains Act (2010) in the United States, which requires companies to disclose their efforts to eradicate slavery and human trafficking from their supply chains. 
• The  European Union's Corporate Sustainability Reporting Directive (2022), which requires companies to disclose information about their environmental and social impacts, including those in their supply chains.
• The upcoming battery regulation which implements a battery due diligence obligations to identifying, preventing and addressing actual and potential social and environmental risks linked to the sourcing, processing and trading of the raw materials and secondary raw materials required for battery manufacturing including suppliers in the chain and their subsidiaries or subcontractors that perform such activities.
• The United Nations Guiding Principles on Business and Human Rights, which provide a framework for companies to respect human rights in their operations and supply chains.
• The Sustainable Development Goals (SDGs) set by the United Nations in 2015, which include targets related to responsible consumption and production, and the promotion of sustainable supply chains.
• The Environmental Protection Agency's (EPA) Resource Conservation and Recovery Act (RCRA) and the Clean Air Act, Clean Water Act, and the Safe Drinking Water Act, which are laws that place specific regulations on the handling and disposal of hazardous waste material generated in industry and commerce and also promote the conservation and recovery of resources.
• ISO 14001, an international standard for environmental management systems, which helps organizations to minimize their environmental impact and comply with relevant regulations.

These laws and regulations vary in their scope and requirements, but they all aim to promote greater transparency and accountability in supply chain management, and to encourage companies to take steps to ensure that their supply chains are sustainable and socially responsible.

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So what is ACC doing on the matter? How do we ensure that we, and our suppliers, respect these principles? That’s what we’ll try to answer in the next article. Stay tuned !