Improving lives, in partnership with our suppliers, starts with putting the right policies in place.
Setting clear expectations for our suppliers.
As part of our Sourcing Sustainability Standard (PDF, 20KB), expectations are set for suppliers through 3M’s Supply Chain Policies: EHS, Transportation, Labor/Human Resources and Supplied Materials. These policies apply to the selection and retention of all suppliers that provide goods and services to 3M worldwide. We selectively review supplier performance to these policies. When noncompliance is detected, 3M will attempt to work with the supplier concerned to correct the situation. We expect the supplier to develop a corrective action plan to bring its operations into compliance. If a supplier does not develop such a plan or fails to implement it, 3M will move to terminate the business relationship.
In 2000, we set a goal to review at least 80% of Supplier Spend in the following countries: China, India, Korea, Malaysia, Taiwan, Thailand, Brazil, Mexico, Russia, and Turkey to drive conformance with 3M EHS, Transportation & Labor/Human Relations Standards by 2005. In 2013 we achieved our goal to review 80% of our spend in those countries.
Equal access to business opportunities is not just deserved, it’s a priority.
3M has a long-standing commitment to sustainable business practices and supporting the economic success of our communities. This includes working with both diverse and small-business suppliers. For 3M purposes, a diverse supplier is any supplier who qualifies for one or more of the following classifications: Minority-owned business, Women-owned business, Small Business (including Small Disadvantaged, HUBZone, Woman, and Veteran/Service Disabled Veteran.)
3M proactively identifies these suppliers to procure goods and services, strongly encourages the use of diverse suppliers across our Sourcing organization, and proactively reaches out through our involvement with various organizations, including the National Minority Supplier Development Council (NMSDC), Women’s Business Enterprise National Council (WBENC), Metropolitan Economic Development Association (MEDA), Small Business Administration (SBA), and others.
3M establishes goals and regularly tracks the dollar value of goods and services purchased from small businesses and diverse suppliers in concert with goals set annually with the U.S. Federal Government as part of our Subcontracting Plan for Federal Government contracting. To achieve our goals, 3M is implementing a 4-part strategy aimed to: 1) increase our spend with current diverse suppliers by reviewing our existing diverse Suppliers by diversity category; 2) identify additional diverse suppliers in our existing supply base by reviewing our top non-diverse suppliers by commodity team; 3) find “new-to-3M” diverse suppliers; and 4) further disrupt the status quo by working to move some of our Tier Two dollars to Tier One and focusing on diverse suppliers in our RFP activity. Our progress is closely tracked by leaders at all levels of the organization.
In 2014, 3M spent $1.5 billion dollars with small businesses, representing 27% of our total US domestic spend. We purchased $200 million dollars with diverse suppliers, which represents 3.6% of total US domestic spend.
3M continues to reassess elements of our approach, working across the industry to glean best practices. We remain committed to supporting small business and diverse suppliers and their positive impact on the economic viability of communities.
One issue addressed by 3M’s Supply Chain Policies is that of “Conflict Minerals.” Concern that proceeds from the mining of minerals (specifically tin, tantalum and gold) in the Democratic Republic of the Congo (DRC) have been used to fund extreme violence in that region led to a requirement in the U.S. Dodd-Frank Financial Reform Law of 2010, that U.S. publicly-traded companies identify the source of these minerals necessary to the functionality or production of products they manufacture or contract to manufacture.
3M’s reasonable country of origin inquiry and conflict minerals due diligence program are described in 3M’s Form SD and Conflict Minerals Report, available at the following link: SEC Filings.
3M is a member of the Conflict Free Sourcing Initiative (CFSI), an industry-wide initiative to develop control systems regarding smelters and refiners through independently validated audits under CFSI’s Conflict Free Smelter (CFS) program. 3M encourages its suppliers and any other companies not already members to join the CFSI. Increased participation throughout supply chains will strengthen collaborative efforts to increase leverage on smelters and refiners to join the CFS program and become validated as DRC Conflict Free. In furtherance of 3M’s commitment to CFSI and the CFS program, in January of 2014 3M made a donation to the CFSI Smelter Fund, which provides financial assistance to smelters undergoing a first-year audit under the CFS program. This fund encourages smelters to join the CFS program and become validated as DRC Conflict Free.
Supplier-directed information is available at the following link: Conflict Minerals.