Material Procurement

Man on phone at worksite
Man on phone at worksite

 

Caterpillar responsibly sources the raw materials used to build our products.

As the world’s leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives, Caterpillar responsibly sources the raw materials used to build our products.

Our supply base includes approximately 27,000 suppliers around the world providing raw materials and manufactured components across broad categories and technologies for aftermarket and production parts. These purchases include a variety of unformed steel products, cut or formed to shape and machined in our facilities; steel and iron castings and forgings, machined to final specification; and finished components, made to Caterpillar or supplier-developed specifications. We also help keep those materials in circulation for as long as possible.

We maintain global strategic sourcing models to meet our global facilities’ production needs while building long-term supplier relationships. We look for suppliers and business allies who demonstrate strong values and commit to the ethical principles outlined in the Caterpillar Supplier Code of Conduct. We also expect suppliers to comply with the sound business practices we embrace, follow the law and conduct activities in a manner that respects human rights.

 
Cat Machine at work
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Cat Machine at work

Supplier Diversity

Supplier diversity continues to be a focus for our strategic procurement team. With a strong base of diverse suppliers already in place, we are investing in tools that will help identify diverse suppliers for new business opportunities. This is key to delivering on our commitment to foster and increase business purchases with diverse suppliers.


 

Responsible Mineral Sourcing

Many considerations go into the responsible sourcing of minerals used in our products. Tin, tungsten, tantalum and gold (3TG), collectively known as “conflict minerals,” have been associated with human rights violations in the Democratic Republic of the Congo and adjoining countries. Our Conflict Minerals Position Statement contains clear expectations for our suppliers regarding their sourcing of these materials. We have established a process that identifies areas of risk on an ongoing basis, and corrective action plans to mitigate or remediate such risks relating to conflict minerals. A supplier’s failure to take corrective actions when required may lead to additional actions, up to and including the termination of our business relationship.

Caterpillar supports the Responsible Minerals Initiative to help influence smelters’ engagement to support supply chain transparency and leverage industry collaboration toward greater business intelligence. Year over year, we strive for an increased supplier response rate, emphasizing 3TG priority suppliers. Caterpillar also publicly discloses the results of our Reasonable Country of Origin process and any necessary due diligence in Form SD and Conflict Minerals Report as required by the Securities and Exchange Commission, which discloses metrics and results of inquiries we execute within our first-tier suppliers. In these reports, we describe our due diligence efforts, including risk mitigation and process improvements we expect to implement in the following year.