CASE STUIDIES

Supporting a German OEM to meet regulatory alignment and source responsibly

Aerial view of white cars aligned at OEM facility

SUMMARY: This case study shows how a German OEM can align procurement systems with the German Supply Chain Act (LkSG) and EU due diligence requirements. It highlights challenges such as unclear internal ownership, limited responsible sourcing experience and complex global supply chains, and explains how training, risk prioritisation and supplier assessments can improve compliance and strengthen supply chain oversight.

Kumi supported an innovative German Original Equipment Manufacturer (OEM) as it electrified its product range of vehicles to help the company align with the LkSG and other relevant regulations, such as the EU Corporate Sustainability Due Diligence and EU Corporate Sustainability Reporting Directives.

The project

We worked with the client to understand its existing procurement processes, supplier relationships, and responsible sourcing accountabilities and with stakeholders to map the different types of supply chains related to the company’s business. Specific challenges we identified include:

The geographic distance between where products are manufactured and the markets they are sold in with two different company cultures and understanding of responsible sourcing expectations.
Overlooking parts of the business in the scope of LkSG.
Lack of internal accountability or ownership over processes in Germany.
A young and inexperienced procurement team with little understanding of responsible sourcing expectations.

Our recommendations

Based on our findings, we developed a simple and easy-to-implement responsible sourcing framework for the company’s European operations.

Commercial teams within the organisation managed the system we developed rather than a standalone responsible sourcing team. Therefore, to support procurement teams without experience in delivering responsible sourcing activities, Kumi delivered in-person training at the company’s headquarters. In these interactive workshops, buyer feedback was used to tweak approaches to meet business objectives and enhance alignment with working methods.

Ongoing advisory calls complemented this training during supplier onboarding. As it turns out, the young team were keen to learn and understand how in their roles they could support the process and have a positive impact.

The outcome

Within the tools provided by us, the risk assessment and prioritisation processes were key. These have led to targeted identification of suppliers who must undergo risk-based assurance assessments. Prior to these, Kumi identified key risks for the country and sector and assessments focused on these risks alone. To date, Kumi has delivered on-site assessments at a trucking company, a port terminal, a customer service centre, and a spare parts supplier.

Our work has ensured the company aligns with LkSG and can demonstrate that it assesses and addresses risks on an ongoing basis. Furthermore, our site-based assessments have directly led to improved conditions in the supply chain on issues including occupational health and safety to grievance mechanisms.

Frequently asked questions

Why are OEMs under increasing sourcing pressure?

OEMs face overlapping regulatory obligations, customer scrutiny, and NGO attention. Supply chain failures quickly become brand risks.
How do you balance responsible sourcing with commercial realities?

Risk‑based prioritisation allows companies to focus where it matters most without disrupting the entire supply chain.
What evidence do regulators expect from OEMs?

Regulators look for documented processes, risk assessments, and evidence that suppliers are being engaged meaningfully.
Can existing supplier systems be reused?

Partially. Most systems require refinement to meet new regulatory expectations.
How early should OEMs engage suppliers?

Early engagement reduces resistance and helps suppliers prepare. Late engagement increases cost and conflict.
Is this relevant beyond Europe?

Yes. Due diligence expectations are global, even where laws are regional.