What are Sustainable Supply Chains and Why are They Needed?

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What are Sustainable Supply Chains and Why are They Needed?

Regardless of the industry or location, companies across the globe are finding that sustainable business practices and the adoption of greener technology are leading to lower costs, improved business value, and more sales.

Sustainability isn’t just a surface issue, one where a company can say, “we’re sustainable” and not put the effort in – more and more people, consumers, investors, and business partners, are looking for businesses who are investing in and practicing sustainable business practices – and this relates to the entire company, not just the public face.

Sustainable Supply Chains

Sustainable Supply Chains are supply chains which involve Environmental, Social, Governance (ESG) concerns and generally prioritise social responsibility, ethical sourcing and production, use of materials that has a lower (or offset) environmental impact, and a distribution which does not have a negative social or environmental impact.

A considerable number (57%) of public-facing businesses have sustainability goals for their supply chains when compared to companies overall (47%), but even overall, almost half of companies are now developing sustainable supply chains, because they have realised that this next step in sustainability is already making an impact on business partners, investors, and consumers.

What is the Aim of a Sustainable Supply Chain?

Depending on which area of ESG a company is focusing on a the time, there are different aims and goals involved in creating a sustainable supply chain – but as ESG is often reported together, these goals are often collated into one strategy and simply sectioned into the relevant parts.

In general, a sustainable supply chain is looking to:

  • Minimise environmental harm: This may be from water consumption, wastewater, energy usage, reduction of harmful gasses, or waste production.

  • Create a positive impact: This may be on local communities who are involved with the production and assembly of products, those involved in the transport and shipping process, or even those involved in offices or storefronts.

  • Improve Social Impact: This could be the prevention of worker exploitation, safeguarding human rights, improving diversity and inclusion, etc.

  • Source sustainable materials: Products which can be made from recycled materials are often researched and improved on, but it may also involve sourcing materials ethically, ensuring fair labour and working conditions, etc.
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