Suppliers Need To Develop A Sustainability Strategy

By Author: eormseo eorm
Total Articles: 11
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Corporate sustainability is the balance between environmental, social and economic components in business decisions and has now become an expectation of customers, shareholders, employees, NGOs and other corporate stakeholders in most businesses.  Corporations that have implemented a robust sustainability program have seen benefits such as improved stakeholder perception, increased innovation, realized efficiencies and reduced business risk.
Most large, public companies have very mature sustainability programs and are further ahead of their suppliers with many moving beyond evaluation of their own operations by driving sustainability into their supply chains.  They accomplish this through publishing “Supplier Codes of Conduct”, distributing sustainability questionnaires, conducting supplier audits, establishing goals for suppliers and developing industry associations such as the Pharmaceutical Supply Chain Initiative (PSCI), Electronic Industry Citizenship Coalition (EICC), and International Council of Chemical Associations’ (ICCA) Responsible Care Initiative.

Sustainability Consulting

In order to ...
... meet customers’ growing sustainability demands, suppliers need to develop a sustainability strategy or risk losing business.  Two examples of customers with sustainability demands are Johnson & Johnson and Dell.  Suppliers to Johnson & Johnson need to publicly report at least two sustainability goals as part of the Company’s Healthy Future 2015 goals and Dell encourages all Tier 1 suppliers to publish a corporate responsibility report.

Strategy Best Practices

Successful sustainability strategies have leadership and structure.  An effective sustainability strategy should have global reach, focus on areas with the highest risk or greatest impacts and consider the environmental and social concerns throughout the organization.  Because of the wide reach of sustainability, it is critical to obtain executive and management support for the work to ensure effective cross-company integration, appropriate resource allocation and development of necessary budgets.  Research has shown that sustainability programs are both top-down and bottom-up developed, but that the most effective programs have top management accepting accountability for its success.