Our program focuses on integrating sustainability into the procurement process, encompassing supplier selection, risk assessment, continuous improvement, and capacity building. We strive to collaborate with businesses sharing our commitment to sustainability, strategically deploying procurement spend to meet operational requirements but also promoting fairness and competition.
We seek opportunities which enable us to reduce our environmental impact while focusing on safety, positive social change, transparency, and active supplier engagement.
The Sustainable Procurement Program strategy is developed by Procurement, with guidance and approval of Sustainability, Indigenous Relations, Legal, Safety, Environment as well as operational functions. Executives from these groups convene quarterly as part of the Sustainable Procurement Steering Committee to review program updates and key performance metrics. Selected metrics, including Indigenous spend and diverse supplier spend are escalated to CN’s Governance and Sustainability (GS) Committee of the Board enabling oversight from CN’s Board of Directors. Additionally, CN’s Indigenous Reconciliation Action Plan (IRAP), including the economic reconciliation pillar, are directly overseen by the Board enabling visibility on CN’s Indigenous Procurement program. For example, the reporting of CN’s Indigenous spend in relation to the target set out in the IRAP.
We hold our suppliers to the same high standards we uphold ourselves. Our Supplier Code of Conduct is an extension of our Code of Business Conduct and Human Rights Policy, which outlines our commitment to trust, integrity, labor and human rights, environment, and business ethics. These guidelines are mandatory and CN will only contract with suppliers that accept the Supplier Code. The Code is referenced as a clause in all supplier contracts, and suppliers are regularly informed of any updates or changes. We continue to develop practices to ensure sustainability requirements highlighted in the Supplier Code are met. As detailed below, we screen potential suppliers on their sustainability practices during the Request for Proposal (RFP) process, review supplier sustainability risks leveraging a third-party cloud-solution platform, EcoVadis, and gain further insights during supplier performance reviews and risk assessment audits. Additionally, suppliers are expected to maintain documentation to demonstrate their compliance with the Supplier Code and demonstrate compliance upon request whether it be through site visits or inspections by CN personnel or designated agents.
CN prioritizes supplier safety and security, which is why eRailSafe is mandated for contractors and sub-contractors working for CN. This program ensures that contractors possess the required credentials and adhere to CN's safety standards when working on our property. eRailSafe is a prerequisite for CN contractors and their sub-contractors who operate on company premises, access sensitive documents, and utilize CN's I&T infrastructure.
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Our Request for Proposal (RFP) process considers weighted evaluation criteria on sustainability that influences the decision to award business. To identify suppliers with strong sustainability practices, proponents, including both current and potential suppliers, are expected to provide their response and supporting documentation highlighting their sustainability practices. This includes environmental management, health and safety, human rights, inclusion practices, accessible procurement considerations and their sustainable procurement practices within their own supply chains. Significant sustainability risks material to our business, but also sector-specific and commodity-specific are considered. Certain categories of spend tied to CN’s decarbonization journey (i.e., Fuel, and Locomotives) contain in-depth sustainability assessment criteria and hold a significant weight in the overall RFP evaluation. Screening our suppliers on sustainability provides a means to determine areas where there may be actual or potential sustainability risks and opportunities within our supply chain.
To assess ongoing sustainability performance of our suppliers, since 2021, we have partnered with a third-party cloud-solution platform, EcoVadis, enabling us to help identify, manage, and monitor high sustainability risk and opportunity suppliers. Currently, our scope is to onboard critical and high spend suppliers (greater than $10M annual spend) and request they respond to a sustainability assessment of CN’s choosing or another equivalent sustainability assessment, which is a requirement outlined in the supplier contracts and that must be met within a set timeframe. We use the responses, which consider country and industry specific risks, to monitor our suppliers’ sustainability performance and during performance reviews to discuss any improvement areas or corrective actions required based on the results of our risk framework. Additionally, suppliers that do not meet a minimum threshold are sent a corrective action request requiring performance improvement actions be taken within their next assessment period. This improvement request, along with re-assessment requests, are discussed during the sustainability portion of recurrent supplier performance reviews. Through the assessment, suppliers have access to peer benchmarks to help them compare their performance within relative industries.
We strive to ensure that suppliers are guided by the same core safety value that guides us. We partner with our suppliers to help them achieve the same safety standards we expect of ourselves. Risk can be introduced by our contractors while working on-site at our yards and facilities and therefore, we have established a risk matrix to identify contractor requirements based on applicable safety standards. Since 2020, we have engaged a third-party cloud-solution platform, ISNetworld, to facilitate the mandatory reporting of safety statistics and the submission of documentation from our in-scope contractors. Contractors must meet these requirements and maintain an acceptable score on the platform to perform work on-site for CN, as detailed in their supplier contract. Should a contractor fail to comply with this requirement, they are given 30 days to act and become compliant. If they go beyond this 30-day period, they are informed to cease on site work until a resolution is established. A temporary exception process requiring the implementation of a safety working plan exists for critical contractors that have a direct impact on CN operations. This is an exceptional process that requires multiple sign off’s including that of CN Safety and the head of the function responsible for the contractor.
As we continue to build our existing human rights and supply chain due diligence practices, we are taking action to identify and mitigate risks associated with forced labor and child labor. These actions include undertaking a risk assessment for CN’s top ~70% spend (roughly top 100 Tier 1 suppliers) to help us begin to assess the specific risks of forced labor and child labor in our supply chains. This risk assessment results in a score for suppliers using weighted inputs of individual risk components based on country of operations, industry, products and adverse media reports. Further details and results of this assessment can be found in CN’s Fighting Against Forced Labour And Child Labour In Supply Chains - 2025 Annual Report.
To strengthen our supply chain due diligence practices, CN has implemented a sanctions screening process leveraging a third-party cloud solution platform, Exiger, to help identify and manage risks associated with global sanctions. In 2024, we conducted an initial review of all ~11,500 suppliers and ~8,000 customers, including those linked to Autoport and TransX, to assess CN’s potential exposure to sanctioned entities and continue to perform this exercise on an annual basis. This screening focuses on global sanctions lists and supports CN’s efforts to uphold ethical and compliant business relationships.
The purpose of the supplier risk assessment audit is to ensure visibility of suppliers that have a significant impact to CN, and to provide ongoing monitoring of potential risk. Specifically, audits are performed to examine the policies suppliers have in place as well as perform a walkthrough of processes to ensure alignment with all applicable requirements and guidelines, including those listed in CN’s Supplier Code of Conduct. The audit format is designed to assess quality, operational, information and legal, reputational, human and ESG risks (i.e., human rights, safety, decarbonization, environment, etc.). Critical suppliers are scheduled to undergo risk assessment audits either on-site or by desktop within a three-year period. New suppliers may be subject to an audit as part of onboarding. Risk assessment audits are also completed if a risk has been raised for any supplier. For any deficiencies identified, Corrective Action Requests (CARs) are issued to the suppliers requesting them to perform root cause analysis and implement corrective actions. Progress of the CARs are monitored and tracked until the issue is resolved. Key metrics are reviewed quarterly with the Procurement leadership team.
Our sustainable procurement program is a cross-functional initiative driven by our Procurement and Supply Management team and is overseen by CN’s Vice-President of Procurement and Supply Management, reporting directly to CN’s Chief Financial Officer, with support from executive management. To effectively execute our program, we engage our internal teams across the Company through one-on-one meetings as well as providing training sessions on our various sustainable procurement initiatives, including general sustainable procurement onboarding, supplier sustainability performance discussions, contractor safety and Indigenous procurement approaches. The goal of our internal engagement is to raise awareness, build knowledge, and enable successful implementation of our program. In 2025, 97% of Procurement and Supply Management staff participated in sustainable procurement training.
By embedding sustainability principles, fostering supplier collaboration, and promoting inclusion, we aim to create a more sustainable and inclusive supply chain.
In 2023, we extended our EcoConnexions Partnership Program to our suppliers to recognize their efforts in embedding sustainability within their operations and supply chains, with a particular focus on climate action, resource efficiency and biodiversity.
To enable further collaboration and understanding of risks within the supply chain, we hold ESG performance discussions as part of recurring supplier reviews with a phased roll out to our Significant Tier 1 Suppliers. Through these discussions, we set expectations on CN’s sustainable procurement program and requirements, provide guidance to suppliers on improvement areas and learn more about our suppliers' sustainability journeys.
Supplier Updates Consistent communication with our suppliers by e-mail, supplier portal and meetings to provide updates on key initiatives and discuss sustainable procurement.
Supplier Inclusion Promote an inclusive supply chain & procurement process by supporting traditionally underrepresented suppliers.
Indigenous Business Opportunities Build relationships and identify opportunities with Indigenous-owned businesses in communities where we operate.
For more information about our Sustainable Procurement Program and CN supplier classification, please contact our Procurement team. For more information on our Indigenous partnership program please visit our Indigenous Relations page. CONTACT US INDIGENOUS RELATIONS