A big question facing logistics managers is the problem of establishing and maintaining sustainable supply chains.
Simply put, the rise of globalization and the resulting long and complicated supply chains make it difficult to track and meet sustainability goals, especially when coupled with the risks and uncertainties of climate change, economic volatility and political turmoil. If one supplier falls down on sustainability, it can drag down the entire operation.
With that in mind, Ceres, a sustainability advocacy group, has released a free online tool to help companies assess their supply chain sustainability.
“Building resilient supply chains is essential in an era when increasing extreme weather events around the world are frequently disrupting commerce, and human rights concerns can damage even the glossiest reputation,” writes Amy Augustine, Director, Corporate Programs for Ceres. “Recent flooding in Thailand that shuttered auto parts factories for months and a rash of suicides among unhappy workers at the Foxconn electronics assembly company in China are just two examples of supply chain disruptions causing negative ripples for leading global companies.”
The Supplier Self-Assessment Questionnaire (SAQ): Building the Foundation for Sustainable Supply Chains was designed for the industrial goods sector, but is applicable to all companies seeking to strengthen supply chain engagement, according to Ceres. It’s intended to be the first step in developing dialogues between a company and its suppliers to identify, assess, manage and disclose supply chain sustainability risks.
Augustine says that for many companies, the biggest sustainability risks they face are embedded in the supply chain. “While some companies and industry sectors have developed fairly sophisticated methods for assessing and improving the sustainability performance of their suppliers, Ceres’ year-long survey of best practices in this arena revealed that most focus on either environmental or social impacts.”
It’s not an either/or situation, she continues. “Effective supply chain management requires attention to both, including issues such as climate change, water scarcity, human rights, governance and stakeholder engagement.”
That’s where the SAQ will be useful for all companies seeking to strengthen that supply chain engagement. It’s also useful for companies that are beginning to address sustainability issues in their supply chains.
Ceres was founded by a small group of investors in 1989 in response to the Exxon Valdez oil spill. Since then it has worked to “weave sustainable strategies and practices into the fabric and decision-making of companies, investors and other key economic players.”
Ceres says it will work with a group of companies and industry coalitions to promote the use of the tool either as a stand-alone or a complement to other tools companies may already have in place.
Supply chains face multiple risks, but perhaps the most insidious is a lack of transparency and resiliency along the entire chain—in short, understanding and identifying the risks. The SAQ goal is worthy and timely: to help companies’ supply chains build resiliency and become more competitive by identifying, assessing, managing and disclosing supply chain sustainability risks.