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Annual Report 2016

Partners

Management of supply chain

G4-DMA Supplier environmental assessment, G4-DMA Supplier assessment for labor practices, G4-DMA Freedom of association and collective bargaining, G4-DMA Child labor, G4-DMA Forced or compulsory labor, G4-DMA Supplier human rights assessment, G4-DMA Supplier assessment for impacts on society, G4-12

Embraer’s supply chain is divided into 1,200 direct suppliers, with which resources are traded for the manufacturing of products, and 3,000 indirect suppliers, who support technical and administrative activities. The relationship with this public is guided by the Code of Ethics and Conduct (see Ethics and integrity) and goals are established in the Master Sustainability Plan (see Master sustainability plan).

Business partners are subject to risk assessments that include monthly monitoring of performance indicators, face-to-face audits at contractor companies’ plants and the periodic assessment of environmental impact surveys. In addition, all contracts contain clauses regarding human rights and labor as well as environmental laws. This year, no significant negative impacts were identified with regard to labor practices in the supply chain. G4-EN32, G4-EN33, G4-LA14, G4-LA15, G4-HR1, G4-HR4, G4-HR5, G4-HR6, G4-HR10, G4-SO9

AERONAUTICS CHAIN DEVELOPMENT PROGRAM (PDCA, in Portuguese)

In partnership with the Brazilian Industrial Development Agency (ABDI, in Portuguese), the PDCA seeks to improve all companies involved in the direct supply of industrial processes. The initiative was based on the Excellence Management Model (MEG, in Portuguese) of the National Quality Foundation (FNQ, in Portuguese) and promoted significant improvements related to service, costs, quality and waste reduction.

Evolution of PDCA in 2016
Increase of 12% for delivery volume and increase of12.4% for billing.
Part numbers number
2014
2016+10.1%
High risk suppliers
2014
2016-83%
Direct employment
2014
2016-2%
On-time deliveries
2014
2016+7.7%
(97.2% of deliveries made on-time)

EXCELLENCE IN MANAGEMENT PROGRAM (PEG, in Portuguese)

An initiative that aims to enable indirect suppliers to continuously pursue excellence, contributing to increased productivity and technical improvement.

Companies – selected from risk mapping and cost reduction opportunities – participate in courses on lean management philosophy and receive guidance for kaizen practices (continuous performance improvement).

EVOLUTION OF PEG IN 2016
3 classes
trained
17 projects
completed
14 goals
defined
231 measures
identified
32 hours
of training
More than 640
hours of kaizens
Reduction of 169 days and
9 hours of processes
Savings of
R$12 million
1
Identification of suppliers
2
Theoretical training
3
Kaizens
4
Presentation
of results