RESPONSIBLE Tesla is committed to only sourcing responsibly produced materials. SOURCING The Tesla Supplier Code of Conduct (Code) and our Human Rights and Conflict Minerals Policy outline our expectations of all suppliers and partners who work with us. Tesla is committed to making working conditions in our supply chain safe and humane, ensuring that workers are treated with respect and dignity and that manufacturing processes are environmentally responsible. Tesla suppliers are required to provide evidence of management systems that ensure social, environmental and sustainability best practices in their own operations, as well as to demonstrate a commitment to responsible sourcing into their supply chains. Our complex supply chain is a unique hybrid of the traditional automotive and high-tech industries and encompasses suppliers from around the world. Many of our Tier 1 suppliers (i.e. direct suppliers) do not purchase all of their raw materials directly and instead obtain them from their suppliers and sub-suppliers. Therefore, reliably determining the origin is a difficult task, but the due diligence practices required of our suppliers adds transparency to help us and our suppliers adhere to the responsible sourcing principles of our Code. Our Tier 1 suppliers are required to register and complete the domestic and international material compliance requirements in the International Material Data System (IMDS) to meet EU and other international material and environmental related regulations. This requirement is mandated for all suppliers who supply their products or raw materials to us as part of our production-parts approval process. Tesla, along with our partners and independent third parties, conducts audits to observe these principles in action. If there is a reasonable basis to believe a supplier partner is in violation of the Code, Tesla will transition away from that relationship unless the violation is cured in a satisfactory manner. 3032
Tesla Impact Report | 2019 Page 31 Page 33