Trustworthy supply chains

When profitability and CSR work in tandem

As a globally operating company, Rheinmetall Automotive proactively fulfills its responsibility for regular and sustainable raw materials extraction and production processes. This ranges from certificates for conflict-free minerals and environmental approvals to short distances within the supply chain that are both economically and ecologically viable – as shown by the example of the Electrical Vapor Pump (EVAP).

It’s actually quite simple: where economy and ecology work in tandem, a classic win-win situation arises. Until that happens, however, those who are responsible must take many aspects into account and be alert to potential improvements – this applies in particular to such a complex structure as the supply and production chain of an international technology company. An example of the successful reconciliation of ecology, corporate social responsibility (CSR) and economy in the manufacturing of a product is the EVAP. Marcus Gerlach, Chief Purchasing Officer NPM of the Rheinmetall Group, comments: “EVAP was developed in Europe and is now being produced in the USA and China, each with its own supply chain. This is economically efficient, reduces risks of all kinds and generates a lower CO2 footprint than long-haul shipments would”.

Conflict-free minerals

An essential factor of rule-compliant production concerns the handling of possible conflict minerals. These are mined especially in Central African conflict zones and the proceeds from their sale used to fund terrorist activities. To prevent precisely this from happening, the US Dodd–Frank Act of 2010 imposes documentation and publication obligations on all companies listed in the USA – and also on their German suppliers – when using tantalum, tin, gold and tungsten from the Democratic Republic of Congo or its neighboring states. “In practice, this means that companies must present mineral reporting together with their annual financial statements that tracks back to the smelting plant,” says Marcus Gerlach. “This reporting is available for all Rheinmetall Automotive products and is stored in the International Material Data System (IMDS), the globally standardized system for materials data in the automotive industry. 

Certified origin

In principle, every product sampled for customers has an IMDS entry for its material compounds. The binding information for all substances comes from the suppliers and any subcontractors. Any conflict minerals are then identified from this information. Smelting plants are required to record and disclose the source and use of any processed materials. The organization Responsible Minerals Initiative (RMI) inspects the smelting plants and issues the certificate for a Responsible Minerals Assurance Process (RMAP) upon verification. The RMI is not allowed to certify in the event of any violations of the law by the smelting plants. “In contrast to minerals, the problem with plastics obtained from crude oil is clearer. Global companies like BASF have their own codes of conduct that meet the requirements of responsible production,” explains Marcus Gerlach.

CSR in the supply chain

The exampled EVAP consists of almost 20 essential parts. The five most important suppliers are responsible for over 90 -percent of the parts – measured according to their value. Many EVAP components such as housings, impellers and rotors combine plastics and metal. RMI certificates must be available for the metallic elements of the components. The suppliers have demonstrated their high level of responsibility for ensuring good production conditions in the supply chain with a special questionnaire (Self-Assessment Questionnaire) on CSR and sustainability. Without exception, the five biggest suppliers for EVAP achieved more than 80 percent of the possible score.

Code of Conduct is binding

The Rheinmetall Group has a Code of Conduct and a Supplier Code of Conduct. The latter is a binding part of all contracts with suppliers. The Supplier Code of Conduct includes requirements in the areas of compliance, human rights and working conditions, in particular the prohibition of forced and child labor

In addition, all suppliers must provide evidence of a functioning environmental management system in accordance with ISO 14001. “We are familiar with all our suppliers and their production facilities from regular visits to their sites,” says Marcus Gerlach. “During these visits, the company’s 180 purchasers worldwide pay particular attention to the quality of the components, but are also vigilant with regard to aspects such as occupational safety, cleanliness and the illegal employment of children. 

System works

In recent years, Rheinmetall Automotive has had only positive experiences with its approach to environmental protection and CSR, and has not experienced any violations of the rules. Especially in China, the environmental audit has become of fundamental importance. “China wants to be clean when it comes to compliance and the environment, and the government is imposing tough controls,” says Marcus Gerlach. And in case there is any doubt, the inspectors can shut down plants immediately. Thus, if ecological rules are violated, there is a real economic risk that no one can afford to take. “Thanks to its global rules, the automotive industry has reached a level that is exemplary and indicates to other industries the path to take,” sums up Marcus Gerlach.

EVAP – Better retention of fuel vapour

Strict legal limits are now in place not only for emissions from the combustion engines of vehicles, but also for the emission of their fuel vapors. The vapors are collected in an activated carbon container that must be flushed regularly. Pierburg GmbH has developed an innovative, compact pump for this application – the Electrical Vapor Pump (EVAP). It flushes the carbon container even without the previously necessary vacuum in the intake pipe. The activated carbon is used to collect fuel vapors and bind them until they are burned in the engine. Because the tank’s capacity for storing hydrocarbon compounds is limited, fresh air must be injected regularly. Today’s engine generations that do not have an adequate vacuum supply, require a solution that actively contributes to cleaning the tank. The EVAP is a centrifugal electric model of a gas pump that performs this function. It is driven by a single-phase motor that matches the high throughput and low pressure of the operation. A high torque ensures that the pump starts and reacts quickly, while the centrifugal design allows it to work even against the closed valve with little energy input. Weight and cost are low thanks to the use of several plastic components. The electric pump was the first of its kind and went into series production for a customer in 2018.