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Supplier Diversity & Small Business Development
Contributing to Local Economic Development
Supporting Supplier Diversity in the United States
Helping Build Local Economies Worldwide
Contributing to Local Economic Development
To conduct our operations, ChevronTexaco purchases a wide variety of goods and services from external contractors and suppliers. In 2002, ChevronTexaco spent approximately US$18 to $20 billion globally on such goods and services.
ChevronTexaco strives to ensure its supplier base is reflective of its customers, host communities and the markets it serves. We also believe sourcing from diverse, small and locally owned companies makes significant contributions to local economic and human capacity development, and these efforts are part of our commitment to be a valuable member of the communities in which we operate. Therefore, as much as possible and practical, ChevronTexaco seeks to contract with small, locally owned businesses and, in the United States, also from minority- and women-owned businesses.
Supporting Supplier Diversity in the United States
In the United States, ChevronTexaco's Small Business/Supplier Diversity Program works to provide opportunities, contracts and outreach assistance to small and minority- and women-owned businesses.
The program has won numerous awards, including induction into the Women's Business Enterprise National Council's "Elite 8" in 2003. ChevronTexaco is committed to monitoring and reporting progress toward achieving its small business/supplier diversity goals, and it works to continually improve our performance in this area.
Reflecting its commitment to U.S. supplier diversity, over the last six years, ChevronTexaco has spent approximately US$8.6 billion with small, women- and minority-owned business enterprises. In 2002, we met our goal of spending 25 percent of total goods and services spend with small businesses, spending more than US$1.3 billion with small-business suppliers in the United States. We spent approximately US$212 million with women-owned suppliers and nearly US$209 million with minority-owned suppliers, although we fell short of our 5 percent contracting goal for each of those groups, reaching just under 4 percent for each.
Helping Build Local Economies Worldwide
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| Gibson Ola, manager of local business development for ChevronTexaco's Nigeria operation, says the company's role in support of local content is aligned with the goals of the country. |
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In addition to its efforts in the United States, ChevronTexaco has "local content" programs to source from small, locally owned businesses in the communities it operates around the world. These programs are managed at the business unit level.
In addition to buying goods and services from local suppliers, many ChevronTexaco business units offer business planning, skills training and technology transfer programs, and they provide financing - including micro-loans - to help supplier companies develop and expand. We believe our local content efforts are among the most significant and sustainable ways we can contribute to the economic and social development of our host communities.
Highlights of recent local content efforts include:
- Nigeria: Since 1999, Chevron Nigeria Ltd. (CNL) and the Nigerian National Petroleum Corporation (NNPC) have had a formal local content development (LCD) policy promoting the use of qualified indigenous contractors and suppliers. CNL has a dedicated Local Content Development Unit to identify and support local supplier companies, including organizing Local Content fairs to increase awareness and create opportunities for Nigerian companies. In 1997, some 25 percent of company contracts for goods and materials were with Nigerian firms. By 2002, that figure had grown substantially, to 90 percent of contracts, representing 35 percent of CNL's total spending for materials and services going to Nigerian indigenous and joint-venture companies.
- Angola: ChevronTexaco's subsidiary, Cabinda Gulf Oil Co. Ltd., has had dramatic success developing local Angolan businesses. The company has created a team dedicated to local business development, which includes supporting startup businesses in everything from clothing manufacture to fish meal processing. In 2002, the company spent more than $230 million with local suppliers, exceeding its local content goal by more than 275 percent. In total, 268 Angolan-owned businesses supplied materials and services to ChevronTexaco's Angola affiliate in 2002.
- Venezuela: In the company's Hamaca joint venture in Venezuela, ChevronTexaco spent 62 percent of its procurement funds with local suppliers by the end of 2002, exceeding the government's local content goal of 60 percent.
- Kazakhstan: ChevronTexaco's joint venture Tengizchevroil (TCO) met its 37 percent local content goal in 2002.
- South Africa: Caltex Oil (S.A.) established a task force to support the South African government's Black Economic Empowerment (BEE) program. As part of the company's BEE efforts, Caltex gives preferential treatment to Historically Disadvantaged South Africans; provides support and training to small, medium and micro enterprises; and supports companies that actively promote development and skills transfer for their employees. The company increased the total amount it spent on suppliers through the BEE program from 5 percent in 2001 to 23 percent at the end of 2002. For 2003, Caltex SA has a goal to increase BEE purchasing spend to more than 25 percent of total spend on goods and services.
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