The Dawn of Supply Chain Sustainability

In May, Copenhagen was once again the host of a significant sustainability-related conference. This time around it was the United Nations Global Compact Week and was thus highly diverse in its discussed subjects. But one topic I found particularly intriguing was that of supply chains.

UN’s Global Compact
The United Nations Global Compact is the world’s largest network and strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, equality, environment and anti-corruption. Caring for Climate is a voluntary initiative and complementary action platform for UN Global Compact participants seeking to encourage and show leadership on the issue of climate change, social equality and anti-corruption just to mention some of the challenges.

The Compact’s website defines itself as “a strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption”  The issues the conference discussed, then, spanned a range of cross-sectoral subjects – a definition which supply chain sustainability fits squarely into. To best manage a supply chain, one most consider beyond environmental impacts into fair trade, labour law enforcement, corporate social responsibility practices, efficiency, and more. In fact, I enjoy the term “supply chain” because it so clearly evokes a series of linked objects, each inherently connected to and influencing the other.

So what is supply chain sustainability?
A tongue twister? Rather, it is a way of investigating and redesigning the entire supply chain of a business from raw material extraction to final product. The idea is there is a plethora of unintended waste, corruption, and risk involved in poor oversight of everything leading up to a company physically securing all of its supplies. Some examples of issues a company investigating its supply chain may come across: excessive irrigation, child labour, poor safety practices at mines, and unnecessary disposal of reusable or sellable items. Joint-efforts like the UN Global Compact focusing attention in the field of supply chain sustainability are absolutely necessary for the future of sustainable cities.

Not only are urban areas impacted by the management of natural resources (both in terms of consumption and conservation) that are the root of all supply chain operations; but also local businesses, which greatly influence the livelihood of their urban surroundings, have a great opportunity to improve the standards of business ethics and sustainability all over the world. Globalization has made it possible for proactive companies to affect sustainability on the ground at every point their operations’ reach. For a good illustration of the life-cycle a single product endures, check out the Levi Strauss life-cycle page for a pair of jeans: http://www.levistrauss.com/sustainability/product/life-cycle-jean. This may lend some idea of how expansive the effects of a sustainably managed supply chain can be.

From Coca Cola to Tom’s Chocolate
A couple of the companies presenting on supply chain sustainability in association with Global Compact Week were Coca Cola and Tom’s Chocolate. From their tales, it was fascinating to contemplate that not only can this process reduce some of the negative effects of business, but it can actually be the impetus for positive initiatives. For example, Tom’s used the results of their supply chain investigations to develop a program for training teachers and improving public schools to combat child labour around Ghana, where the majority of their cocoa beans are sourced. This program reached around 20,000 children and helped bump their annual test pass rate from 60% to 90%.

One could ask how Tom’s benefits from this program, and I would say: Tom’s is improving the security of its main country of cocoa supply, increasing the business inclination and creativity of a young future workforce, and simultaneously pleasing investors who are openly interested in ethical practices. These companies, pioneers in supply chain sustainability, have some messages to share: (1) partnerships are an indispensable tool in shaping business practices (i.e. Coca Cola/Bonsucro/WWF and Tom’s/Danida/IBIS), (2) though it’s difficult to get started, making well-researched site visits can be very inspiring, and (3) supply chain sustainability is not about PR (in fact it can have little effect on it at all), but it is about making better business with better ethics for a better world.

To learn more about the UN Global Compact and Supply Chain Sustainability HERE

Also, learn more about Caring for Climate, a voluntary initiative and complementary action platform for UN Global Compact participants seeking to encourage and show leadership on the issue of climate change, social equality and anti-corruption just to mention some of the challenges. HERE