Supply chain management
The success of our business is influenced by the many valued suppliers who support our operations. In 2016, ExxonMobil made payments to more than 90,000 suppliers of goods and services worldwide. We strive to promote a healthy supply chain that respects human rights and the environment while creating opportunities for historically underrepresented groups.
As part of our supply chain management efforts, we have taken steps to foster a commitment to sustainability with our key suppliers. In 2016, we included a sustainability discussion in our supplier relationship management meetings with strategic suppliers representing more than $850 million in annual spending across nine commodity groups. These discussions — which cover human rights, environmental performance, local content and supplier diversity topics — opened the door to potential future collaborations to improve our mutual sustainability performance with these suppliers. For additional information on how ExxonMobil respects human rights in the supply chain, see the respecting human rights section of our website.
Performance and initiatives
Up Close: Improving environmental performance across the supply chain
We encourage our suppliers to take action to improve environmental performance, as outlined in ExxonMobil’s Supplier Expectations. We work in collaboration with key suppliers, where possible, to identify opportunities for continuous improvement in environmental performance that improve efficiencies and create shared value for our business and our suppliers. For example, we have worked with several suppliers in the U.S. Gulf Coast to reduce waste and improve waste handling at our facilities in Beaumont, Texas, and Baton Rouge, Louisiana.
By collaborating with Waste Management National Services, Inc., and its affiliates to apply its comprehensive waste profiling and analysis methods across ExxonMobil’s plants, we enhanced our waste disposal practices and achieved significant cost savings at our Baton Rouge and Beaumont locations. Our partnership with Waste Management has resulted in more than $2 million in cost savings due to increased recycling, improved waste classification and container optimization. In addition, Waste Management personnel have worked more than 100,000 person-hours without incident at the ExxonMobil refineries and achieved world-class safety standards.
Through our partnership with a valued supplier to the ExxonMobil Chemical Company, we were also able to reduce waste by reusing and recycling large polypropylene bags capable of holding 500 to 2,000 pounds of product at our Baton Rouge refinery. Rather than being disposed of in landfills, used bags are now collected, cleaned and repaired by a third party before being sold back to the supplier at a lower cost. Not only does this initiative result in an 80 to 90 percent reduction in the number of bags sent to landfill, but it also results in cost savings for our supplier and our own business. We value suppliers who can help us improve our own environmental performance, and we are now looking to expand these waste initiatives to other locations.
Promoting supplier diversity
ExxonMobil seeks to build long-lasting and mutually beneficial relationships with diverse suppliers to contribute to the economic development of historically underrepresented groups. In the United States, we have cultivated diversity across our supply chain for more than 40 years.
To help identify diverse suppliers, our supplier diversity database allows businesses from traditionally underrepresented groups in the United States to register an interest in being an ExxonMobil supplier. We consider the full reach of our supply chain, not just our direct spending, by tracking the progress of our primary suppliers in the use of diverse suppliers in their businesses. We refer to this as our Tier 2 program. This approach helps promote the sustainability of our supplier diversity program by encouraging our primary suppliers to join in our efforts.
We work closely with the National Minority Supplier Development Council (NMSDC) and the Women’s Business Enterprise National Council (WBENC) to help identify and develop relationships with certified diverse suppliers in the United States. ExxonMobil is consistently recognized as a leader in supplier diversity efforts. WBENC named ExxonMobil among America’s Top Corporations for Women’s Business Enterprises in 2016 for the 10th year in a row. For the first time, we received a Platinum Distinction, which is reserved for companies with leading supplier diversity programs in the top quartile. This national award recognizes corporations with world-class programs and leadership in supplier diversity that are setting higher standards and driving innovation in support of women’s business enterprises.
We continue to work with WEConnect International to increase the participation of women-owned businesses in our supply chain around the world. Women’s economic development is a global priority for ExxonMobil, and our international supplier diversity program currently focuses on women in a number of countries where we operate.
Performance and initiatives
In 2011, our spending with minority- and women-owned business enterprises (MWBEs) reached $1 billion in the United States. We have been able to maintain that level of spending with diverse suppliers for the past five years. In 2016, we exceeded our target with a total of $1.4 billion in spending with diverse suppliers in the United States. This represents the highest annual spending with diverse suppliers in our program’s history. These suppliers included minority-owned businesses; women-owned businesses; small businesses; lesbian-, gay-, bisexual- and transgender-owned businesses; veteran-owned businesses; service-disabled veteran-owned businesses; and businesses owned by people with disabilities. Suppliers from these groups have contributed to our total diverse spending in order to ensure a more inclusive supply chain.
Our supplier diversity program continues to expand into the international arena. In 2016, we spent a total of $203 million with women-owned and indigenous-owned businesses outside the United States. Of this, we spent $170 million with indigenous-owned businesses in Canada. Outside of Canada, we spent $33 million with women-owned businesses, representing a 57 percent increase from 2015.
Beyond spending with diverse suppliers, we aim to provide long-term growth and development opportunities to diverse suppliers through coaching, training and workshops. In 2016, we continued to increase ExxonMobil leadership engagement in our supplier diversity program. Sara Ortwein, president of XTO Energy, hosted a “CEO Academy,” an executive development session at the ExxonMobil Houston Campus in partnership with the Houston Minority Supplier Development Council. At the session, Ms. Ortwein shared leadership thoughts and the company’s philosophy.
President of XTO Energy
“Many businesses, while achieving success, can struggle with transitioning from operational to strategic leadership. Overcoming this challenge is critical for sustainable growth. I was glad to share my insights from my own leadership experience in order to help diverse business leaders in the Houston area grow and develop themselves as leaders, as well as expand their businesses. Developing a stronger, more diverse supply base not only helps the community, but also ExxonMobil’s business.”
Up Close: Partnering to celebrate America Recycles Day
ExxonMobil works to promote women-owned businesses and, where possible, include them in our supply chain. For example, CompuCycle, a women-owned company, began working with ExxonMobil in the area of electronic waste removal and recycling in 2015. CompuCycle was the first company in the Houston area to achieve R2 Certification, the recycling industry’s leading certification for electronic waste handling. This certification ensures that the electronic waste removed from ExxonMobil sites is handled in a safe, environmentally responsible and fully transparent manner.
In November 2016, ExxonMobil and the Houston campus sustainability team worked with CompuCycle to host an electronics collection event to celebrate America Recycles Day. The event helped educate ExxonMobil employees and local community members about the importance of responsible electronic waste disposal, and resulted in more than 11,000 pounds of electronic waste being disposed of safely and responsibly.
ExxonMobil Houston campus sustainability team recycling lead
“To celebrate America Recycles Day, the Houston campus sustainability team wanted to educate ExxonMobil employees and the local community about the benefits of recycling. CompuCycle helped us accomplish this, while also giving people an easy way to responsibly dispose of their electronic waste from home.”