Communicating sustainability in the supply chain: Five top tips

The sustainability of modern supply chains is under scrutiny from all angles, with consumers, manufacturers, processors and farmers all keen to ensure affordability and profitability. With such tensions in the chain, how can ‘the middle man’ deliver on demands of global customers and mobilise staff in the changing landscape of ever-higher stakeholder expectations?

1 – Don’t over-promise

It’s very easy to get carried away and over-promise, but sustainability targets should never be divorced from your basic business principles. Road-test promises internally before they are communicated to the outside world – especially when they are made within customer partnerships.

2 – Don’t alienate colleagues

No sustainability targets can be achieved by the sustainability team alone. We need our colleagues to deliver on our promises. However, sustainability has developed its own jargon-filled language which tends to alienate those working outside of it – take the term ‘capacity building’. While it means giving people the necessary knowledge and skills to shape their own development, I’ve had numerous instances where colleagues thought we were talking about building extra factory processing volume or similar!

3 – Don’t doubt yourself

There is a growing pressure from customers, shareholders and NGOs to comply with regulated sustainability schemes. While external certification bodies, such as FairTrade and Rainforest Alliance, act as third party auditors and provide reassurance to customers, it is often true that no-one knows your business better than yourself. We believe that in addition to third party certification, there is a role for companies to develop verification schemes that are independently audited.

4 – Don’t collect data for data’s sake

Don’t get obsessed by the metrics without knowing why you’re collecting them or how to usefully act upon them. Focus on impact, insight, outcomes and improvement, not the glory of numbers.

5 – Don’t go it alone

Companies don’t operate in isolation. There is a paradigm shift towards collaboration, and the nature of where and how to compete is being re-framed. The CEO of a global telecoms company once said that his biggest business regret was wasting over a decade and billions of pounds’ investment before he discussed sharing infrastructure such as masts with his competitors.

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Sustainability Drives Supply Chain Professionals to Learn New Finance and Accounting Concepts

At JDA’s Focus event, Rich Beck, the Sr. Vice President of Global Operations at PepsiCo, gave the keynote on the second day of the conference. Rich said that their supply chain goals included “digitizing the value chain” (JDA was a key solution provider in this area) and “sustainability.”

I’ve been covering supply chain management for twenty years. Last year, I spent 20 percent of my time on the road. And I hear many, many supply chain speeches. I can count on a few fingers of one hand the number of supply chain executives I have heard say sustainability was one of their major goals.

That will change. 72% of the companies included in The S&P 500 Index® publish sustainability reports, up from just under 20% in 2011. Over time, companies’ sustainability efforts become more mature and corporate sustainability goals filter down and become key supply chain goals as well. And these are not incompatible goals. At PepsiCo supply chain sustainability includes “reducing their inputs while optimizing outputs;” but really, that has always have been a goal for supply chain organizations.

The CDP, formerly the Carbon Disclosure Project, is the best known of the organizations that are helping (or pressuring, depending on your point of view), companies to do better. Thousands of companies work with the CDP to measure, disclose, manage and share environmental information.

The CDP scores companies on their performance. “A high performance score signals that a company is measuring, verifying and managing its carbon footprint, for example by setting and meeting carbon reduction targets and implementing programs to reduce emissions in both its direct operations and (the extended) supply chain.” Companies score higher if they are focused not just on internal emissions, but the emissions caused in their extended value chain. This causes a ripple effect as big companies with sustainability goals request their suppliers to also reduce their emissions.

Read more at Sustainability Drives Supply Chain Professionals to Learn New Finance and Accounting Concepts

What is your opinion towards “sustainability”? Do you think it is a priority? Share your thoughts with us in the comment box below.

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Resilinc to Unveil the Top 10 Supply Chain Risk Management Insights of All Time

The Top 10 Supply Chain Risk Management insights of all time are the most impactful conclusions, lessons learned, and heuristics that all SCRM practitioners should be acutely aware of in order to maximize their chance of success in achieving risk management and resilience performance excellence. Bindiya Vakil, founder and CEO of Resilinc, and Ann Grackin, CEO of ChainLink Research, will lead the discussion.

“These are the insights born from real-life experience in the trenches, battle scars, and “ah hah” moments,” said Vakil. “They are based on Resilinc and ChainLink Research company experience—working with the most complex supply chains in the world as solution providers, consultants, and practitioners in previous lives—as well as crowd-sourced contributions from risk thought leaders and luminaries in industry and academia.”

The top 10 insights will each be presented as important threads in an overall strategic-framework fabric. When implemented in their totality, the top 10 insights may form the backbone of a successful best-practice-driven SCRM program.

Participants in this Webcast will have the opportunity to:

1. Gain insights and best practices to improve SCRM and resilience program performance.

2. Apply insights as part of a strategic framework for success.

3. Benchmark their organization’s resilience program best practice adoption against the top 10 insight list.

Read more at Resilinc to Unveil the Top 10 Supply Chain Risk Management Insights of All Time

Will you take part in the event? What are your expectations ? Share with us in the comment box.

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US Supply Chains More Vulnerable to Climate Risks

US Supply Chains More Vulnerable to Climate Risks

Lack of preparation currently leaves supply chains in Brazil, China, India and the US more vulnerable to climate risks than those in Europe and Japan, according to a report by CDP and Accenture.

Supply chain sustainability revealed: a country comparison also finds suppliers in China and India deliver the greatest financial return on investment to reduce their greenhouse gas emissions and demonstrate the strongest appetite for collaboration across the value chain.

The research is based on data collected from 3,396 companies on behalf of 66 multinational purchasers that work with CDP to manage the environmental impacts of their supply chains. They account for $1.3 trillion in procurement spend, and include organizations such as Nissan and Unilever.

Analysis and scoring of suppliers’ climate change mitigation strategies, carbon emissions reporting, target setting, emission reduction initiatives, climate risk procedures, uptake of low-carbon energy, and water risk assessment efforts, as disclosed by suppliers to CDP, were used to create a sustainability risk/response matrix that shows how well prepared suppliers across 11 major economies are to mitigate and manage environmental risk in their supply chains.

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3 ways companies can identify climate risks in supply chains

3 ways companies can identify climate risks in supply chains

Despite the enormous value at stake, climate risks in supply chains can be hard to see because they are so large. The key to getting it right, according to Acclimatise CEO John Firth, who spoke at the BSR Spring Forum last week, is for managers to address supply chain climate risks in terms of existing stressors — such as procurement costs, on-time delivery, water availability and secure energy and infrastructure.
At the Forum, speakers and participants identified three lenses that can help company managers connect climate change to existing supply chain concerns.

Vulnerable regions

The economic costs of climate-related disasters are rising, in large part because business is consolidating in vulnerable regions in the name of market growth and efficiency. It is projected that by 2070, seven of the 10 largest economic hubs will be in the developing world, and assets exposed to floods will rise from 5 percent to 9 percent of global GDP.

Categories at risk

Sustainability professionals also can address climate risk through global supply or procurement categories that are dependent on stable climatic conditions, such as crops, capital-intensive infrastructure and water-intensive operations.

Sustainability destabilizers

Finally, climate change undermines companies’ ability to address material sustainability issues. Many companies are working to improve economic development in the communities in which they operate, yet climate impacts, especially disasters, can depress job markets for years. Or, while it is typical for companies to commit to reducing greenhouse gas emissions, the lower water runoff associated with droughts can reduce the capacity of hydropower, the most mature source of renewable power

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Five factors of supply chain sustainability

The five factors of supply chain sustainability

Leadership, empowerment and sharing success stories are among the attributes required to implement sustainable procurement.

That’s according to a panel of experts who shared their top tips at the Institute for Supply Management annual conference in Las Vegas, US last week. The advice included:

  1. Sustainability champions : “Find out who’s passionate about this in your organisation and ask them to be champions.”
  2. Leadership : “You are all leaders to your supply chain, they’re looking to you and your actions and expectations.”
  3. Empowerment : “If you give people a ladder to execute in their own fashion they will take ownership of it.”
  4. Success : “Nothing sells better than success, so we recognise and reward success.”
  5. Metrics : “If you can communicate what you [have done], it is really a powerful story.”

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Coca-Cola refreshes sustainable sourcing goals

Coca-Cola refreshes sustainable sourcing goals

Coca-Cola has increased efforts to make its supply chain more sustainable by announcing a series of new targets in the areas of sourcing, water use and carbon dioxide emissions.

The drinks producer, which is working with the World Wide Fund for Nature (WWF) on its sustainability programme, announced a target of improving water efficiency by 25 per cent among a series of sustainability goals for 2020. It also pledged to reduce carbon dioxide emissions of its drinks by a quarter and to work with the WWF to ensure that materials for its PlantBottle, which is manufactured entirely from plant materials, are sourced sustainably.

Other additions to its 2020 sustainability strategy include working to ensure key ingredients, such as sugar cane, mango and pulp and paper are sourced sustainably and replenishing 100 per cent of the water expended through its operations. It also aims to reach a 75 per cent recovery rate on the bottles and cans it sells in developed markets.

Coca-cola’s strategy is one of many good examples about how supply chain management is utilized into operations. If you are interested in how to improve your supply chain management, feel free to contact us.

 

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