Sustainable Supply Chain Management
Environmental sustainability and climate protection in the supply chain
A long-term partnership between Infineon and its suppliers is a core element of our corporate philosophy. Compliance with our requirements in the areas of environmental protection, occupational safety and health as well as corporate social responsibility (CSR) is highly relevant when selecting new suppliers and evaluating existing suppliers, as well as for decisions regarding future supplier development. Only suppliers that have committed to our basic principles can enter into a business relationship with us.
By anchoring sustainability requirements and monitoring measures in the procurement process, we increase the effectiveness of our supplier management, reduce possible risks, create transparency along the supply chain and initiate improvement processes at suppliers.
With the publication of our climate targets in the 2020 fiscal year, an initiative was launched where we work together with suppliers to drive forward environmental sustainability and climate protection in the supply chain. The main priorities of this initiative are scope 3 emissions and the circular economy. In the 2022 fiscal year, for example, at our manufacturing site in Dresden (Germany), close collaboration with suppliers enabled a new refurbishment process for structured wafers that were rejected in the course of manufacturing.
How do we manage our suppliers?
Supplier Management is the organization, controlling and development of supplier relationships. Supplier Management is based on four interlocking modules, through which uniform sourcing, evaluation, classification and development of suppliers is achieved. For more information please click here.
At Infineon, old and new suppliers have to fulfill a Corporate Social Responsibility questionnaire including Environmental Sustainability, Occupational Health and Safety, and Business Continuity questions among others.
More than 100 new suppliers and new subsidiaries of existing suppliers are categorized every quarter according to their products and services. Depending on this categorization, the supplier receives up to ten questionnaires on various topics in the supplier management portal. The responses received are evaluated by the relevant Infineon specialist departments. The supplier is only approved following a successful evaluation. When necessary, improvement measures are jointly agreed with the supplier. This procedure supports a fast and up-to-date assessment. The annual re-evaluation of selected suppliers serves to determine whether or not corrective measures need to be initiated. Each year, around 400 existing suppliers, representing approximately 75 percent of the procurement volume, are re-evaluated with regard to the topics mentioned.
Supplier Code of Conduct
Our Supplier Code of Conduct is based on internationally recognized guidelines, such as the Principles of the UN Global Compact and the fundamental principles of the International Labour Organization as well as our Business Conduct Guidelines. Infineon is a global member of the Responsible Business Alliance (RBA) and therefore have fully integrated the principles of the RBA Code into our Supplier Code of Conduct.
As stated there, all of our Suppliers shall comply with all requirements described herein. In addition, each of our Suppliers shall ensure that its affiliates, contractors and subcontractors also comply with all requirements described herein. Read our complete Supplier Code of Conduct
Our Supplier Code of Conduct cover the following topics:
Our commitment towards Conflict Minerals and Cobalt
DRC Conflict Minerals
Respect for human rights is a matter of course for Infineon. Avoiding conflict minerals in the supply chain means that we are contributing towards the prevention of human rights abuses.
Infineon is not listed on US stock exchanges and therefore not legally required to publish a report on conflict minerals. Nevertheless, as a member of the Responsible Minerals Initiative, we uphold our voluntary commitment to responsibility within the supply chain. At the same time, our comprehensive declaration on the use of conflict minerals supports those of our customers who are required to perform due diligence within their supply chains to fulfill their reporting duties in accordance with the requirements of the United States Securities and Exchange Commission (SEC).
Since Infineon does not source these metals directly from mines or smelters, we identify their origin in close cooperation with our direct suppliers. For this purpose, we have introduced a standardized process throughout the organization based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas in order to create the necessary transparency within our supply chain. Our targets and our requirements of our supply chain are set forth in the Infineon Conflict Minerals Policy and the Supplier Code concerning the Responsible Sourcing of Conflict Minerals. Read our Conflict Minerals Policy and our Supplier Code for a Responsible Sourcing of Conflict Minerals.
Voluntary cobalt assessment in our products
The Democratic Republic of the Congo has around 50 percent of global cobalt reserves and produces the largest quantity of cobalt in the world.
As a responsible company, Infineon has therefore, on a voluntary basis, expanded its activities relating to social and environmental responsibility in the supply chain by including cobalt in our due diligence program for the responsible procurement of minerals. In the course of our investigation, we identified all suppliers of material containing cobalt and questioned them about cobalt smelting in the supply chain. To ensure transparency, we are making the result of our review available to our customers in the form of a Cobalt Declaration (Cobalt Reporting Template).
Know more in our Sustainability Report page 41-43.