Siemens aims to be first industrial enterprise with environmentally friendly supply chain

Siemens is investing around up to €100 million until the end of 2012 to make its factories greener. The company is currently analyzing the environmental performance and energy efficiency of its some 300 most important sites worldwide. The goal is to reduce energy and CO2 emissions by 20 percent by the end of 2011. Siemens is also offering the green test to its suppliers. In the next two years, they will check their companies’ energy and environmental efficiency.

“We want to be the first industrial enterprise in the world with an entirely environmentally friendly supply chain,” said Barbara Kux, member of Siemens’ managing board and chief sustainability officer. It is estimated that the company’s 1,000 most important suppliers alone could reduce their CO2 emissions by 1.5 million tons a year and their energy costs by around €170 million.

In order to improve the energy and environmental records of its factories, Siemens is currently carrying out an inspection of its own production facilities, using the latest products of its environmental portfolio for the purpose. However, the supply chain does not begin at the factory gates – noticeable improvements could also be achieved with the supply firms. Siemens works particularly closely with around 1,000 suppliers. They were selected for their high purchasing volume and particularly energy-intensive production processes with energy accounting for up to 45 percent of their costs. They are thus particularly important if the energy consumption of Siemens’ entire supply chain is to be permanently reduced. The 80 largest suppliers among them are to undergo an environmental and energy check by Siemens experts around once a week. A further approximately 80 suppliers are undertaking a one- to three-day check with the help of Siemens specialists. More than 800 are to make their own, Web-based check. The remaining suppliers can carry out a shortened environmental check for their company online. Twelve suppliers, most of them with energy-intensive production processes, have already been checked. In every case there was scope for reducing the costs. Depending on the size of the production facility, energy and resource consumption could potentially be reduced by an average of almost 15 percent.

Siemens AG (Berlin and Munich) is a global powerhouse in electronics and electrical engineering, operating in the industry, energy and healthcare sectors. For more than 160 years, Siemens has stood for technological excellence, innovation, quality, reliability and internationality. The company is the world’s largest provider of environmental technologies, generating €23 billion – nearly one-third of its total revenue – from green products and solutions. In fiscal 2009, which ended on September 30, 2009, revenue totaled €76.7 billion and net income €2.5 billion. At the end of September 2009, Siemens had around 405,000 employees worldwide.