This post is part two of an article published earlier in the week about how to use the GRI Automotive Sector Supplement to improve your sustainability reporting.
In the first part, we discussed the seven GRI sustainability metrics that have been modified and updated specifically for automotive manufacturers. If you missed part one of this series or just need a refresher, you can read the article here.
In this article, we’ll be discussing the 10 new sustainability metrics that have been developed by the GRI international automotive work group.
These sustainability indicators address the specific needs of automotive manufacturers that most other sectors typically do not need to worry about when it comes to sustainability tracking (e.g. life-cycle analysis, Design-for-Recycling, fuel economy, and supply chain performance monitoring).
The New Performance Indicators
The GRI automotive forum developed 10 new sustainability performance indicators that are unique to the automotive industry.
In general, the data required for reporting is not complicated, and the Automotive Sector Supplement sustainability metrics are brief and concise. Automotive sector indicators all use an A identifier, regardless of whether they report on an environmental, social, or economic aspects.
Social Sustainability Indicators
A1. Specify stipulated work hours per week and average hours worked overtime in production.
A2. Percentage of employees not managed on an hourly basis with overtime compensation schemes.
A3. Percentage of major first-tier supplier facilities with independent trade union organizations or other bona fide employee representatives. State amount of purchases from these suppliers as a percentage of overall purchases.
Product Sustainability Indicators
These sustainability metrics address a wide range of impacts your products could have both on the environment and on those who use them. This includes reportable aspects like fuel efficiency, external environmental impacts, and material content.
A4. Number of vehicles sold, broken down by type, fuels, power train technologies, and by region. You should also include an explanatory definition for categorizing the different vehicle types.
A5. Breakdown by region/country of the compliance of vehicles sold with respective existing and next defined emissions standards.
It’s important to keep track of the varying environmental regulations that affect your different markets. For example, the list of banned substances for Asian countries is very different from North American markets. The GADSL (Global Automotive Declarable Substance List) is a good resource for automotive manufacturers facing this dilemma.
A6. Average fuel economy by type of vehicle broken down by region, as applicable. The vehicle “type” for manufacturers of commercial vehicles refers to vehicle “segment” in this case.
Fuel economy is one of the most scrutinized sustainability metric, as it has a direct impact on air emissions, customer satisfaction, and socially-responsible marketing. There have already been many reported cases of regulating bodies becoming involved in monitoring and penalizing automotive manufacturers that are not accurate in the tracking of the data covered by this metric.
A7. Average carbon dioxide emissions by type of vehicle broken down by region, as applicable.
A8. Breakdown by region/country of compliance of vehicles sold with their respective existing and next defined noise standards.
A9. The GRI automotive workgroup decided that reporters should use GRI indicator EN34 from the 2002 guidelines to account for significant environmental impacts of transportation used for logistical purposes.
A10. Weight of the vehicle and percentage breakdown of generic, recyclable, and renewable material of a best-selling vehicle.
This sustainability metric focuses on your end of life-cycle management and Design-for-Recycling.
While the automotive industry is not typically known for reclaiming parts from older vehicles at the end of their life cycles, it is nonetheless important to develop cars that can be dissembled for recycling rather than being left in landfills.
There are also issues arising out of managing electric vehicle components that are at the end of their life cycle but still reclaimable for other purposes.
The Automotive Sector Supplement highlights some important sustainability tracking practices, even for those manufacturers outside the automotive industry.
One of the key principles identified by the GRI automotive workgroup is that supply chain sustainability is key to measuring your own business’ sustainability. For example, ensuring your product doesn’t contain any banned or toxic substances is most easily accomplished by rooting them out at the source, before they get sold to you.
Another key takeaway is the importance of being proactive in your regulatory research and preparedness. The new GRI sustainability indicators that focus on compliance require you to not only comply with current regional regulations, but also to be in compliance with expected upcoming regulations.
That means you need to know what rules are coming into effect in the next few years, instead of just reacting once they initial compliance deadline is looming.