EY Climate Change and Sustainability Services (CCaSS) collaborated with the UN Global Compact on a study in an effort to better understand how companies are managing their supply chains in ways that support the objectives of the United Nations 2030 Agenda and Sustainable Development Goals (SDGs).
The UN Global Compact is the world’s largest sustainability initiative and EY (Ernst & Young) has been a participant since 2009.
The report draws on business inputs across geographies, sectors and business models.
CCaSS and Advisory Supply Chain and Operations professionals interviewed 70 clients globally to explore how they are embedding sustainability in their supply chains by managing risks and adopting new commitments around human rights, the environment and the well-being of communities in which they operate.
Overall, the study indicates that by improving environmental, social and governance (ESG) performance throughout the supply chain, companies can enhance processes, reduce costs, increase productivity, innovate, differentiate and improve societal outcomes.
Conclusions explored in the report include:
Based on interviews we identified several actions companies can take to further embed sustainability in their supply chains:
The State of Sustainable Supply Chains
Accountability for supply chain sustainability resides within a range of different functions.
Ownership of Sustainability in the Supply Chain
For almost half of the companies interviewed (47%), supply chain sustainability is owned by the procurement or supply chain function.
For 26% of companies, it is owned by the corporate sustainability team, with the remaining companies leveraging marketing, risk, legal, finance or operations to drive efforts.
Executive ownership from the chief procurement officer (CPO), chief financial officer (CFO), chief executive officer (CEO) and board is critical to establishing sustainability as a priority in an organization.
Even beyond this senior management commitment, more can be achieved when the right stakeholders are around the table; for example, having a director from supply chain and the sponsoring business unit director will enable supplier and product decisions to be made.
Download the Paper: The State of Sustainable Supply Chains