The importance of supply chain sustainability extends past going green. Over the last decade, customers, investors, and governments have placed pressure on businesses to meet greater environmental and social responsibility standards in their supply chains. It is well-known that a company’s supply chain can make a difference in promoting human rights, fair labor practices, and environmental progress. Due to this, improving supply chain sustainability has become a key corporate objective.
The goal of supply chain sustainability is to minimize harm from influences such as energy use, water consumption, and waste production while also having an impact on the people and communities in and around business operations.
According to Gartner, 30% of supply chain leaders say that their company has no or low-maturity supply chain sustainability goals. Therefore, it is vital that businesses make changes to their supply chain that will not only benefit the world and the people in it but also business operations.
Traditional supply chains utilize an extensive number of resources and produce unnecessary waste due to focuses on speed, cost, and reliability. However, to create sustainable supply chains businesses must focus on taking steps to lower carbon emissions, reduce waste, and improve labor conditions. For example, companies are utilizing supply chain management systems that prioritize renewable energy as well as improve the health and safety of workers. Having a sustainable supply chain also helps with supply chain resilience, which has become more important as geo-political tensions have increased. This means when workers suffer from negative effects of environmental devastation, their ability to perform can be impacted. Subsequently, this will affect consumers and communities.
Experts feel that change starts at the top of the organization because the supply chain is often looked at as an extension of the workforce and surrounding community. A business must set expectations for best practices across its entire supply chain. This enables a broader understanding within the organization, so that negative effects outside of the organization are minimized.