Social hotspots in the automotive industry’s aluminum value chains—combining primary and generic data

Abstract

Purpose: The automotive industry and its suppliers have been facing increasing challenges in the sustainable sourcing of raw materials on environmental and social levels. To identify social risks in the value chain of aluminum in the automotive sector, this study aimed to examine how a generic hotspot analysis based on S-LCA can be conducted and support the reporting according to new legislative requirements such as the German Act on Corporate Due Diligence Obligations in Supply Chains. Methods: This study investigated the social risks in the supply chains of two selected aluminum components of an aluminum company using a generic social hotspot analysis based on the UNEP Guidelines for Social Life Cycle Assessment of Products and Organizations 2020. The study employed the generic PSILCA© database and different additional indicators for the assessment. The UNEP Guidelines 2020 used in combination with the associated methodological sheets were beneficial in structuring the procedure within the social hotspot analysis. They gave the inexperienced user a guide, which led to the results presented in this work. Results and discussion: A high number of social hotspots in upstream processes outside Europe across the different investigated indicators for both supply chains assessed were detected. Most social risks were identified in Guinea, as well as in a European and an Asian Country in the stakeholder categories “Workers” and “Local community.” Especially, the alloy element production in the Asian Country and the bauxite mining in Guinea showed an above-average number of social hotspots. The implementation of the work was associated with an enormous effort in information collection about the supply chains to be investigated and depended on the direct suppliers’ willingness to contribute. The need for a safe and supporting environment for suppliers to enhance transparency was identified. Conclusions: Combining generic and company data to conduct a social hotspot assessment (e.g., using PSILCA©) to meet legislative requirements proved to be a suitable approach for complex supply chains such as the automotive one. Despite this, limitations of the PSILCA© database and potential for improvement were acknowledged regarding industry-wide social assessments of supply chains. Additionally, the study serves as an application example of the UNEP Guidelines 2020 and the activity variables for science in practice. Further development and standardization of social indicators and activity variables for impact measurement were identified as a research priority.