Sustainable Supply Chains
For many companies, the largest opportunity for improving sustainability performances such as reducing carbon emissions, water use, toxic chemicals and addressing social and human rights concerns is in its global supply chain. For example, up to 60 percent of a manufacturing company's carbon footprint is in its supply chain. For retailers, that figure is closer to 80 percent – with an equally high supply chain exposure to human rights and social issues. By focusing not only on auditing and remediation but also on supplier education and engagement, companies can significantly reduce environmental and social impacts while also raising the standards of their suppliers and improving the bottom line.
Sustainable supply chain performance begins with companies establishing supplier policies and endorsing industry codes or practices that contain explicit references to social and environmental standards. Corporate policies and practices for their supply chain should not only cover where and how materials are sourced and the environmental impact of a product's life-cycle, but should also recognize the rights of supply chain workers as well as those directly employed by the company.
The potential benefits of improved supply chain performance are every bit as compelling as those achieved through direct action on the companies’ own operations. By bringing sustainability improvements deep into supply chains, companies can better protect their reputations from human rights and environmental violations, increase productivity and save on costs related to energy, water use and reductions in waste and toxic chemical use.
In the video below, Ceres vice president Andrea Moffat provides insights on the relationship between supply chains and corporate sustainability performance. Learn more at www.ceres.org/roadto2020.
Integrating Supply Chain Sustainability
By integrating this issue into our engagements with members of the Ceres Company Network, Ceres is helping companies and investors understand the business case for improving supply chains and recognizing human rights. We provide guidance for partner companies and push for proactive steps such as:
- PepsiCo establishing a policy on the human right to water
- The footwear and apparel industry's “Eco-Index”, a shared platform for companies to evaluate the environmental impacts of the design and manufacturing of their products
- Providing input on the structure, vision and approach of the Electric Utility Sustainable Supply Chain Alliance, including organizing a process to obtain multi-stakeholder input into the group's scope, criteria and disclosure mechanisms
The Ceres Roadmap for Sustainability
Our recent publication The 21st Century Corporation: Ceres Roadmap for Sustainability outlines how companies can honor and uphold fundamental human rights by implementing policies, codes of conduct, management systems and rigorous monitoring practices. The Ceres Roadmap also urges corporations to view human rights in terms of the overall supply chain and to use their influence to spread best practices—for example, by choosing suppliers and partners whose policies protect workers’ rights.