Supply chain News and trends

After months of public consultation, the City of Sydney has fast-tracked the adoption of an action plan that will help it achieve net zero emissions by 2050, tackle waste and water usage, and scale up renewable energy use.

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DHL further expands its supply chain management and analysis portfolio by launching the DHL Resilience360 Transparency Portal. The online collaboration service allows multinational companies to visualize the full picture of their supply network, including first tier suppliers, their suppliers and so forth.

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Many companies are lagging in their efforts to achieve compliance with a spate of new laws and regulations worldwide for reporting on the used of forced labor within their supply chains, according to a report by Deloitte.
Driving the sluggishness in some measure is a lack of guidance from regulators and governments on how to comply — far different from the scenario when the SEC’s rules on conflict minerals, written to satisfy a provision of the Dodd-Frank Act, took effect in 2011.

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Italian confectionery group Ferrero said on Wednesday it has launched an investigation into allegations that Romanian children as young as six were making toys for its Kinder chocolate eggs.
The statement came after British newspaper, The Sun, reported this week that impoverished families in Romania were working long hours for little pay to make the toys at home.

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Sustainable operations are no longer nice to have, but a necessity for doing business and avoiding social and legal backlash. Sustainability is increasingly top of mind for consumers, and they will likely take their business elsewhere if a brand is found to be in violation of their ethical standards. In addition to increased social consciousness, the regulatory consequences that noncompliant businesses face are immense.

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Transparency International recently reported that emerging market multinationals have dangerously low transparency standards. Specifically, 75 of 100 assessed companies (in their report) scored less than 5 out of 10 overall and scored an average of 48% for disclosure of their anti-corruption programs.

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By working closely with their suppliers, consumer companies can lessen their environmental and social impact and position themselves for strong growth.

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The world’s most popular food and household companies are selling food, cosmetics and other everyday staples containing palm oil tainted by shocking human rights abuses in Indonesia, with children as young as eight working in hazardous conditions, said Amnesty International in a new report published today.
The report, The great palm oil scandal: Labour abuses behind big brand names, investigates palm oil plantations in Indonesia run by the world’s biggest palm oil grower, Singapore-based agri-business Wilmar, tracing palm oil to nine global firms: AFAMSA, ADM, Colgate-Palmolive, Elevance, Kellogg’s, Nestlé, Procter & Gamble, Reckitt Benckiser and Unilever.

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Between April and July of 2016, the Department of Labor (DOL) uncovered wage violations at 85% of the 77 independent Southern California factories investigated, reported the Los Angeles Times last week. Ross Dress for Less, Forever 21 and T.J. Maxx were found to have close ties to the suppliers with the most offenses. Roughly $1.1 million in unpaid wages are owed workers.

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..sugar sustainability is below the radar in confectionery as NGOs have not taken as strong a stance as with other commodities, choosing instead to focus on the sugar health debate.
“I don’t think the confectionery industry has grasped this yet,” said Usher, Bonsucro Chief Executive. “It’s the largest agricultural commodity that no-one cares about. It’s ignored and that’s something we are trying to put right.”

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Last year, Mars and Danone announced their intentions to invest €50m each into the Livelihoods Fund for Family Farming Scheme aimed at increasing the productivity of smallholder farmers to prioritise key crops including cocoa, sugar and palm oil across 40 projects worldwide.
The partnership reflects an increasing willingness from global food and beverage firms to drive positive change in sustainable sourcing, with both Nestle and Mondelez recently displaying strong commitments to supply chain transparency.

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