Supply Chain Management
Working with our suppliers to create shared value.
Highlights
- Greif recognizes that as a global manufacturer, our impacts extend beyond our operations, and we are responsible for engaging suppliers to ensure they are committed to the same sustainability standards and values we demonstrate.
- In 2022, Greif assessed 39 percent of our supplier spending using EcoVadis assessments, exceeding our goal to assess 35 percent of our suppliers by the end of 2022.
- Suppliers are given access to our Supplier Code of Conduct via Greif.com and must adhere to the principles within. Globally, our Supplier Code of Conduct is part of our suppliers’ purchase orders and agreements.
Why Supply Chain Management Matters
As a global manufacturer, Greif recognizes that our impacts extend beyond our operations and that we have a responsibility to engage suppliers as part of our commitment to sustainability. We expect our suppliers to uphold the same levels of integrity, accountability and commitment to sustainability. Working closely with suppliers can minimize actual and potential environmental or social impacts. This allows us to further a shared mission and find opportunities that better serve our customers.
Governance
Greif’s Global Supply Chain Team leads the execution of our supply chain sustainability objectives by assessing supplier sustainability performance, evaluating opportunities to limit material use and identifying raw material alternatives. In 2022, we introduced a new leadership position, the Chief Supply Chain Officer, reporting directly to the Chief Executive Officer. Our Chief Supply Chain Officer leads our supply chain operational excellence in the areas of purchasing, materials planning, supplier performance and setting our strategy to accomplish our strategic sourcing business and sustainability objectives. Additionally, Greif’s Global Supply Chain Team (GSC) tracks monthly improvements in material costs, working capital, deal terms and inventory as part of the Greif Business System 2.0 (GBS 2.0).
EPA’s SmartWay Transport Partnership
To manage logistics in an environmentally responsible manner, Greif uses carriers that are approved through the EPA’s SmartWay initiative whenever possible. We include SmartWay certification during our new carrier certification process. Greif’s SmartWay- approved carrier base accounts for 77 percent of total miles traveled.
Suppliers are given access to the Supplier Code of Conduct through our purchase orders, contractual agreements, or direct links to our website Greif.com. By the end of 2023, Greif is targeting that all global purchase orders will reference the Supplier Code of Conduct. We regularly update our Supplier Code of Conduct to expand its scope and strengthen its language. The most recent update better outlines our expectations and addresses environmental and social risks within our supply chain based on the key industries we serve. We issued an updated Supplier Code of Conduct as a formal policy and began more vigorous enforcement among our suppliers. Following this update, we will soon require that all suppliers agree to the new Supplier Code of Conduct before completing a purchase order.
In the United States and Canada, our Temporary Labor Policy formalizes additional requirements for temporary labor agency providers and maintains compliance with all regulatory requirements. Next year, we will reevaluate how this policy is implemented.
To ensure continuous supplier improvement in colleague health and safety, we integrated language on conformance to standards and ISO certification development into our supplier audits. We benchmarked industry best practices to improve our supplier scorecards, Supplier Code of Conduct, and rating procedures. We created relevant training for all colleagues available through Greif University. Our Code of Conduct training embeds Greif’s values into our colleagues, preparing them to escalate non-compliance issues. We are utilizing EcoVadis assessments to analyze the sustainability performance of our suppliers. Since 2022, we have requested that priority suppliers complete EcoVadis assessments. Last year, we set a target to assess 35 percent of our suppliers by the end of 2022. We exceeded this goal with an EcoVadis response from 39 percent of our supplier spend. We annually train our buyers on EcoVadis, helping them to understand which factors guide the EcoVadis assessment. We also share EcoVadis training opportunities with our partner suppliers when relevant to help improve their sustainability initiatives.
Compliance with applicable laws to manage potential human rights violations in our supply chain is an essential part of our management system. Since some Greif products contain tin, we are committed to understanding the 3TG metals in our supply chain. To assess conflict risk throughout our supply chain, we validate our Conflict Minerals Policy and publish our Conflict Minerals Report annually. In accordance with the California Transparency in Supply Chains Act of 2010, Greif takes measures to prevent and eliminate forced labor in our direct supply chain, as outlined in our Supplier Code of Conduct and Transparency in Supply Chain Disclosure. Our ethics hotline is also available for anyone to report any conflict mineral-related concern. We continuously monitor regulations to ensure compliance and alignment with best practices. Due to unprecedented events resulting from the Ukraine-Russia conflict, a new addition to our compliance in 2022 has been to align with Russian-related sanctions. We will continue to work with suppliers to ensure we comply with these sanctions and similar future supply chain occurrences.
We have experienced significant progress in our Supply Chain initiatives in recent years. For example, in 2018, we began replacing combustible gasoline and LPG-powered forklifts with electricity-powered forklifts to support Greif’s Renewable Forklift Policy which resulted in significant emissions savings. Through 2022, we converted 79 percent of our forklifts in the Europe, Middle East and Africa (EMEA) region to electricity-powered. Additionally, in 2021, we made changes to impact energy and emissions use among our trucks and colleague vehicle fleet. We transitioned 99 percent of our North American fleet to solar-powered GPS units. We also promoted vehicle energy efficiency and electric vehicles through stringent emission guidelines in our EMEA business unit and developed a policy for EMEA with a goal to transition 70 percent of vehicles with electric and hybrid alternatives by 2030.
Transitioning to Electric Forklifts
As part of our overarching goal of having more efficient and sustainable equipment, in 2018 we began transitioning our fleet of forklifts from being powered by combustion gasoline to electricity, which reduces our forklift emissions by approximately 50 percent. Through 2022, we have converted the following percentages of forklift fleets to electric:
- EMEA: 79 percent
- North America: 16 percent
- Latin America: 30 percent
Due to the success of the program and in support of our overall Renewable Forklift Policy, the program will be rolled out globally. In addition to the environmental benefits, the transition provides a safer working environment for our colleagues by reducing the need to keep containers of gasoline in our facilities.
Since 2015, we have focused on lowering steel coil material volume and potentially hazardous paint within our operations. We now use safer alternatives in many products, including our Tri-Sure Vreeland linings and water-based acrylic paints. All North American steel facilities, except in Auburndale, Florida, use water-based paints, and water-based paints are used in ten additional North American facilities and 11 facilities throughout Europe. Our Asia Pacific (APAC) facilities are also transitioning to water-based paints, including at our Zhuhai and Shanghai facilities, where 65 percent and 58 percent of their paint usage was water-based in 2022, respectively. Additionally, our Huizhou and Taicang facilities are beginning to transition to more water-based paints. The steps we take to reduce hazardous waste align with our Environmental Health and Safety Policy.
Goals, Progress & Performance
2030 Goal:
- Evaluate the sustainability performance for 80 percent of our total spend with suppliers.
Our sustainable value chain begins with the raw materials we procure and our partnered suppliers. In 2022, we announced a 2030 supply chain target to ensure we work with suppliers committed to tackling global sustainability challenges.
To identify opportunities to advance our goals, our sourcing managers incorporate topics such as carbon content, recyclability and packaging improvement into conversations with many suppliers. We have made green material substitutions to increase post-consumer plastic use in our products. We expanded our efficiency with corrugated cardboard boxes and other packaging materials to increase reusability while optimizing logistical routes to reduce shipping expenditures. In some EMEA facilities, we have introduced a more biodegradable oil to clean our paint lines. The move from non-green products and materials, such as oil-based products, has prompted us to engage in green-material sourcing from our suppliers. We have moved away from solvent-based paints to water-based paints and liners for drums. We supplement this collaborative work with internal changes, such as transitioning to LED lights. These initiatives are all a part of a larger training initiative with the Supply Chain Team to develop new projects and plan to integrate sustainability into the buyer’s performance appraisals, including buyers for steel, resin and logistics.
