Supply chain disclosure varies between companies

on Wednesday, December 26, 2012

Supply chain disclosure varies between companiesAccording to a new report from analyst firm Verdantix, some electronics companies headquartered in Asia take greater strides to report the environmental achievements in their supply chains than others.

The data revealed that companies like Apple, Dell and Hewlett-Packard take more initiative to report their sustainability measures than Canon, Panasonic and Samsung. The report took into account data from 12 different companies and indicates some of these corporations are much more concerned with such reporting and environmental achievements than others.

These companies often take into account different initiatives when conducting such reporting, however, most of them take the time to investigate their suppliers' materials. Many also take into account waste production and pollution, allowing the report to determine which companies are more thorough or consistent than others.

Many fail to report on some important issues
However, not all companies take the time to report on issues that are becoming more important to consumers, investors and government bodies. According to the report, Canon, Microsoft and Toshiba fail to report on air pollution, giving the public little knowledge of the amount of greenhouse gases produced by the corporations' vast supply chains that reach across the globe. Similarly, Apple, Canon, Panasonic, Sony and Toshiba were reported to not audit the energy use of their suppliers, making it unknown what - if any - sustainability steps their suppliers take to reduce energy use, limit pollution or use renewable sources such as solar and wind.

While most audit energy use, only half of the corporations were reported to investigate water consumption of their suppliers. Only Dell, HP, LG, Microsoft, Nokia and Samsung took the steps to examine water use, which indicates that they could be the only companies able to regulate water waste and turn to processes that may reduce consumption, an environmentally friendly strategy and potential cost reduction tactic.

Potential benefits to auditing and reporting
While some companies may see audits and reports as time consuming or wasteful, other corporations may find valuable insight by conducting such projects. Companies that take the steps to learn about the processes their suppliers or manufacturers use may discover that they are able to enjoy greater cost savings by implementing green energy, which can in turn lower the direct material cost for a purchasing company and bring in even more business. Those that fail to oversee their supply chain operations thoroughly may waste valuable opportunities such as this or even miss out on the chance to work with companies or investors that require high sustainability standards.

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