Expanding compliance processes and tools to better manage sustainability

Many companies voluntarily go beyond regulatory requirements, setting higher expectations and standards supporting sustainability initiatives. Many well-known organizations, some of which are household brands, are leading by example and working towards a more sustainable future. With increasing consumer demand for sustainable and ethical products, demonstrating leadership is becoming an important characteristic that sets successful companies apart.

Going beyond compliance

Many such companies have chosen to upgrade their existing compliance processes and tools to support their action on sustainability and going beyond compliance, such as

1. Reducing the use of hazardous substances ahead of regulations: Many ACEA member companies and IMDS Steering Committee members take a proactive approach to meet and exceed regulatory requirements whenever technically and economically feasible. Examples include the elimination of Hexavalent Chromium ahead of the EU ELV deadline and prohibited substances listed in the REACH Annex XIV SVHCs prior to Sunset Date, regardless whether authorizations will be issued or not.
2. Increasing the use of sustainable, recyclable, and reusable materials to achieve better circular economy targets: Many automotive OEMs like GM, Ford, Daimler, Toyota, and Volvo have announced their future sustainability goals such as zero crashes, zero emissions and zero congestion, 100% sustainable materials, reduction of CO2 emissions in new vehicles as well as elimination of CO2 emissions in all materials used to produce vehicles, and in all manufacturing, and carbon-neutral products and manufacturing. Major high-tech electronic manufacturers have announced their carbon neutrality targets as well. Apple aims to achieve carbon neutrality across their entire business and manufacturing supply chain by 2030 – 20 years earlier than the EU Green Deals target. Microsoft has made the same commitment, whilst Amazon aims to achieve carbon neutrality by 2040, one decade ahead of the Paris Agreement as part of their Climate Pledge.
3. Prioritizing safer materials and chemicals to support design-for-compliance and design-for-sustainability practices before deadlines are set by regulators: We can see this unfold at scale at many levels: at EU-level, State level (CA, WA, ME, MN) and also at company level. A study by Clean Products Action examines how major retailers like Target, Walmart, and Bed, Bath and Beyond are targeting the reduction of chemicals of high concern to human health or the environment in their products. Many automotive OEMs and suppliers have incorporated the compliance status of materials into design and development phases to avoid late design changes and non-compliance risks.
4. Optimizing manufacturing processes, transport, and logistics to reduce waste and carbon footprint.
5. Implementing material traceability and increasing the scope of reporting beyond regulatory requirements: A range of companies subject to the US and EU Conflict Mineral regulations have surpassed the four legally affected commodities and have added other minerals such as Cobalt and Mica to their reporting and tracking list.
6. Assessing technical and financial feasibility in conjunction with sustainability performance of individual parts, components, materials, and substances: Establishing this baseline allows organizations to create commercially feasible implementation plans to systematically replace current materials with better alternatives.
7. Working closely with suppliers and other value chain actors on aligning sustainability goals to create a bigger impact throughout the product lifecycle: Apple, for example, actively work with their suppliers to reduce the carbon footprint and establish a closed-loop supply chain to support their long-term goal of using 100% recycled materials in all of their products. The iPhone 11 Pro is the first Apple product that contains 100% recycled rare earth metals.

There are many more examples like these practices across all industry sectors.

This article is the fifth in our series of nine articles dedicated to the topic “From Compliance to Sustainability – Managing Material Lifecycle in the Circular Economy Era”. It is addressed to senior decision makers, managers, compliance officers, engineers, and any corporate citizen interested in the most important steps of your journey from compliance to sustainability. Starting with material compliance, we will explore the entire material life cycle and the connections between corporate sustainability goals, circular economy, and digital technology. Thereby, we will lay the focus on business processes, IT solutions, and the utilization of data as the three key elements which – in combination with sustainability and the circular economy – create greater value for companies and their value chains.
Stay tuned for our next article in this series, which will focus on iPoint’s role and why we see compliance and sustainability as part of the same circle.

About the authors

Maroye Marinkovic is the Product Innovation Manager at iPoint, where he brings in his skills as a solution designer, digital strategist, and a communicator with a passion for improving sustainability, efficiency, and compliance across value chains. Based in Melbourne, Australia, he has more than 10 years of experience in conceptualizing, designing, and implementing enterprise compliance, sustainability, and risk management software solutions. Maroye’s specializations include chemicals management, platform design, blockchain solution design, circular economy, and business strategy.

Dr. Bing Xu joined iPoint in Ann Arbor, Michigan, at the North America main office in 2019 as Director of Business Innovation. In this role, he supports iPoint’s customers in different industries with their material compliance programs as well as their sustainability, circular economy, and digital twin projects, to integrate material compliance programs into their core product development processes and reduce non-compliance risks and improve engineering efficiency.

Before joining iPoint, Dr. Xu was Ford Motor Company’s Global Materials Compliance Program Manager. Spearheading Ford’s Global Materials Management program in early 1997, he was one of the original OEM members who developed and launched the International Data Management System (IMDS) for the automotive industry in 2000. He was Ford’s global attribute leader for material/substance compliance and material life cycle management, and a member of Ford’s Sustainability Council, managing both internal compliance and external suppliers’ compliance. He also led Ford’s cross-functional teams and developed various material compliance-related processes and IT tools for Ford since 1997. Furthermore, Dr. Xu was the owner of Ford’s Restrictive Substances Management Standard (RSMS) and the owner of the Ford’s internal material/substance compliance processes/tools.

He has served as chair and co-chair in several committees of leading industry organizations and work groups, such as the US Automotive Industry Action Group (AIAG)’s Chemical Management Advisory Group, the United States Council for Automotive Research (USCAR)’s Substances of Concern Group, the Global Automotive Declarable Substance List (GADSL)’s Steering Group; and he has supported projects of the US Environmental Protection Agency (EPA) on Alternative Assessments, and TSCA industrial data collection and evaluations.

A recognized and highly respected expert of the automotive industry, he has been invited to speak at many conferences and forums hosted by different industries and governmental agencies, e.g., Electronics, Building Materials, Heavy Machinery, Chemicals, Apparel, Home Appliances, California Safer Consumer Products and Alternative Assessment conferences/workshops, and SAE US Government Industry Meeting.