Sustainability in all its forms - from humane treatment of workers around the world to using practices that won't damage the environment and more - won't happen without corporate commitment. Businesses need to change their mindsets before they can make a lasting difference in their practices. Supply chain leaders have a huge role to play in this priority shift, considering the serious impact that logistics can have on organizations' global footprints. Fortunately, there are indications that key personnel are taking action.
Balancing the need for sustainability with companies' abilities to achieve other goals such as budgetary objectives and speed targets is a major part of supply chain leadership today. As technology improves and consumer preferences shift, it's becoming increasingly possible to align these multi-faceted requirements. While sustainable practices are far from universal at present, organizations are setting ambitious future targets.
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Supplier networks today can span the world, adding potential difficulty when sourcing departments attempt to ensure high standards among their partners. Fortunately, this hasn't stopped more firms from seeking accountability. The recent Ceres study on organizational sustainability indicated 69 percent of organizations include sustainable practice requirements in their contracts with the third parties they purchase materials and services from. This is up from 58 percent from the previous iteration of the survey, taken three years earlier.
Setting good goals and putting admirable policies into place can only get organizations so far, however. Translating these plans into action may require hands-on work between companies and their supplier networks. According to Ceres, this connection still hasn't materialized. One-third of respondents said they reach out to their suppliers about sustainability directly. That number didn't change between 2014 and 2017. Furthermore, companies' policies tend to target only certain elements of good practices, with few businesses seeking both human rights justice and environmental protection.
Getting the resources to become more proactive is a major roadblock, the researchers noted. Organizations sometimes lack the ability to launch training and outreach programs that target their suppliers. This lack of priority harms these businesses' ability to reach beyond their first tier of suppliers in many cases. Business leaders may need to loosen purse strings to move toward ambitious sustainability goals.
When corporations band together to work on shared projects, they gain a new framework through which to become sustainable. The Thompson Reuters Foundation recently shared an example of such an agreement: The Consumer Goods Forum created the Sustainable Supply Chain Initiative, which is designed to make third-party audits and certifications more visible and accessible to member organizations. The end goal is to create a more straightforward assessment environment in which companies can eliminate harmful labor practices from their supply chains.
These types of large-scale programs are debuting in response to consumer demand. Today's shoppers want to ensure the products they buy aren't being created with slave labor or other immoral systems. Organizations have created mechanisms such as the Sustainable Supply Chain Initiative to be certain they aren't funding such harm at any layer of the supply chain. With so many levels of partners in today's manufacturing and retail environments, this work is difficult but still essential.