Furniture Industry: Creating Value and Impact Through Sustainable Supply Chain Management – Steelcase Inc. Supply Chain Sustainability Michigan State University Greening of the Supply Chain Conference April 21, 2014 Norman Christopher & John DeAngelis

The “New” Economy Linear Economy Natural ResourcesTakeMakeWasteDispose ◦Technical and biological materials mixed together ◦Energy from finite sources e.g. petrochemical sources Circular Economy Make Consume Enrich Biological Materials Technical Materials Energy from renewable resources “REs”: Reduce, Reuse, Remanufacture, Refurbish, Recycle, Reassembly, Reimagine! Source: Adapted Ellen McArthur Foundation Make Use Return Manufacture e.g. industrial symbiosis Earth e.g. compostable

Steelcase Supply Chain Sustainability Multiple ways Steelcase influences sustainability in the supply base: 1.ANSI/ BIFMA e3 Furniture Sustainability Standard 2.Purchasing better materials 3.Supplier Scorecards Image Source:

ANSI/BIFMA e3 Furniture Sustainability Standard Provides a pathway towards sustainability ▫Establishes measurable criteria for multiple levels of achievement and/or performance Divided into three categories ▫Organizational points ▫Facility points ▫Product points level certification – third-party verified ▫Over 4,900 products certified in the industry Source:

ANSI/BIFMA e3 Furniture Sustainability Standard ElementFocus Area Examples MaterialsDesign for Environment (DfE) (P); renewable materials; recycled content; Life Cycle Analysis (LCA); extended product responsibility; waste management; water management Energy and AtmosphereEnergy policy (P); building energy performance; embodied energy; GHG emissions Human and Ecosystem HealthRisk and Environmental Management Systems (EMS) policies (P); ISO or equivalent; effects of product, process, and maintenance chemicals; reduction/elimination of toxic chemicals Social ResponsibilityLabor and human rights (P); employee health and safety (P); social responsibility and reporting; supply chain management Note: (P) primary Source:

Steelcase’s Impact Through Materials Variety of positive impacts through materials: ▫Dematerialization ▫More durable ▫Increased recycled content ▫Cleaner materials ▫Lower processing energy ▫Higher recyclable content Supplier partnerships aid in new material discovery Must keep cost in mind

Steelcase’s Impact Through Supplier Scorecards Scorecards are a way we grade our suppliers’ performance ▫Quality ▫Prompt Delivery ▫Sustainability Sustainability aspect of scorecards ▫Gives opportunity to reward supplier initiatives ▫Increases discussion regarding sustainability

Furniture Industry Sustainable Supply Chain Management Best Practices Design and Engineering Product and Business Development Material InputsManufacturing Distribution and Logistics UseEnd of Life Design for the Environment (DfE) Green Chemistry Life Cycle Analysis (LCA) Clean Technologies Resource Management Sustainable Purchasing Renewable Resources Fair Trade Sustainable Transportation Sustainable Packaging Resource Conservation and Efficiency e.g. water and energy Sustainable manufacturing Waste Minimization Environmental Management Systems (EMS) eg ISO Employee Health and Safety (EHS) Pollution Prevention (P2) GHG Emission Mitigation and Adaptation Environmental Impact Reduction Disposal Sustainability Standards and Certifications Education and Training Product: Return, Re-use, Re-Manufacture

Furniture Industry Sustainable Supply Chain Management Value Creation Business Value Drivers Value Creation Drivers Sustainability Strategies and Approaches Revenue and Margin Growth Profits Total Business Value Managing Risks Realizing Efficiencies Developing Sustainable Products Creating a Culture of Responsibility Improving Brand Image Differentiating and Disrupting the Competition Generating Pricing Power Establishing Cost Savings Increasing Market Share Entering New Markets Environmental Management Systems (EMS) Design for Environment (DfE) Life Cycle Analysis (LCA) Employee and Customer Health and Safety Asset Productivity Training and Education Innovation and Creativity Source: Adapted BSR: The Business Case for Supply Chain Management Avoided Costs Higher Productivity Better Quality Products Material Reuse Waste Minimization Accrued Savings Reduced Liabilities and Risks Improved Safety Reinvestment Savings Sustainability Reporting Improved Decision Making Risk Management Enhanced Brand Reputation Customer Loyalty Sustainability Recognition

Thank you! Norman Christopher Executive Director Sustainable Community Development Initiative Grand Valley State University John DeAngelis Global Procurement Steelcase Inc