CSO Insights: How tire giant Michelin manages sustainability across a global supply chain

Lindsey Hall I'm Lindsey Hall.

And I'm Esther Wheeldon.

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Welcome to All Things Sustainable, a podcast from S and P Global. As your hosts, we'll dive into all the sustainability topics that are reshaping the business world.

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Join us every Friday for in depth analysis and interviews with leaders from around the globe. Together, we'll break down big sustainability headlines and cut through the jargon. Over 100 years ago, a tire company launched a series of guidebooks to encourage people to get on the road and drive more, thus boosting tire sales. That company is the Michelin Group and today you may know the Michelin Guide for awarding prestigious Michelin stars to some of the world's best restaurants. France based Michelin Group also remains one of the world's largest tire manufacturers. And in today's episode, we're talking to the company's Chief Sustainability Officer to understand how Michelin is making its tires and the travel they enable more sustainable.

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Today's episode is the latest in a recurring series of this podcast that we're calling CSO Insights. In the CSO Insights series, we're talking to chief Sustainability officers around the world and across industries about how they're navigating the evolving sustainability landscape. The sustainability space has been through an extraordinary transformation in recent years and CSOs have a front row seat to this evolution. We'll include a link in our show notes if you'd like to listen to other episodes in this series.

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Now for some context on the transportation sector. Private cars and vans were responsible for more than 25% of global oil use and around 10% of global energy related carbon dioxide emissions in 2023. That's according to the International Energy Agency. And tires are a crucial component of vehicle fuel efficiency. By some estimates, there were about 1.6 billion cars and trucks on the road globally in 2025. And that's not counting the many motorcycles, mopeds and other vehicles out there. In other words, there are a lot of tires on the road. To learn how Michelin is approaching sustainability, I spoke with Antoine Suttonet. Antoine explains how the company seeks to reduce its reliance on fossil fuels, including through increased use of recycled and renewable materials in tires. You'll also hear him talk about another key component of tires, which is natural rubber and is largely produced by very small farms or small holders. He describes how the company is working with those farms in supply chain to drive sustainable practices. And he talks about the company's biodiversity strategy. Okay, here's Antoine, who starts by describing his background.

1:30

I'm the Chief Sustainability Officer for The mission group and I'm working for Michelin for the last 12 years and previously I used to work for the university as a teacher, international law mainly. And then I used to be a diplomat for the French Ministry for NFLs before joining Michelin on mainly, you know, as their public affairs function in France, in Thailand and in Montreal, Canada. So I'm in charge of everything related to what we call esg, environmental, social and governance issues, from climate, biodiversity to human rights, diversity, equity and inclusion. So the scope is very comprehensive. I think a lot of people know Michelin thanks to tyres, well known. But what you should know as a listener, I think is, I don't know that you maybe realize that Michelin is not only about tires and it's also thanks to our expertise in high tech materials. And actually what we would like to accomplish for the next 20 to 30 years is also to expand our knowledge on materials to serve other areas, not only mobility, I mean, but also new domains such as aerospace, healthcare. Thanks to this expertise on composite solutions and materials. In terms of employees, we are close to 130,000 employees all around the world with a geography which is mainly in Europe, but also in the US. And maybe you don't know this figure, but almost 40% of our turnover is in the US and so we are very, let's say in terms of footprint, very large in the us, in Canada, also in Nova Scotia, but we have also a strong presence in Asia, especially in Southeast Asia, in Thailand with five factories and also in China. So three main geographies, Europe, North America, Asia and also more, let's say, marginal presence in South America and also Central America, of course.

2:36

Great, thank you. So, big picture set the scene for us. What are the biggest sustainability challenges and opportunities for both your company and the sector you operate in?

4:38

Yeah, Michelanger, the European company, and we had to follow what we call the Corporate Sustainability Reporting Directive. And that was a great channel to demonstrate or to showcase our sustainability challenges. But also, you know, risk and opportunities. What can be the contribution of Mishna to a more sustainable world? And if you have a look at what we have done, what we call this exercise, a double materiality matrix. And if you have a look at what is the impact of Mishnah on the society and the environment. So where we may have an impact, if you have a look at the environmental topics, it's mainly about climate, just maybe to give you some numbers, but when you are using a tire, the usage phase of a tire is the most important in terms of impact. Globally speaking, Michelin is around 120 million tons of CO2 per year, just the usage phase of a tire, compared to our scope one and two, which is only less than 2 million ton of CO2. So you can see the big gap between scope one and two and what we call scope three, the usage of our tires, you and me, when we are driving, so clearly, in terms of sustainability, climate change, climate mitigation for the usage of our tires, of our products is absolutely critical. Still, on the environmental topics, we are also concentrating our efforts about what we call resources depletion. And as you can imagine, and that's true for the mobility industry at large, we are still very dependent to fossil resources, including our tires. I mean, if you have a look at all the components of a tire, it's almost 400 materials. We are still dependent on fossil resources. So clearly what we can do in terms of to increase circularity, for instance, is absolutely key. And another topic that may have an interest for us collectively and for the audience is about particles, because we are emitting particles when you are driving a tire, we are also emitting particles with a potential impact. But let me also give you, let's say, a perspective about social topics, because sometimes when we speak about sustainability, we are focusing only on environmental topics. But also for Michelin, what is very key for us is social cohesion. What we can call a social fabric, how to be able to maintain the capacity of our employees to live a proper life. That's why, for instance, we decided to promote a living wage for all our employees in every part of the world. So social fabric, the way our employees are considered within the company, is absolutely critical. We can call it also a kind of social innovation. So we want to take care about our employees. So as you can see, a range of topics from climate to resources depletion, from human rights to social fabric within our employees.

4:48

Antoine went on to describe how Michelin is also working to promote social equity as well as other sustainable practices for the about 1 million natural rubber farmers in its supply chain. A note on several terms. You'll hear him Comex, which is shorthand for executive committee, and ceg, which refers to group executive committee. Antoine just talked about Scope one emissions, and those come from a company's operations. He also mentioned scope 2 emissions. Those are primarily derived from purchased energy. And there's also Scope three emissions, which occur up and down the company's supply chain, as well as when a customer uses the products. You'll also hear the term oem or original equipment manufacturer. And in this interview, Antoine uses the term OEM to refer to car manufacturers broadly. Antoine also talks about rolling resistance, which can affect how much fuel a vehicle needs to run, thus impacting total emissions. Rolling resistance refers to the resistance a tire experiences as the vehicle moves. Lastly, Antoine mentions butadiene or butadiene, that's a gas that's typically produced from fossil fuels and is used to make synthetic rubber for tires. The synthetic rubber makes up about 20% of a Michelin tire. And as you'll hear today, the company has a project in France for producing an ethanol derived butadiene from plant biomass instead of fossil fuels. Okay, back to the interview.

7:51

So, as you can imagine, we are producing tires. So it means that we are very dependent on our value chain and especially on natural rubber. So it means that we have a specific responsibility on these value chains. So we are launching many projects to promote and to provide a more resilient revenue to all the farmers that they are living in, especially in Southeast Asia and Western Africa.

9:12

Now, before I go on, can you explain to me how scope three, the usage of tires, what causes the emissions there?

9:39

Yeah, no, fine. And it's a very interesting question. On the scope three, you know, our tires are the only product which is in contact with the road so fast. So it means that when you are driving, depending if you are driving a car or a truck, but let's say you are driving a car, almost 20% of your fuel is linked to the rolling resistance of a tire. So it means that the tire has a huge contribution to energy efficiency and to the usage that you have on your fossil consumption. So that's why it's so important. But it means also, Esther, that for the scope 3 related to the usage of our tires, it's not only a responsibility on Michelin, let's say it's a shared responsibility to manufacturers of tyre, but also to OEMs and to you and me, to the driver. Because it depends on your behavior on the road, depending on how do you behave in terms of driving. But this is the most important part in terms of CO2 emissions.

9:47

So what are your company's targets regarding emissions? Scope 1, 2 and do you have anything on scope 3 that you're aiming

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for scope 1 and scope 2? Actually, as many companies we decided to have SBTI targets for science based target initiative on climate. So for scope 1 and 2, so we have new SBTI targets validated in June 2025. We are aiming to reduce by 47% our CO2 scope 1 and 2 emissions by 2030. But also we decided to reduce our CO2 emissions for other parts of the scope 3 related to the purchase of raw materials upstream energy. And this is a reduction by 28% by 2030 compared to 2019. So we have specific targets and commitments validated by SBTI for scope one and two, and for scope three, what we called essential purchase of raw materials, logistics and energy. Then on the scope 3 related to the usage part, we have a specific target which is linked to the rolling resistance of our tires. Once again, it's about energy efficiency of your vehicles. So we have a target to have plus 10% of rolling resistance by 2030, but it's not a validated internationally target. But we have an internal target on the scope 3 related to the usage phase of our tires.

11:01

So you've mentioned some of Michelin's approach to sustainability, but what are the other aspects or the bigger picture approach that you take?

12:24

Yeah, actually how we are orchestrating our ESG performance at Mishnah, it starts always with leadership. And the key is that we are able to involve our ceg, our COMEX members, and starting with our CEO and Florent Menego, our CEO is deeply convinced by the necessity to tackle sustainability at large. And we embedded a strategy called a 3P approach, which the key of this approach is to combine a kind of equilibrium between people, profit and planet. So we should be able to find the right actions with this balance between people, profit and planet. So it starts with leadership. First comment, Second comment is about how we are able to work, concretely speaking on the different topics I was mentioning, climate. Let's take that example, how we are doing that at Mishnow. As you can imagine, we are an engineering company. We have many, many people working on research and development. But we organized ourselves with governance mechanism and we decided to set up, I think four years ago, what we called an environmental governance with two COMEX members with a capacity to decide on behalf of the CEO on many key topics for our trajectory on sustainability, for instance, we decided two years ago to set up an internal carbon price for all our decisions when it comes to our manufacturing facilities, for instance, some projects to electrify our processes, for instance. So we decided to set up an internal carbon price and we decided to fix this price at €200. So to take a proper decision, taking into account people, profit and planet. So we have all the key mechanisms internally able to take the right decisions on all the key topics. We have this environmental governance with specific committees below on climate, on biodiversity, on pollution, on circular economy. So we have many, many committees with all the departments Involved, able to orchestrate, to animate what we need to do all along the year.

12:32

Great, thank you. I was wondering if we could dig into some of the areas you mentioned. Let's start off with the circularity. I saw that one of your stated goals is to reach full circularity of tires by 2050. That seems like a pretty big goal. How do you plan to achieve that target and what are some of the steps you're taking currently?

14:50

Yeah, I think this is the main change of paradigma, if I may say, because you're right. We have this objective to reach full circularity of our tires and what it means concretely. It's about our capacity to integrate recycled and renewable materials into a tire. I mentioned just that very quickly at the beginning of our discussion. But I think it's very important to understand that in a tire you can find more than 400 materials inside. But if you have a look at those materials, we are very dependent on, on fossil resources. Just to give you some examples, natural rubber is only 25% of attire as an average. But you can find also in attire, synthetic rubber. You can find also fillers, you can find textile, metals. So we need to change and to be able to have more and more recycled and renewable materials into a tire. So what we decided to do is first to set up an ambition, you can say full circularity of tires. We decided to phrase it also a little bit differently. We decided to have an ambition by 2050 to have 100% of recycled or renewable materials rate in a tire. And after this ambition for 2050, we decided to set up to fix a target by 2030 to reach 40% of recycled and renewable materials in a tire. You can think that it's just numbers, but it's a huge, huge effort just to find recycled materials. Today, by 2025, we are at 32% of recycled and renewable materials. But we need to do a lot of things with an ecosystem, and on that part, circularity and materials, we cannot act alone and we need to work with an ecosystem. That's why we decided to create a specific department within Michelin three or four years ago, dedicated to sustainable materials. And it's a huge department place around 20 people. And these people, these 20 employees are dedicated to specific collaboration programs with other partners, with other companies to create or to find another way, or to find circular materials. Let me maybe give you some examples. I mentioned that we have around, let's say, 20% of synthetic rubber in our product. Actually, we decided eight years ago to create a specific production of what we called biobutadien and butadiene, you know, normally come from petrochemicals resources. And we decided to launch a project with the French government and other academics to launch a production of biobutadiene and basically ethanol derived from biomass to create, to produce biobutadiene. And this part, biobutadiene instead of butadiene is very difficult project and it takes a long time. We are speaking of origin of time of around, let's say 10 years. So it takes time. We need other partners to promote this circularity, but it's an absolute objective for Michelin. And this is the only way to change our relationship with nature. Another example of a recycling project is a partnership that we established with a Swedish company called enviro in 2020. And basically the idea is to develop and mass produce a pyrrolysis technology which is capable of recovering high quality products like carbon black pyrolysis, oil, steel and gas, which can be then reincorporated into the production cycle of various industries, including the tire industry. And we decided to set up a factory with a joint venture with another partner, which is ANTA Infrastructure Partner Investment, so investment fund. And we are in the process of building a factory in Sweden with the capacity to recycle 35,000 tons a year. So we are building that plant as of today with this Swedish company and this investment fund, but once again a very, very strong effort. And that needs time to have all the key partners on board with the right timing.

15:09

So as a global company, how do you balance the current and shifting geopolitical landscape against your sustainability goals?

19:49

It's a very pertinent question in this world, let's say, in this fragmented world, as you have seen, I think, and the audience also, I mean, we are facing headwinds on sustainability, globally speaking. There is, depending on some countries, how we are navigating in this fragmented world. For us, Michelin, what is key is to be local, for local to local. And I didn't mention that when I presented the company, but what is key is that we are producing tires, for instance, in the U.S. we have 14 factories in the U.S. we are producing tires in the U.S. for the U.S. market, we are producing tires in Europe, for the European market. So from that perspective, we are, let's say, less dependent on the international trade change or geopolitical changes as well. So yeah, we are very local to local. And we decided a long time ago to also to have people from the countries growing within the company, able to head our activities in every countries and regions. Where we have a factory.

19:58

So making sure your domestic production is locked down for each region.

21:06

Yeah, exactly. But the only thing is about precisely the materials that we are using into our tires. And from that perspective, you cannot grow natural rubber in France or even in the U.S. okay? And natural rubber is coming from the tropical zones. So it's mainly Thailand, Indonesia, Sri Lanka, India, Western Africa, a little bit Brazil. But on that part, I mean, we have no choice. So we are quite dependent on natural rubber.

21:10

For instance, I asked Antoine to dig into natural rubber. What are the challenges and what are the opportunities?

21:40

This is, I think, the best example of sustainability for our industry. Once again, we have almost 1 million farmers, small holders. We have an holding company based in Singapore, purchasing natural rubber for the group at large. And what is key to understand is that we have a specific responsibility within this value chain, thanks to these smallholders. And it is a very fragmented and very complex value chain. Actually, just to give you some numbers, as an average to produce natural rubber, it's an average for the farm is around 3 hectares, 3 to 4 hectares. So it's very, very small smallholders compared to cocoa or to coffee, where you have cooperatives and unions. In 2017, we decided to launch an application called Rubberway to better understand the situation for the farmers on the ground. And we sent a very simple questionnaire asking questions around, what are your practices in terms of agronomy? What are your working hours? Are you using pesticide? So many questions around 60 questions around environmental topics and social issues. Okay? And that was great because a lot of farmers were able to answer this questionnaire. And then that was a statistic, a tool in a way, from a statistical point of view, to better understand the situation for the farmers, jurisdiction by jurisdiction, okay? And when we understood the difficulties, the constraints of smallholders, we decided to launch capacity building project with those farmers. We decided to launch projects with car manufacturers, with development agencies such as the World bank, to some farmers. Let me give you a concrete example. We were able, through rubber way, this application, to focus on a specific province in Sumatra, Indonesia, a specific province called Jambi. And in this province, we were able to identify some villages with around 4,000 farmers. And we decided to launch a project with a technical provider, in that case called csapa, an ngo, able to provide training to farmers with also technical expertise from Mishla. And we launched a project for two years with training onwards, training on best practices from an agronomic point of view, best practices in terms of intermediate cropping, in order for the farmers to have a resilient revenue, okay. Not to be too dependent to the natural rubber. Also to promote, let's say, a social impact, especially for the women on the ground. So as you can see, a lot of impact both on environmental issues, but also on social topics. And by 2025 we were able to reach around 10,000 farmers and their families in Thailand, in Indonesia, in Sri Lanka, in Brazil or in Ivory Coast. And to be completely transparent with you, we are working to how to scale up these kind of projects to be able to reach more and more families at the end. So this is, I think, one of the most exciting sustainability challenges that we will have to face for the years to come.

21:46

Now, you've mentioned that biodiversity is part of your company's focus. Can you talk about how you're thinking about that and addressing that?

25:02

Actually, biodiversity is a huge topic for Mishla, as I mentioned, it's mainly if you have a look at the dependencies and impact of Mishla to the ecosystemic services. It's of course linked to our value chain once again to natural rubber. So we are providing, we are promoting biodiversity within our assets. And actually we have our own plantations, ester mainly in Indonesia, Sumatra and Borneo. And we have also a reserve in Brazil, in Bahia. And our commitment is to produce sustainable natural rubber. And we are also promoting biodiversity through conservation and restoration actions. And for instance, in Indonesia we have a commitment to restore 15,000 hectares by 2040. But we are also working and we have a commitment called act for Nature, which is an international commitment on biodiversity. And we are working also on biodiversity through our factories, Esther, for our industrial site. And actually we decided to have a commitment on a biodiversity management plan. We have now 67 factories with a specific biodiversity management plan all around the world. And we have also a specific commitment around the reduction of pesticide for the green spaces around our site. So we are working both on the land use and on our sites industrial site, but mainly on the sustainable natural

25:10

value chain for the biodiversity management plan of factories. You mentioned pesticides for green spaces. What might be some other things they would do?

26:41

Well, they are doing a lot of things and it's not only about biodiversity. They are working on how to better use water, for instance. It's biodiversity. It's a very local topic, so it depends on the site and is very interlinked with other topics such as pollution and water. So just to give you the example of our research and development site in the US they are working to better understand the use of water within their operations, not only in terms of withdrawals but in terms of water consumption and how we can promote a better understanding of of the use of water in the watershed in order to sustainably use this resource. So it's also something which is absolutely needed and is linked to biodiversity. It's a topic on which you need to work with your local stakeholders.

26:49

Now we've talked about what your company is doing, but I'm curious to learn a little bit more about what sustainability related issues you are watching closely this year.

27:41

Actually, I was mentioning water. I think it's one of the key topics that I am following very closely. I'm deeply convinced that it's one of the key issue that we have to be very cautious about. There are many topics around water with the question of quantity. You know, the quantity of water that we are using in our production processes. And let's say Michelin is not a huge player in this field. We are consuming around 20 million mid cube all around the world in a year. So it's more or less the consumption of a city such as Lyon in France. So we are not a huge player in terms of water consumption. But I'm deeply convinced that we need to follow the topic not only in terms of quantity but also in terms of quality. What about the pollution of water, how we can sustainably use this resource, but also what is the impact of water for our suppliers? We had some shortages. We faced some shortages in Mexico. This year we decided to launch a pilot project on sustainable water use in the province of Guanarato in Mexico. Especially because it's a region where the hydric stress is very high. So we decided to work with the local stakeholders, with the government of Mexico to see how we can better understand the hydrological status of the watershed and how we can use in a better way water as a resource. It's just one example. The other example I would like to mention is biodiversity. We want to accelerate our actions through smallholders. So we are working very closely with some key actors in the finance system such as the World bank, the Asian Development bank and other agencies to see how we can scale up our actions for our smallholders.

27:49

Earlier in the interview, Anton noted that the company aims to balance people, profit and planet. So how is the company approaching the profit side of this equation? I asked him.

29:34

This is the most challenging one. Why? Because when you are buying a tire, I'm not sure that you have a concern on sustainability. You are not buying a tire because it's more sustainable in terms of fuel consumption. You are buying a tire because it's maybe safer in terms of safety is better. In terms of the range of long lasting performance is a great asset for a tire. But let's be honest, it's very difficult today to valorize our performance in terms of sustainability for our clients. But it's precisely where we would like to go. Because at the end, I mean, we are doing a lot of things I mentioned on climate, on biodiversity, on particles as well on recycled and renewable materials. But at the end, if you and me, if our clients have no willingness to pay for sustainability is an issue. So precisely we are working on it to find the way to be seen as a leader on this topic, such as rolling resistance. Such as, for instance, I didn't mention particles, I mentioned the fact that with a tire you are emitting particles. Tire, road and wear particles with a potential impact. Actually, we are emitting far less particles compared to our premium competitors. And we have a lot of studies demonstrating that we are emitting less particles than our competitors. But today it's very difficult to translate this sustainability performance into the price of our product. So one of our challenges, to make that balance between profit and planet in order to be able to promote the right value of our product compared to our competitors. Because let's be fair, we are facing today also a very difficult situation from an economic standpoint. I mean, we are facing a lot of unfair competition from Asian tires producers. We have also a rise of energy cost in Europe. So we are facing many issues. So we will need in the short run to be able to value our products. And sustainability is a great asset to differentiate Michelin compared to our competitors.

29:43

Great. Thank you so much for taking the time to be on the podcast.

31:59

You're welcome. It was a great pleasure for me as well.

32:02

Today we heard how Michelin's goal is to balance people, profit and planet. And this is something we've been hearing consistently from guests in recent months, which is the need to balance sustainability objectives alongside profitability. Antoine also described how Michelin is investing in a circular economy to reduce its reliance on virgin materials and fossil fuels. And he talked about how the company cannot achieve its sustainability goals alone.

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And please stay tuned as we continue exploring how companies are approaching these and other sustainability challenges in future episodes. Thanks for tuning in to this episode of All Things Sustainable. If you liked what you heard, please subscribe, share and leave us a review wherever you get your podcasts and a

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special thanks to our agency partner, The199. See you next time.

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Sa.

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