supply chain management

In addition to efficiency and operational excellence, Chevron’s approach to managing our supply chain focuses on two elements that are critical to maintaining our commitment to being a good partner:

1. Creating prosperity through local and inclusive economic opportunity: Our supply chain is one of our most powerful tools for creating prosperity in the communities where we operate around the world.
2. Encouraging our partners to meet high standards of safety, social and environmental performance: Our expectations of our contractors and suppliers, as well as the standards to which we hold them, help raise the bar for thousands of companies around the world on issues such as respecting human rights and health, environment and safety practices.

Chevron spent $22 billion in total goods and services in 2022, much of it going to locally owned companies in the countries where we operate – those goods and services are known as local content.

Chevron recognizes that the positive local impact of our supply chain investments can be amplified by the sourcing decisions of our suppliers. We encourage our major international suppliers of goods and services to form partnerships with local businesses and to maximize the purchase of local goods and services. These relationships create an opportunity for the local businesses to gain access to new technology, to bring their processes up to international standards and to train their people on the latest industry practices.

In Kazakhstan, the Chevron-led Tengizchevroil (TCO) joint-venture works closely with its major contractors and suppliers to encourage an increased focus on local content to enhance local impact and economic contribution to the Republic of Kazakhstan. TCO’s suppliers have recorded several significant achievements including the investment in and opening of a facility in Aktau by an international oil country tubular goods manufacturer that supplies threaded pipe to TCO; the opening of a state-of-the-art, large-scale greenhouse in Kulsary by an international catering and facility management company that provides vegetables to TCO’s canteens and the surrounding communities; and the completion of a successful bid by several Kazakhstani companies to provide millions of dollars in sulfur railcar transportation.

TCO has also engaged Kazakhstani entities to participate in engineering, procurement and fabrication services for the Future Growth Project–Wellhead Pressure Management Project. Since the project commenced, approximately $8.4 billion has been spent on Kazakhstani content; more than 2,200 Kazakhstani companies have been pre-screened and more than 1,200 have been pre-qualified.

Chevron also seeks to build and maintain a supply chain that reflects how deeply we value diversity. In 2022, our Supplier Diversity Governance Board endorsed new strategies to increase spending with diverse businesses. We aim to diversify our supply chain by expanding our investment in technology and industry partnerships.

We expect our suppliers and contractors to treat their employees and to interact with communities in ways that respect human rights and adhere to the spirit and intent of our Human Rights Policy.

Chevron requires that our key suppliers adhere to all domestic laws and expects them to adhere to applicable international principles as set out in the United Nations Guiding Principles on Business and Human Rights and the International Labour Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work. On an annual basis, we communicate directly with the executive leadership of several hundred suppliers about the importance of respecting human rights.

Contractors are a critical part of the Chevron workforce.

Our Contractor Operational Excellence Management (COEM) process establishes clear accountabilities, promotes active partnership and provides a consistent approach to help prevent serious injuries and fatalities. Best practices and early-adopter experiences are shared through our COEM Community of Practice. In addition, a complementary digital application, eCOEM, enables Operational Excellence (OE) diligence during each phase of the contracting lifecycle.