Is your Supply Chain Sustainable?
In the past decade, businesses have been responding to United Nations (UN) and global environmental agencies’ demands for them to accommodate sustainability. For years, the public’s understanding of sustainability was stuck to the imagery of environmental protection measures. But today’s definition of sustainability goes far beyond this. It needs to consider both the planet and human race long term survival. So, what is sustainability and how can your business contribute?
What is sustainability and sustainable development?
In 1987, the UN defined sustainability as “meeting the needs of the present without compromising the ability of future generations to meet their own needs.” Later on, this concept was updated to the current understanding of global justice “founded on respect for nature, universal human rights, economic justice, and a culture of peace.” In practical terms sustainability means re-examination of organizations policies on 1) environmental protection, 2) social responsibility and 3) economic practice.
In 2015, the UN created the Sustainable Development Goals (SDGs), aiming to see considerable improvements by 2030. These 17 goals translate into actionable measures to achieve a sustainable future.
People – Planet – Profit: triple bottom line balance
Doing business is no longer just about maximizing profit. Now, corporates and organizations increasingly develop their Corporate Social Responsibility (CSR) policies to conjugate the economic, social and environmental impact of their business. Simplifying, this triple bottom line system often means looking in depth into the three pillars. It should also involve all stakeholders raging from employees, customers, suppliers, local residents, government agencies, to creditors.
Businesses - as intersections of several economic, financial and industry sectors - have a special responsibility to place themselves as sustainability advocates. Businesses can start by ensuring all links of their supply chain respect sustainable economic, social and environmental business standards. Companies can never be too small or too big to have an impact.
The benefits of a sustainable Supply Chain
Assessing and improving a supply chain can be costly, but the benefits are always greater, especially in the long term. The most obvious is securing a sustainable future in line with UN Sustainable Development Goals. Some other benefits are visible in the shorter term:
1. Reduce supply chain risks: We already saw that a supply chain can have unknown risks like unfair labour conditions or heavy climate impact. Reducing these risks means reducing your liability on eventual negative aspects of the process and avoiding unnecessary costs resulting from that.
2. Save costs: There are saving impacts all across your supply chain. From more energy efficient buildings to cutting down on the costs of hazardous waste management for e.g., if you run a business there are ways for you to improve resource efficiency and save.
3. Improve your brand image: If your company is contributing to a sustainable development, don’t hesitate to spread the news. The trend shows that consumers, investors and competitors will take notice of your good practices. You might even inspire more businesses to take action and join the sustainability movement.
4. Attract and retain talent: Like consumers, talent cares about company values and policies. Highly qualified talent, especially millennials, are more likely to choose to work and stay in a company with positive social and sustainable practices. This purpose-led choice can save your company a lot of money and time in recruitment processes and training.
5. Achieve operational efficiency: Limit the waste of natural resources and improve business growth by optimizing all your processes. This will result in significant savings. Most businesses can find ways to implement lean processes. Take the example of the logistics industry, where often delivery and pick-up routes are not optimized and result in unnecessary fuel spending – this can be easily avoided by using a delivery management platform like Urbantz.
How sustainable is your business? Download our assessment guide and find out for yourself!