Companies implementing sustainable supply chain practices can gain the “triple advantage” of increased revenue, a reduction in supply chain cost and added brand value, in addition to shrinking their carbon footprint and contributing to local development of the communities they operate in.
A report by the World Economic Forum written in collaboration with Accenture, Beyond Supply Chains – Empowering Value Chains, found that companies included in the analysis improved their competitiveness through increases in revenue (5-20 per cent), a reduction in supply chain costs (9-16 per cent), a boost in brand value (15-30 per cent), and shrunk their carbon footprints (13-22 per cent).
Representatives of 25 corporations, including Nestle, SAB Miller and UPS, were interviewed for the report, which also drew on insights from non-government organisations and other sustainability experts.
The report outlines 31 practices that other companies have successfully used, and which can be applied to evaluate the value-creation potential of their organisations’ supply chain practices and prioritise sustainability investments, as well as guidance on ethical commerce practices.
“Sustainability must become a higher priority in supply chain management, given the scarcity of natural resources, rising commodity prices and greater consumer expectations for responsible sourcing and production. Those who act now and capture the market opportunity of more sustainable supply chains can differentiate themselves and generate higher margins,” said Mark Pearson, senior managing director, Accenture Strategy. “This is not about trade-offs; it is about behaving in a socially responsible way that can also deliver a competitive edge.”
“Part of the difficulty to date has been the decision-making process itself as it relates to sustainability,” said Wolfgang Lehmacher, head of supply chain and transport, mobility industries, World Economic Forum. “Our hope is that this report will empower companies to act now and place an emphasis on the maintenance and creation of responsible supply chains.”
