Hankook takes part in blockchain-based natural rubber traceability and sustainability project for UK

PROJECT TREE is the first attempt to establish natural rubber traceability using blockchain.

Hankook will distribute the tyres manufactured through the project in the UK market.

Part of the tyre sales will be used to fund incentives for collaborating supply chain stakeholders. The project is expected to contribute to Hankook Tire’s CSR goal in fostering sustainability across its value chain.

PROJECT TREE, organised by ITOCHU Corporation, an international trading firm, is the first attempt to establish traceability using the blockchain in the natural rubber industry.

Natural rubber is a primary raw material for tyres. The production of tyres accounts for about 70% of global natural rubber consumption, but approximately 85% of global production relies on smallholders in Southeast Asia, mainly in Thailand and Indonesia. This makes it difficult to keep track of and tackle sustainability issues that arise in the procurement process, including deforestation, poverty, and the violation of human rights.

With the aim of fostering sustainability across the value chain, Hankook has decided to take part in PROJECT TREE, a project designed to track sourcing natural rubber using a blockchain-based traceability system developed by ITOCHU Techno-Solutions Corporation. The project involves PT. Aneka Bumi Pratama, one of the largest Indonesian natural rubber processing companies, and the use of a smartphone app linked to the system which records information such as date and location of transactions.

Through this project, natural rubber produced from raw materials collected outside of conservation areas can be supplied to Hankook. In addition, smallholders without smartphones or bank accounts will be provided with farm tools, fertilisers, and training for better productivity and sustainable practices as well as cash incentives to be paid out under close supervision.

As a strong supporter of PROJECT TREE, Hankook will participate in the project in the UK market in partnership with leading tyre distributor European Tyre Enterprise Ltd. (ETEL) which owns Kwik Fit and Stapletons, its retail and wholesale businesses. ETEL is the largest car servicing and repair company in the UK as well as a trusted partner of Hankook. Part of the tyre sales will be used to fund incentives for the upstream supply chain stakeholders (smallholders, collectors, local dealers) who collaborate to record their transactions and ensure traceability.

PROJECT TREE is expected to contribute to the CSR policy goals of Hankook. The companyestablished a sustainable natural rubber policy in 2018 and is a member of Global Platform for Sustainable Natural Rubber (GPSNR), an international membership driven platform set up to define sustainability for the natural rubber value chain.

Recently, Hankook updated its policy in compliance with the new GSPNR policy across diverse fields such as human rights, environmental protection, and management transparency. In order to further improve smallholders’ living standards, upgrade quality of natural rubber and minimise environmental impact, the tyre maker plans to identify the most suitable cultivation practices and encourage smallholders to receive related training

“As the demand for natural rubber is expected to continue to grow, all stakeholders in the supply chain, including smallholders, tyre makers, and end-users, are expected to fulfil their responsibilities,” says Sooil Lee,

President and CEO of Hankook Tire & Technology. “With sustainability being one of their business priorities, Hankook will definitely take the lead in fostering sustainability in procurement of raw materials to create a better world to live in.”

Yasuhiro Takahashi, General Manager of Logistics & Material Distribution Department at ITOCHU Corporation, comments, “ITOCHU’s medium-term management plan, Brand-new Deal 2023, includes ‘business transformation through the incorporation of consumer needs into products’ and ‘continued contribution to and efforts to achieve the SDGs in its Basic Policies,” adding “ITOCHU will reinforce its natural rubber value chain and hopes to contribute to the sustainability of the entire natural rubber industry through PROJECT TREE.”

About Hankook Tire

Hankook Tire manufactures globally innovative, award-winning radial tyres of proven superior quality for passenger cars, light trucks, SUVs, RVs, trucks, and buses as well as motorsports (circuit racing/rallies).

Aspiring to bring consumers the utmost excellence in product quality, technological excellence and driving satisfaction, Hankook Tire continuously invests in research and development maintaining five R&D centres and eight production facilities around the world. Bespoke tyre solutions for the European markets as well as European Original Equipment according to the requirements of leading premium car manufacturers, are developed in the company’s regional Technical Centre in Hanover/Germany. Production for the European region is taking place in the state-of-the-art manufacturing site in Rácalmás/Hungary which was inaugurated in June 2007 and is continuously being expanded. Currently around 3,000 employees produce up to 19 million tyres a year for passenger cars, SUVs, and light trucks.

Hankook Tire’s European headquarters are located in Neu-Isenburg near Frankfurt am Main in Germany. The manufacturer operates further branches in Czech Republic, France, Germany, Hungary, Italy, the Netherlands, Austria, Poland, Russia, Serbia, Spain, Sweden, Turkey, UK, and Ukraine. Hankook products are sold directly through regional distributors in other local markets. Hankook Tire employs approximately 20,000 people worldwide and are selling their products in over 180 countries. Internationally leading car manufacturers rely on tyres made by Hankook for their original equipment. Approximately 34 percent of the company’s global sales are generated within the European and CIS-Region. Hankook Tire has been represented in the renowned Dow Jones Sustainability Index World (DJSI World) since 2016.

For more information, please visit www.hankooktire.com

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