Ford Motors Company - ESG Overview Report, 2021

Environment, Social and Governance (ESG) at Ford Motors Company

The policies that impact environment, social, and governance, which are made by the companies, involving the consumers and the governments, are shaping the current trend in investments in an unprecedented manner.

Being one of the key leaders of the automotive industry, Ford Motor Company has focused on Environment, Social, and Governance, focusing on promoting an eco-friendly way of logistics, sustainable transportation, and community inclusive method of operations. In regard to this, Ford Motor Company has made policies that define its core ethical values of governance, striving to make a positive impact in all three areas of ESG and aims to closely align with the United Nations’ Sustainable Development Goals (UN SDGs) for promoting ESG performance and ESG impact.

Depletion of natural resources as well as the advancement of technology in the automotive industry, has led Ford Motor Company to adopt sustainable technologies and policies.

ESG Trends

The internal governance policies of the Ford Motor Company are aligned with the United Nations Sustainable Development Goals and the company has aimed to achieve carbon neutrality by 2050. At the core, the Ford Motor Company has sustainable policies inclusive of human rights policies, data protection policies, product safety and business ethics, and sound corporate governance policies.

To enable this goal, Ford Motor Company has made changes in its production operations to reduce climate change, where it has set a goal of making all of its products with net zero emissions by 2035. It aims to achieve this by introducing a new line of EV product range by 2035, both in passenger and commercial segments. The methods used to reduce the scope 1, scope 2, and scope 3 emissions are aligned with science-based targets and the company has made an Environmental policy to achieve the aforementioned targets. Further, the company has focused on the decarbonization of the supply chain to achieve net zero targets.

Introduction and execution of responsible material sourcing policy, which mandates the members of the supply chain to understand and responsibly mine minerals such as tin, tungsten, tantalum, and gold responsibly is a major environmental initiative by the company. Since the mining of metals causes heavy distress on the environment, Ford Motor Company’s focus on this issue steers a positive impact on the environment.

Furthermore, the usage of blockchain technology for tracking and investigating the cobalt sourcing for producing the EV production line the Ford is enabling the purchaser to track the data regarding the materials, promoting responsible mineral sourcing. 

In regard to the social and governance aspects, Ford Motor Company drives a positive impact where it focuses on the promotion and integration of human rights, ensuring executive compensation is tied to non-financial metrics, increasing independent directors on board, and having a strong compliance culture. .

Future of ESG at Ford Motors Company

Ford Motor Company’s revenue was around USD 127 billion. Ford Motor Company has made initiatives and policies that create a positive impact on the environment and society in parallel and these policies reflect the core values of the company, which aim at reducing the carbon footprint and emissions as well as promoting sustainability in terms of environment and human rights.