Supply Chain Carbon Management Strategy for Ford Motor Company
The processing of raw materials and the manufacturing of components for the automotive supply chain results in significant lifecycle energy consumption and greenhouse gas emissions. As a result, automobile manufacturers face potential financial risks from their supply chain operations in the form of energy price volatility and regulatory actions to curb climate change. To understand and address this challenge, Ford Motor Company and the University of Michigan School of Natural Resources and Environment student team developed a strategy for managing greenhouse gas emissions in the vehicle supply chain. Since December 2008, the team has supported the engagement of suppliers through the development and administration of a survey to collect allocated greenhouse gas data and environmental management practices information. The student team also advanced industry-wide participation through collaboration with the Automotive Industry Action Group to standardize greenhouse gas reporting requests provided to suppliers. Additionally, the student team evaluated public reporting options, specifically by engaging Ford as tester of the new Scope 3 Greenhouse Gas Carbon Accounting Standard drafted by the World Resource Institute and the World Business Council for Sustainable Development. The different components of the master’s project have informed short- and long-term recommendations for the measurement, management, and reporting of supply chain carbon emissions by Ford.