Sustainability

Our drive to be an active part of the global transition towards sustainable mobility.  We integrate Sustainability into our overall Business Strategy, as we focus on improving vehicle fuel efficiency, creating value for our stakeholders, and ultimately strive to enhance overall environmental, social and economic well-being. Through Environment and Climate Innovation, Value Chain Engagement and Business Integrity, we show continued support for our People and Communities.

For a more detailed view of our sustainability framework and KPI’s, please refer to our annual report 2024.

Nemak has identified key aspects of an effective sustainability strategy based on our materiality assessment, as we have narrowed down the areas of increased focus and commitment to long-term priorities to enhance our contributions toward a more sustainable future. Visit our annual report 2024 for more details.

We Support UN Sustainable Goals as well as the UN Global Compact, ensuring we align our strategy and actions to the global aim of improved environmental, economic and social conditions.

As our Sustainability Strategy continues to evolve and adapt to the growing pressures from society, stakeholder and customers, we have devoted significant efforts towards improving the level of our transparency. We actively participate and partake in the shown ESG schemes

As part of the Company’s efforts to drive innovation and shape the future of automotive light weighting, it seeks to harness its technology, operations, and business practices to contribute to the automotive industry’s goal of reducing its carbon footprint. In magnitude of action, Nemak has established ambitious climate targets following approved Science Based Targets.

In order to reinforce Nemak’s commitment to address environmental challenges, effect positive impact through its operations and deliver on its commitment to provide sustainable solutions to its customers, Nemak has issued two Sustainability-Linked Bonds (“SLBs”) one in US dollars maturing in 2031 and the other in euros maturing in 2028.

To achieve, our climate strategy on a global level, we have built our framework on the following three pillars:

GREEN PRODUCTS​

• Low Carbon Products and Solutions
• Products that support global decarbonization
• Integration of circular economy principles into our products

GREEN PRODUCTION

• Continuous improvements in energy efficiency
• Technical innovation in processes

GREEN SOURCING

• Use of renewable energy
• Use of secondary alloy

As an energy intensive business, the efficient use of energy and use of renewable sources is a critical aspects for Nemak. Some of our key actions in area include: 

• Applying international standards such as ISO 50001, with which 33% of our facilities already in compliance. By 2022 we aim to have 100% coverage of ISO 501001 through out all our plants.
• Nemak plans to increase the percentage of renewable energy in its production processes to 25% by 2025, and to 70% by 2030.
• In 2021, Nemak’s total renewable energy contracts and certificates represented approximately 10% of its overall electricity consumption.

Circularity, Waste and Water Management

As Nemak strives to work in a circular economy approach, it continues to increase its use of recycled materials, engaging proactively with its supply chain and encouraging similar responsibility among its suppliers, while simultaneously increasing technical collaboration with its customers.

Although we are not a water and waste intensive business, based on global concern and scarcity for the resource, we continue to implement programs aimed at effective water management. Nemak owns and operates 23 wastewater treatment plants that remove contaminants and purify wastewater prior to discharge into local systems. To address the issue of water scarcity, Nemak has developed a water management strategy pursuant to ISO 14001 requirements, and has implemented it on a location-specific basis.

To Nemak, Sustainable Supply Chain Management encompasses active engagement with suppliers to align with Nemak's corporate targets and values, ensuring responsible environmental, social and economic practices throughout the entire supply chain.

Some key highlights in this area include:

• Supplier Sustainability Roundtable discussions on an annual basis
• Sending out commitment letters or letters of intent to our critical suppliers to accept to a CO2 reduction plan in line with Nemak’s goals
• Carrying out supplier audits
• Applying strict selection criteria, including mandating our suppliers to align with the Global Business Code for Suppliers

At Nemak, Occupational Health and Safety refers to the physical and mental well-being of our employees by providing a work environment that meets and exceeds the applicable legal standards for OHS. We aim to reduce the number and severity of work-place related injuries and lower the impact of errors and mistakes through preventative programs to identify and eliminate risks, employee training and mental-health awareness initiatives.

Diversity and inclusion

When we refer to Diversity and Inclusion, we refer to creating an inclusive culture built on equity, equality, and non-discriminatory principles. For Nemak, this includes the topics of workplace diversity (age, race, disability, ethnicity, other characteristics are what make Nemak’s employees unique), equal opportunities for recruitment, selection, career development, and learning, fair compensation and benefits, and avoiding complicity. Nemak's Code of Conduct and Diversity and Inclusion Policy provide a guideline for our employees, as well for our suppliers.

One of the four pillars of the Company’s sustainability model is to create sustainable value for the communities where it operates. As a good corporate citizen, it implements social, cultural and community projects as a core element of its strategy. Nemak sees itself as a local driver of growth, contributing to structural development, education, and equal opportunities in the communities where it is present.

Some examples of Nemak’s community engagement in 2021:

• In Mexico, Nemak supported the maintenance and renovation of school infrastructure in low-income areas near its facility, benefitting around 2,500 children in partnership with the regional government.
• We continued our annual support for the ALFA Fundación, donating approximately US$950,000 and helping more than 1,700 people. Nemak Mexico donated more than US$1.39 million to the benefit of approximately 5,000 people, and over 200 employees joined initiatives to help local communities

Sustainability has become key, fundamental topic globally and within Nemak. This is particularly true as current national and international regulations and mega trends evolve, thus reflecting Nemak's commitment to strengthen efforts to collaborate to achieve its sustainability milestones. As result, Nemak has developed a governance structure to best develop and execute its sustainability commitments.

We have created a Sustainability Committee for the purpose of guiding and linking the overall sustainability strategy with roadmaps and targets from the specific functions. The committee consists of high-level executives from the various functions such as: Global HSE, Business Development, Manufacturing, Purchasing, Commercial, Governance, Human Resources, Communications, and Investor Relations and meets on a six-week basis.

In addition, Nemak has a dedicated climate task force to set ambitious emission reduction targets in alignment with the Paris Climate Agreement. Their objectives include developing a comprehensive Climate Roadmap to Net Zero for Nemak based on the Science Based targets, identifying both pathways to achieving climate neutrality and ways to reduce Nemak’s vulnerability to climate impacts.

Nemak recently performed a comprehensive materiality assessment to identify areas requiring increased focus and reviewed its long-term priorities to enhance its contributions toward a sustainable future. The Company gathered input from internal and external stakeholders to ensure the assessment contained the most accurate information and reflected Nemak’s organizational priorities. These stakeholders included shareholders, employees, customers, suppliers, community members, and non-governmental organizations.