02 Sustainable Solutions Supply Chain

Supply Chain Progress and Growth

Annette Clayton, Executive Vice President, Global Supply Chain and North America Operations, Schneider Electric

A responsible and efficient supply chain

Schneider Electric works with sectors that account for the majority of global energy consumption and its corresponding CO₂. Therefore, we are especially committed to making sure our own products and solutions help reduce both energy use and CO₂ emissions — from design to manufacturing to shipping and deployment to products’ end-of-life.

The new 2018 – 2020 Schneider Sustainability Impact statement includes the following goals:

5 pts / 100 increase in average score of ISO 26000 assessments for our strategic suppliers
300 suppliers under Human Rights & Environment vigilance received specific on-site assessment
100% of sales, procurement, and finance employees trained every year on anti-corruption

When we share our sustainable development vision with suppliers, we place customers at the center of this message. Schneider Electric’s tailored supply chain is mindful of the diverse practices, standards, and values of the 100+ countries in which we’re present.

Schneider’s supply chain at a glance

207

factories in 44 countries

86,000

employees

€11 billion

purchases

98

distribution centers

24,000

suppliers

150,000

order lines per day

#7

Gartner^™ Top 10 Supply Chain Organizations for 2017

#17

Gartner^™ Supply Chain Top 25 of 2017

2017 supply chain highlights

358

on-site audits that included sustainability criteria

2,400

kilotons of goods shipped

88%

of the strategic suppliers passed the third-party evaluation for sustainable development, 2015 – 2017

10%

reduction of CO₂ emissions from transportation over 2015 – 2017 period

74%

goods shipped by road (23% by ocean, 3% by air)

70%

of relevant purchases confirmed as conflict-free under the Conflict Minerals rule of 2012.

Industry of the future

In February 2018, our Le Vaudreuil plant received the "Showcase for Industry of the Future" award from the Alliance pour l’Industrie du Futur.

Schneider’s Le Vaudreuil Smart Factory started this journey in 2017 as a pilot for the company and its TSC 2.0 program, now upgraded to its 4.0 version. Le Vaudreuil has developed and implemented many changes in several areas leveraging our own EcoStruxure^™ solutions such as:

Cybersecurity and the integration of a data bunker
Energy management with the use of our building management system
Addition of sensors to allow predictive maintenance
Combination of EcoStruxure with startup solutions such as apps so employees benefit from continuous training

2015 – 2017 Planet & Society barometer achievements

See the full results

Climate

10.3%

CO₂ savings from transportation

Circular Economy

130

sites received ‘Towards Zero Waste to Landfill’ recognition

Ethics

87.9%

of our recommended suppliers embrace ISO 26000 guidelines

Tailored Supply Chain 4.0

In this digital economy, Schneider Electric’s global supply chain is evolving to become even more tailored, sustainable, and connected with our Tailored Supply Chain 4.0 strategy, powered by EcoStruxure solutions.

Tailored: We are passionate about our customers’ success, always seeking to provide what they value while leveraging scale and efficiency.

Sustainable: Sustainability is a priority across our supply chain, exemplifying our concern for people and the planet. We optimize resources by developing a circular supply chain with clean and safe facilities powered by renewable energy.

Connected: Our supply chain is digital and smart, powered by EcoStruxure products and solutions. We provide visibility to customers, optimizing end-to-end efficiency and asset reliability.

Tailored, Sustainable, Connected Supply Chain 4.0

11 customer segments with different buying behaviors

Electrical distributors
IT distributors
Consumer retailers
Consumers
Panel builders
Repetitive OEMs
System integrators, large installers, non-repetitive OEMs, EPC
Small and medium installers
Utilities
Other end users
Web giants

6 digital accelerators

Source
Make
Deliver
Plan
Care
Innovate

5 supply chain models

Collaborative
Lean
Agile
Project-driven
Fully flexible

8 key transformations

End-to-end customer lead times
Special care units
SIOP: Sales inventory op planning
Customer process capabilities
Network optimization and transportation
ETO supply chain management
Field services supply chain
Supply base management

Supplier Guide Book

Our Supplier Guide Book keeps our suppliers aware and accountable to our sustainable development expectations related to health and safety, human rights, ethics, and the environment. This is strengthened by the General Purchasing Terms and Conditions to which all Schneider Electric suppliers must conform.

DK Singh

Chief Procurement Officer, Schneider Electric

Social, environmental, and ethical responsibility for our upstream supply has been one of our key initiatives. Over the last several years, we have led efforts such as ISO 26000 and conflict minerals tracking and contributed to Green Premium and hazardous material compliance.