Roughly 90 percent of our supply chain partners support our packaging businesses. The remaining suppliers and subcontractors serve our aerospace business. Our top 100 suppliers represent the vast majority of dollars we spend on our goods and services. We focus the majority of our efforts with those suppliers in three key categories: aluminum, steel and metal coatings. Building on our rich history of more than 130 years, we have developed stable and proven relationships with our suppliers throughout all regions of the globe. Wherever Ball operates, we strive to focus on strategic rather than tactical sourcing.
By embedding a sustainability mindset into our supply chain, we can have a larger impact than if we improved only our own operational footprint. However, our supply chains are global and diverse, with many customers and suppliers who are significantly larger than Ball. We need to face the challenge to confirm that responsible business practices are maintained throughout our supply chain.
In 2011, Ball sourced approximately 90 percent of its sourcing volume from countries within the OECD (Organisation for Economic Co-operation and Development), an international organization promoting policies that improve the economic and social well-being of people around the world. Global supply chains continue to grow and expand. That is why we assume that we will purchase more goods from countries outside of the OECD in the future. While we will strive to require suppliers from these countries to comply with our standards, this might pose additional challenges to ensure their compliance.
Ball’s total spend with minority and women-owned businesses was $45 million in 2011 in North America, or approximately 1.5 percent of our total spend in North America. Because of the nature of our business and the fact that aluminum, steel and metal coatings are our greatest material costs, we believe that reaching $45 million is a significant achievement. Nevertheless, we are working toward further increasing our minority and women-owned businesses spend in the future.
Senior Sustainability Analyst,
As part of your overall sustainability assessment, you evaluate to what extent companies manage sustainability in their supply chains. Why is investors' interest in supply chain risks and opportunities continuously growing and what is the challenge for Ball in particular?
Sustainability can create value and drive innovation when companies use strategy, rather than legal compliance, as a starting point. Calvert commends Ball Corporation for its strategic approach. We encourage Ball to continue including sustainability metrics in business plans, engaging with stakeholders, and using materiality assessments to prioritize environmental, social and governance factors through the company’s full value chain, both up and downstream.
This includes supply chain management – an area where Ball has room to improve. In the 2012 Sustainability Report, we would like to see a more robust supply chain approach, one that examines and discloses key risk factors such as material, water and energy needs, and describes systems to monitor labor, human rights and environmental performance. Supply chain management informs the complex network of suppliers, manufacturers, transporters, distributors, and vendors to support the efficient delivery of high quality products and sustainable solutions.