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Supply Chain Sustainability: Why It’s Important & How to Improve It

23 June 2022

Sustainability often causes people to think about good practices for the environment. 

While this is one benefit of supply chain sustainability and sustainable procurement, these practices also reward:

  • Consumers with the peace of mind that the products they buy don’t negatively affect the world. 
  • Employees with safe workplaces and fair working terms. 
  • Businesses with lower costs, better reputations and more. 

 

What Makes a Supply Chain Sustainable?

A sustainable supply chain reduces the negative impact of its operation across the following: 

  • Social issues: Social issues revolve around human rights and fair labour practices. For example, ensuring employees (both direct and indirect) work in safe conditions. 
  • Economic issues: When supply chains fail, they cause problems for every upstream organisation. These events often result in millions of dollars lost each year. 
  • Environmental issues: These issues revolve around deforestation, pollution and more. Some companies make short-term decisions in the name of profitability. But these decisions may have long-term consequences, e.g. global warming. 

 

Why Businesses Need Sustainable Supply Chains

Unsustainable supply chains are costly. Research estimates that climate-related workplace disruptions could result in $2 trillion in lost productivity.

And a leading cause of climate change is greenhouse gas emissions. McKinsey estimates that 80% of consumer companies’ greenhouse-gas emissions come from their supply chains.

But adopting sustainable practices can lead to: 

  • More partnership opportunities: Consumers are becoming more committed to buying from sustainable companies. So a reputation of sustainability increases the number of businesses willing to work with you. 
  • Operating efficiency: Sustainable practices often reduce operating costs in the long run. For example, lighter packaging can reduce shipping weight and fuel consumption.
  • Risk reduction: Sustainable supply chains are robust supply chains. They promote positive practices that reduce the chance of supply disruptions. 
  • Meeting compliance mandates: Governments continue to push towards sustainable development. So, local governments are creating sustainable mandates that companies need to follow. By following sustainable practices now, you can position yourself well for the future. 

 

5 Ways to Improve Supply Chain Sustainability

  • Reuse and Recycle
  • Improve energy efficiency
  • Diversify your suppliers
  • Audit organisations in your supply chain
  • Apply for ISO certifications

 

A Sustainable Supply Chain is Crucial in Building a Resilient, Future-proof Business

Use the five sustainable practices to start improving your supply chain today. Here at Santé we are dedicated to providing a positive social impact on society, our communities, and the environment for the next generation. We ensure that all products we source meet rigorous standards. We aim to use our standing as a global consortium to continue to act as a good citizen in advancing the global sustainability agenda – prioritising our efforts on the most rigorous ethical, professional and legal standards. Talk to us today about our procurement consultancy solutions. 

 

 

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