Putting our suppliers under the microscope
Nokia’s sustainable supply chain and sourcing team look at the suppliers and materials that contribute to Nokia products. We manage risk by helping to put together purchasing strategies with embedded sustainability requirements. We then undertake due diligence on our suppliers for sustainability, and this due diligence covers modern slavery, climate, safety, and other issues.
We need to ensure our suppliers are compliant with relevant regulations and contractual requirements, and therefore meeting our expectations.
The scope of this work includes not just examining our entire network of suppliers with whom we have contractual relationships, but we are also asking those suppliers to cascade our requirements to their suppliers.
As Pia Tanskanen has mentioned previously, because we outsource parts of our production process, it is not enough to just look at our own production facilities. We engage in regular monitoring and audits to ensure that our suppliers and partners are doing what they said they would do. Moreover, we collaborate with our suppliers around solutions to some of the greatest challenges such as climate change, materials circularity, and modern slavery. Our supplier due diligence extends down to the smelters and refineries processing the raw materials that go into our products. It goes further also covering the manufacturing of the components, final assembly, delivery, installation, optimization and managed services around network products.
Manufacturing happens at our own and supplier-managed final assembly factories. To give you an example, our supply chain (beyond sourcing) can include a logistics company picking up materials from one of our factories, delivering them into a transportation hub before then transporting it to the regional warehouse and final drop-off point for the customer installation project. Managing this process sustainably is key and can cover not just the CO2e footprint from manufacturing and transportation, but also the environmental reporting for delivered products that meets regulations on substances, future waste, packaging and battery regulations.
Our responsibility extends beyond what we ourselves do.
A lot happens in the provision of the manufacturing and provisioning of our products and services. In essence, a lot of our footprint happens already before a Nokia hand has touched the product in terms of things like CO2 emissions, water use, biodiversity and waste. It is therefore natural that we engage with our suppliers and partners and set similar standards as our own. Where there are gaps, we help to improve and act on the issues if suppliers are knowingly neglecting their accountability on compliance points that were agreed.
A lot of our time is therefore spent on compliance and due diligence. We have more than 11,000 suppliers so we take a risk-based approach in which we undertake a series of audits and assessments throughout the year to track our footprint within the supply chain. We can’t see everyone every year, but to demonstrate impact we need to be able to track it. We are moving further from a system of merely reporting the number of audits that we have undertaken to a system where we are looking at our footprint and handprint in areas such as climate, materials circularity, labour rights and social impact topics. We’re looking at the improvements made to reduce our negative footprint as well as the expansion of our positive impact. This includes supplier learning and capability building around areas that we ourselves as a company have experience and competence in, for example, topics like climate, materials circularity, inclusion and diversity etc.
With our purchasing power, we can also help the market to innovate around some of the world’s most polluting sectors. This can take many forms including showing the demand for sustainable products like clean energy, adoption of biofuels or metals that are produced with low emissions etc. An example here would be the use of biofuels such as sustainable aviation fuel in the planes that transport our products. By expressing our demand and outlining clear requirements for biofuels we can foster supply chain to further work with their suppliers for biofuels, develop their product offering and scale, so that the price premiums for such fuels would also go down and be more affordable to the entire industry.