Even though 62% of auto organisations have a comprehensive sustainability initiative, the report by Capgemini found that focus on the entire supply chain isn’t consistent enough.
52% of auto companies were found to be deploying an initiative that involved ‘supporting and promoting a circular economy’, while just 8% cited ‘sustainability in IT’ as a priority.
Also, only 19% of respondents had four or more quantifiable targets associated with areas with maximum impact on sustainability.
In regards to governance, just 45% declared giving dedicated targets to key executives, while 44% had a dedicated sustainability body within the company.
How can organisations meet their customers’ sustainability demands?
Overall, original equipment manufacturers (OEMs), according to the study, outperformed suppliers in sustainability initiatives, with only three out of 14 being carried out better by suppliers.
“The automotive industry has made steady progress on sustainability, but a more rapid acceleration towards a systemic approach is now needed,” said Markus Winkler, global head of the automotive sector at Capgemini. “To catch up and become a more environment-friendly industry, auto companies need to have a clearer focus on two key priorities: the need for them to more closely link their sustainability and electric vehicle strategies, and to increase investment in circular economy initiatives.
“It’s also critical for companies to make senior executives accountable for results in this area, make use of intelligent technology solutions across the whole value chain, and take a collaborative, partnership-based approach to developing more sustainability processes and standards as an industry.”
The report from Capgemini suggested the following recommendations for auto organisations to improve sustainability initiatives:
- “Demonstrate tangible progress on sustainability by reporting to a standardised set of metrics.
- “Pursue sustainability as an organisation-wide mission.
- “Make business executives accountable for sustainability and invest in robust governance.
- “Envision and spread sustainability initiatives across the automotive value chain.
- “Use technology to improve sustainability of operations.
- “Strengthen alliances and partnerships for greater impact.”
Dispatches at Davos 2020: technology’s opportunity in a cohesive and sustainable world
503 automotive companies and 317 experts were surveyed for this report, and 11 sustainability-focused executives were interviewed.