STRATTEC SECURITY CORPORATION
Climate Impact & Sustainability Data (2023, 2024)
Reporting Period: 2023
Environmental Metrics
ESG Focus Areas
- Environmental Compliance
- Social Responsibility
- Corporate Governance
Environmental Achievements
- Energy improvement initiatives, primarily related to solar in Milwaukee, WI, Auburn Hills, MI, and Juarez, Mexico, and moves to more energy efficient production capital equipment in Milwaukee, WI to reduce carbon emissions.
- ISO-14001 certified environmental management system
Social Achievements
- Adopted policies that seek to eliminate human trafficking, slavery, child labor etc. from our global supply chain.
- Annually complies and files a Form SD with the Securities and Exchange Commission regarding “Conflict Minerals Disclosure and Report”
Governance Achievements
- Maintains IATF 16949:2016 and ISO 14001 annual certifications
Climate Goals & Targets
Short-term Goals:
- Successfully conclude price-concession negotiations with our key customers by the end of Q2 to achieve between $10 million and $15 million in present program pricing improvement for the fiscal year as well as receive one-time retroactive price adjustment payments totaling between $4 million and $6 million
Environmental Challenges
- Escalating manufacturing input costs for raw materials and purchased materials, higher shipping and Mexican labor wages
- Mexican Peso strengthened against the U.S. Dollar
- Global semiconductor chip shortage
- Geopolitical instability
- Supply chain disruptions
- Inflationary pressures
Mitigation Strategies
- Aggressively seeking pricing recovery from customers
- Salaried staff reduction
- Operational actions to reduce overhead and material costs
- Reduction in fiscal year-end inventory levels
- Quarterly material price adjustments for changes in zinc costs
Supply Chain Management
Responsible Procurement
- Supplier Code of Conduct
Climate-Related Risks & Opportunities
Awards & Recognition
- Automotive News Pace Award for Excellence and Innovation (2018 and 2019)
Reporting Period: 2024
Environmental Metrics
ESG Focus Areas
- Environmental
- Social
- Governance
Environmental Achievements
- Energy improvement initiatives, primarily related to solar in Milwaukee, WI, Auburn Hills, MI, and Juarez, Mexico, and moves to more energy efficient production capital equipment in Milwaukee, WI to reduce carbon emissions.
Social Achievements
- Adopted policies that seek to eliminate human trafficking, slavery, child labor and similar unethical and illegal practices from our global supply chain.
- Annually compile and file a Form SD with the Securities and Exchange Commission regarding “Conflict Minerals Disclosure and Report”
Governance Achievements
- Major governance changes have measurably improved our accountability to shareholders.
Climate Goals & Targets
Environmental Challenges
- Higher commodity, labor, freight and other cost pressure due to elevated inflation.
- Supply chain disruptions in particular with semiconductor chip shortages
- Customer pressure to reduce prices
Mitigation Strategies
- Negotiated material price increases with key suppliers
- Implemented production efficiencies in Mexico
- Customer billings for the reimbursement of engineering development costs
Supply Chain Management
Responsible Procurement
- Supplier Code of Conduct
Climate-Related Risks & Opportunities
Physical Risks
- Natural disasters or extreme weather conditions
Transition Risks
- Volatility in the cost or availability of capital, difficultly obtaining new business or entering into new supplier relationships, a possible loss of market share on our current product portfolio, fines and penalties or difficulty attracting and retaining a skilled workforce.
Awards & Recognition
- Automotive News Pace Award for Excellence and Innovation (2018 and 2019)