Finboot is a technology company offering digital traceability solutions to clients in capital intensive and difficult to decarbonise industries such as oil and gas, chemicals, and steel.
Finboot’s CEO and Co-Founder at Finboot, Juan Miguel Perez, recently conducted a video interview with Ernesto Barcelo, Chief ESG Officer, at Gestamp. This blog is a summary and further thoughts and insights on that interesting conversation at a key point in time as the world looks to accelerate its journey to net-zero for the good of people and the planet.
Gestamp Automoción, S. A. is a Spanish multinational specialized in the design, development, and manufacture of highly engineered metal components for the main vehicle manufacturers – the OEMs (original equipment manufacturers). The company develops products with an innovative design to produce lighter and safer vehicles, which offer lower energy consumption and a lower environmental impact. Its products cover the areas of BiW, chassis and mechanisms. Gestamp is a well-established and respected player in this highly competitive, highly regulated and scrutinized sector.
Gestamp’s business was founded 26 years ago – in 1997. It is now a multinational company with a presence in 24 countries and 115 production sites, and perhaps more importantly, when thinking about the just transition to net-zero, it also has 13 R&D centres where it helps customers design new solutions to the challenges society faces today. Gestamp has 43,000 colleagues with around 1,500 (c. 3.5 per cent) R&D specialists.
In a wide ranging and enjoyable conversation, Ernesto recounted how Gestamp has always been mindful of the environment since it started trading in 1997. Ernesto went on to set out how Gestamp has embedded Environmental, Social and Governance (ESG) targets and considerations right across the business. He also offered numerous thoughts on how Gestamp is working towards monitoring progress on ambitious decarbonisation objectives. He stressed that greater transparency, trust and responsibility are foundational in meeting these challenges.
To meet these decarbonisation and net-zero targets and challenges, Gestamp is looking at their whole supply chain (upstream and downstream) and not just tier one suppliers. So, for example, on steel supply, this means knowing and working with steel makers who produce the iron ore that is made into the steel that Gestamp uses to manufacture automotive parts. This is total supply chain transparency and traceability.
Ernesto made it very clear that traceability and evidence backed data are essential – both for compliant reporting in an increasingly regulated world, but perhaps more importantly for effective decision making to accelerate digitisation and the journey to net-zero.
Juan and Ernesto spoke at some length about the Greenhouse Gas Protocol, and scopes one, two, and three. Scope one covers direct emissions from owned or controlled sources. Scope two covers indirect emissions from the purchase and use of electricity, steam, heating, and cooling. By using the energy, an organisation is indirectly responsible for the release of these greenhouse gas emissions. Scope three includes all other indirect emissions that occur in the upstream and downstream activities of an organization. Scope three is the biggest challenge for most companies – in the automotive sector and beyond. Decarbonising the energy system may add extra cost initially, but in the longer-term renewable energy is cheaper – and of course, better for the environment.
Gestamp’s number one material is steel followed by aluminium. Both face exactly the same challenges: metallurgical production processes have emissions embedded within them. Steel producers around the world are currently investing to produce steel low in emissions. While this technology is being fully developed and deployed, Gestamp is adopting a circular approach as an interim solution by using as much recycled steel as possible.
They also spoke about how our world is increasingly interconnected and increasing regulatory requirements. Gestamp, like all companies in the EU, is bound by the new EU Corporate Sustainability Reporting Directive, compelling them to produce more granular reports about the effects their business and its entire value chain has on the environment. There are similar regulations coming in other markets, such as North and South America and the Far East.
These twin drivers are wanting to do the right thing for the environment, its stakeholders (including its staff, customers, suppliers, and investors) and de-facto global regulations means Gestamp is accelerating its digitisation by investing and collaborating with tech firms like Finboot. In this new world, blockchain is a vital tool to help monitor and measure and improve supply chains – in line with its ESG goals. Gestamp needs to control and monitor all aspects of its business and, at the same time, have trusted, open and honest dialogues with all the different suppliers and stakeholders – in a non-siloed way – to find the solutions to accelerate its journey to net-zero. The words trust and transparency kept coming up!
Juan reflected after the interview that he is confident that with this honest and can-do attitude, Gestamp will meet these significant challenges, navigate the Fourth Industrial Revolution and thrive. Finboot and Gestamp look forward to going on this important journey together.