A company’s corporate citizenship impact extends well beyond the four walls of the corporate headquarters. A significant amount of environmental, social, and governance (ESG) impact occurs within supply chains, whether it is greenhouse gas emissions, vendor performance, labor conditions within a supplier’s factory, or the sourcing of materials.
Focusing on supply chain sustainability can help to manage reputational risk, reduce costs, improve the quality and continuity of goods and materials, increase revenue, and innovate products and services.[i]
The Center’s January webinar, titled Supply Chain: Managing and Communicating for Corporate Citizenship Success, featured experts sharing insights and experiences that can help you secure a sustainable supply chain. Holly Fowler, an experienced supply chain professional from food services and facilities management and a teaching fellow at the Center, and John Jensen, Operations Director at Dogeared, Mike Wallace, Managing Director at BrownFlynn, and Tim Hopper, Responsible Sourcing Manager at Microsoft offered exceptional examples of sustainable supply chain management.
Sustainable supply chain: trends and benefits
Not surprisingly, supply chain sustainability is one of the fastest-growing supply chain management trends. In the Boston College Center for Corporate Citizenship’s 2014 State of Corporate Citizenship study, 73 percent of executive respondents reported that they considered supply chain partners when developing corporate citizenship efforts. In the same report, nearly 80 percent listed securing a sustainable supply chain as a key business goal.
Ensuring a sustainable supply chain requires collaboration with partners and stakeholders at all levels of procurement, logistics, and manufacturing operations. Issues as serious and systemic as child labor, conflict minerals, and climate change can only be effectively tackled when a company’s commitments to corporate responsibility and reporting are also adopted by their suppliers and partners.
Those companies that are working with their partners to achieve sustainable processes are delivering benefits to the business and to society. A 2008 study found that manufacturing companies that proactively engaged in a joint planning and decision-making process with suppliers were not only able to decrease their supplier’s environmental impacts, but also increased the quality, delivery, and flexibility of their manufacturing processes.[ii]
Sustainable supply chains across all levels of procurement and logistics operations are also directly related to consumer perceptions. As customers are becoming increasingly savvy about sourcing issues, companies are being asked to provide more information and transparency on production and raw materials. When a company’s ESG commitments are not upheld by its suppliers, there can be serious consequences. Research finds that consumers are likely to hold a firm responsible for unsustainable activity regardless of where it occurs within the supply chain.[iii]
January's webinar speakers included:
- Holly Fowler, an experienced supply chain professional from food services and facilities management and a teaching fellow at the Center, will examine the environmental, social, and economic risks and opportunities present throughout a company’s supply chain and explore how to create and evaluate corporate citizenship programs designed for your vendors, suppliers, and third-party providers.
- John Jensen, operations director at Dogeared, a jewelry company and registered B Corporation, discussed how his company has been educating and encouraging their supply chain partners to produce more responsibly.
- Mike Wallace, Managing Director at BrownFlynn, and Tim Hopper, Responsible Sourcing Manager at Microsoft, spoke about their Committee on Supplier Ratings (COSR), which is an initiative to create a common approach to assessing ESG ratings systems.
If you are interested in the topic, members can watch our on-demand webinar, Supply Chain: Managing and Communicating for Corporate Citizenship Success. However, if you would like a more indepth exploration of this topic we offer courses that can help.
[i] PricewaterhouseCoopers and APICS Foundation. (2014). Sustainable supply chains: Making value the priority. Retrieved from http://www.pwc.com/us/en/operations-management/publications/sustainable-supply-chain.html
[ii] Klassen, R.D., & Vachon, S. (2008). Environmental management and manufacturing performance: The role of collaboration in the supply chain. International Journal of Production Economics, 111, 299-315.
[iii] Hartmann, J., & Moeller, S. (2014). Chain liability in multitier supply chains? Responsibility attributions for unsustainable supplier behavior. Journal of Operations Management, 32 (5), 281-294.