Supply chain News and trends

Four ways supply chain risks are getting amplified across all phases of risk management, and a checklist for how procurement teams can respond to build resilience for a 'permacrisis' era

In a world marked by rapid change, procurement's role is evolving from managing costs to leading sustainability efforts and managing a diverse range of risks. Companies embracing this shift are not just building supply chain resilience but are also gaining a competitive edge, enhancing revenue, attracting top talent, and spearheading industry innovation.

Carbon management solution empowers brands, purchasing organizations, and investors to drive Scope 3 climate action at scale 

EcoVadis announced its Carbon Action Module (CAM) has received a Top Product of the Year Award from Environment + Energy Leader. The 2023 E+E Leader Awards program commends excellence in products and projects that deliver significant energy and environmental benefits. 

Speaker: Andrew Winston, globally recognized expert on megatrends and how to build companies that thrive by serving the world, author of Net Positive, The Big Pivot and Green to Gold.

The Sustainable Value Chains podcast series features senior sustainability experts and executives who explore a wide range of environmental, labor and human rights, ethics, and sustainable procurement issues and looks at how companies can develop more sustainable value chains. 

In its seventh edition, the EcoVadis Index provides insights from the sustainability ratings of more than 62,000 companies assessed between 2018 and 2022. Based on data from over 100,000 assessments, this summary report showcases that companies across sizes, industries and regions have been consistently improving on our core sustainability themes: Environment, Labor & Human Rights, Ethics and Sustainable Procurement.

One of the virtues of our volume is that it provides a more nuanced picture of how a change takes place in practice – as the EcoVadis network scales up, we see how more and more companies move from de-risking to Advanced performance. Not all companies have the same capacity to simultaneously integrate an environmental, social and governance lens into their businesses, however.

Which companies are more likely to be on the top end, and which are likely to be low performers? Read on or learn more at Index Online.

In a hyper-connected trade economy, almost every area of business performance is tracked, assessed, or evaluated. As a trading partner to a multinational or value chain, you probably measure across price, cost of capital, service and quality. Like many business-to-business companies, you might also report on your environmental, labor and ethics practices. For many companies, sustainability is no longer something to monitor – environmental, social and governance (or ESG) metrics are used alongside traditional cost and quality stats to evaluate suppliers.

In what needs to be a transformative decade, the private sector is increasingly being called upon to leverage the interconnectedness of global value chains to address complex sustainability challenges. This report explores how EcoVadis is helping companies respond to these calls by enabling them to collaborate with their trading partners to drive improvement and scale sustainable change. It also highlights the progress that the more than 100,000 rated companies in our network are making on measuring and reporting the positive outcomes – or impact – of this journey. 

Moderated by Santosh Nair (GEP), the panel comprised Deitra Curry of Masco, Eric Evans of RapidRatings, and Larissa Rindosh of EcoVadis. Together they discussed how to master risk management.

ESG (environmental, social and governance) – or sustainability, has taken up social space and dominated business agendas, swaying consumers and investors alike. It's more than just a trend – in some shape or form, the term has been around for quite some time, subsuming the concepts of corporate social responsibility and responsible business. As the demands rise for sustainability to be viewed as a business risk – or opportunity, stakeholders are turning to ESG ratings to quantify performance. If you’re a vendor or business partner in a supply chain, this demand may materialize in a form of a sustainability questionnaire from your customers.

As interest in ESG and sustainability measurement and reporting grows, so too does private equity (PE) investors’ interest in reviewing ratings as they evaluate companies. A PWC Global Private Equity Responsible Investment Survey revealed that 72% of respondents always screen target companies for ESG risks and opportunities at the pre-acquisition stage. Interestingly, 56% of respondents have refused to enter general partner agreements or turned down investments on ESG grounds – making the connection between ESG/sustainability and investing activity even more tangible.

By making ESG and sustainability ratings a top priority, companies can boost their enterprise valuation while lowering the cost of capital.

With a company’s supply chain accounting for up to 90% of its carbon footprint, gaining visibility of greenhouse gas (GHG) emissions hotspots and driving collaboration on carbon management among suppliers is essential to decarbonization at scale. However, as EcoVadis’ first-ever Carbon Maturity Report found, achieving this remains a distinct challenge. The report showcases data from the first 15,000 carbon maturity ratings issued by EcoVadis since the launch of the Carbon Action Module in 2021.

In its sixth edition, the Sustainability Risk and Performance Index: Insights from Global Supply Chain Ratings examines the sustainability performance of more than 53,000 companies assessed by EcoVadis during the period 2017-2021 and provides critical insights into sustainability trends across diverse regions and industries.

View the full report or --  if you’re craving more detailed information about how your industry or region compares against the others and want to create customized graphs -- check out My Index Online.

Young people are passionate about driving change on the climate issues that stand to impact their future. This sentiment was especially evident at this year’s Sustain conference, where youth climate activists conveyed their focus on climate change and mitigating its effects. Evelyn Acham, the national coordinator of the Rise Up Movement, and Ester Galende-Sánchez, a climate policy researcher for the Basque Centre for Climate Change (BC3), discussed the current severity of the climate crisis and the steps we must take in their session.

Their concerns are warranted. 

The Intergovernmental Panel on Climate Change (IPCC) reports that “unless there are immediate, rapid and large-scale reductions in greenhouse gas emissions, limiting warming to close to 1.5 degrees Celsius or even two degrees Celsius will be beyond reach.” According to Carbon Trust research, Scope 3 emissions (indirect emissions occurring in a company’s supply chain) represent from 65 percent to 95 percent of a company’s broader carbon impact. While 14 percent of companies rated in the inaugural Carbon Maturity Report 2022 have a publicly available GHG emissions report, only 3.7 percent engage their suppliers on climate action. 

Suppliers can showcase sustainability accomplishments to thousands of buyers with new SAP Business Network integration; Supply chain finance brings added mutual value.

Digital integration and sustainability were strong themes at the 2023 SAP Sapphire conference in Orlando, Florida, which showcased the powerful new ways customers drive sustainable procurement with EcoVadis and SAP tools.

EcoVadis’ Head of Global Alliances, Daniel Perry, attended the event in Orlando to support our expanded partnership with SAP, and the new integration - which is the first of its kind - between EcoVadis business sustainability ratings and the Trading Partner Profile of SAP Business Network.

EcoVadis is proud to sponsor the SPLC Summit on August 14- 16, 2023. We will have a booth and will be presenting about Supply Chain DEI and Supply Chain Decarbonization. Stop by our booth or attend our presentations to learn more and accelerate your sustainable procurement program.

In addition to collaborative workshops, expert presentations, and insightful plenaries, the 2023 Summit presents specialized training tracks designed to equip attendees with the essential knowledge offered by the SPLC.

In this podcast episode, Fergal Byrne interviews Kevin Rabinovitch, the Global VP of Sustainability and Chief Climate Officer for Mars, Incorporated, regarding their supply chain decarbonization efforts. Kevin explains his role in Mars and the three main responsibilities of his team: serving as subject matter experts on climate, water, and land; conducting sustainability accounting; and overseeing renewable energy and carbon projects. He emphasizes the significance of scope 3 emissions in Mars' greenhouse gas footprint, accounting for 96% of their total emissions, while their direct operations represent only 4%. The majority of Mars' emissions are associated with agricultural raw materials used in their products.

At the opening of the event, the co-founders and executives announced the publication of the "Network Impact Report" which presents the first progress made since EcoVadis chose to officially become a mission-driven company.  With more than 100,000 companies assessed and nearly 1,000 customers now using the EcoVadis platform to engage their supply chain with the total of €2.5 ($2.6) trillion in spend covered by EcoVadis Ratings.

At the close of the event, we have over 7000 registrants and 82 countries represented. Thank you all for making this hybrid edition a success:

More than 450 participants at the Trianon in Paris over the 2 days 

More than 3300 online participations, with an average of more than 6 hours of connection

It is now up to all of us to make the most of all the exchanges, feedback and connections made.

A big THANK YOU to the more than 50 speakers who gave inspiring speeches during these 2 days, and to our 20 sponsors. 

Speaker: Matias Pollmann-Larsen, Global Lead for Sustainable Value Chain at Accenture, hosted by Fergal Byrne, Executive Producer, The Sustainability Agenda.

Supply chains is what keeps the world going. So it's no surprise that they generate 60% of global emissions. If we want to accelerate decarbonization globally and if we want to meet our ambition to decarbonize by 2050, supply chains are the answer. In a discussion with Fergal Byrne, Matias Pollmann-Larsen, Accenture's Managing Director, Global Sustainable Value Chain Lead, sheds light on the importance of supply chain decarbonization and the strategic benefits that arise from embedding sustainability throughout the organization. 

Speaker: Andreas Rangel Ahrens, Head of Climate at IKEA, hosted by Fergal Byrne, Executive Producer, The Sustainability Agenda

Looking at carbon emissions coming from a company’s operations only has long been understood as insufficient if we are serious about decarbonization. But looking separately at emissions coming from own operations as well as the value chain may not be ideal either. This is what IKEA has found. “We usually do not split [emissions] into scopes 1,2, 3. We always look into the totality of the IKEA business impact on climate change,” says Andreas Rangel Ahrens, Head of Climate at IKEA, explaining that instead the company sets specific goals for each part of business: materials, production, transport, etc.

Net Zero: Targets, Goals Objectives and the Start of the Decarbonization Journey

Carlsberg did its first global Scope3 emissions assessments over a decade ago with the first attempt to analyze the impact of the company's and its suppliers' fuel and energy usage. But it wasn't until 2017 that the Group launched its sustainability program Together Towards ZERO, which introduced a more professional approach to Scope 3 management with consistent measurements and understanding what had to be done in order to reduce emissions. 

Latest Innovations in the Risk Management Solution Reinforces EcoVadis Market Leadership of Sustainability Visibility and Insight 

With organizations finding it difficult to gain complete visibility on the sustainability risks of their trading partners as supply chains grow increasingly complex, EcoVadis announces it has added AI and data mining enhancements to its market-leading predictive intelligence solution. 

Companies require more intelligence and due diligence capabilities to help them efficiently comply with an evolving regulatory and risk landscape. IQ Plus addresses this need by providing organizations with immediate, broad visibility across their supply base. In addition to the existing country, industry and procurement intrinsic risk factors, IQ Plus expands each risk profile with supplier-specific insights on their transparency across all sustainability dimensions. This provides an even richer mapping of an organization’s entire supply base for environmental, social and ethical risks and opportunities.

Latest research from Supply Management Insider, with support from EcoVadis, found that protecting the environment, human rights and livelihoods of workers is exceptionally important to the majority of procurement professionals.

However, many work for organisations that, despite current or anticipated regulations that require such due diligence, have under-developed sustainable procurement programmes that are currently ill-equipped to achieve these ambitions. Thus, many procurement heads and their teams may be missing out on a potential "gold mine" of motivation and engagement - as well as all the benefits of a successful SP programme.

This whitepaper presents, analyses and interprets the results of that research and recommends practical steps organisations can take to ensure they have all the success factors in place.

The ESGFinTech100 is an annual list of 100 of the world’s most innovative ESG companies offering solutions for the financial services industry selected by a panel of industry experts and analysts. These are the companies every financial institution needs to know about as they consider and develop their ESG assessment and performance improvement strategies.

The list is part of a series of studies that highlights the leading companies in sectors such as RegTech, InsurTech and WealthTech to help executives stay on top of the latest innovations. Companies that won places on these lists generated huge awareness among financial services firms. Many were approached directly by banks and financial institutions, while other got a more welcome reception from prospective clients and partners.