Dec 15, 2021

Continental Commits to Sustainable Natural Rubber Supply Chain on HeveaConnect

With immediate effect, the premium tire manufacturer Continental will handle part of its purchasing of natural rubber through a digital trading platform designed to ensure greater transparency and sustainability in the natural rubber supply chain.

“Our goal is to procure all materials from responsible sources. The key to achieving this lies in innovative technologies and digitalization, which can make a decisive contribution to transparency in complex supply chains,” says Dr. Andrea Appel, Head of Purchasing of the Tires business area at Continental. She adds: “HeveaConnect shows how digital platforms enable solid analyses of complex supply chains as well as their targeted management. Ecological, social and financial risks are made equally transparent for all market participants. Targeted additional offers provide attractive incentives for producers to act sustainably.”

The HeveaConnect platform validates key aspects of a sustainable supply chain and ensures compliance through transparency and special offers. Platform participants are provided with a dashboard showing standardized information on quality, traceability, and compliance with social and environmental standards, as well as information on average selling prices. In addition, Continental can use the platform to call up offers from rubber suppliers in real time, compare and negotiate them, conclude short- or long-term supply contracts and document them electronically.

Consulting services with special conditions that demonstrably adhere to certain minimum standards are made available to natural rubber producers via HeveaConnect. For example, it is possible to integrate information on the platform that results from risk analyses carried out by Rubberway. Rubberway is a joint venture between Continental and Michelin that analyzes the entire supply chains in the natural rubber sector according to a points system, and thus assesses sustainability risks for suppliers and their subcontractors. “Our platform aims to make trading in physical natural rubber more efficient, transparent and provide buyers with key sustainability focused data to make better procurement decisions. We create data-backed rubber by pairing the sustainability information with the physical rubber product that is traded on our platform. Continental has long been committed to sustainable supply chains and we are delighted to have them join HeveaConnect. Through the engagement of Continental and other industry players on our trading platform, we are one step closer to creating data-backed physical indices. With the help of the Singapore Exchange (SGX), we thus aim to complement the SICOM benchmark, the global price index for natural rubber, with an index with greater price granularity”, explains Gerald Tan, CEO of HeveaConnect.

Creating sustainable and traceable supply chains is a key component of the comprehensive sustainability strategy of Continental’s Tire business area. Responsible sourcing of raw materials helps to minimize ecological and human rights-related risks. For this reason, the use of sustainable raw materials in tire manufacturing and the commitment to and acceptance of responsibility for their sustainable production and processing have long been a high priority at Continental. Continental has set itself the goal of becoming the most progressive tire company in terms of environmental and social responsibility by 2030. By 2050 at the latest, Continental aims to use 100 percent sustainably produced materials in its tire products and achieve complete climate neutrality along its entire value chain.

Continental is actively promoting greater sustainability in the extraction of natural rubber through various strategic projects. As a founding member of the Global Platform for Sustainable Natural Rubber (GPSNR), the company is actively promoting solutions for better traceability together with partners. The premium tire manufacturer is also involved in a wide range of projects. These include the Rubberway joint venture, which specializes in identifying sustainability risks in the natural rubber supply chain, as well as the cooperation with the German government’s development service Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), in which the company is contributing to a project to train smallholders and introduce digital traceability systems throughout the supply chain. Furthermore, Continental is working with Security Matters (SMX) on a development project, in which marker technologies are being used to trace natural rubber.

Source: Continental