June 09, 2023 | Supply Chain Strategy
Chief supply chain officers are increasingly taking responsibility for their organization’s ESG and sustainability efforts, according to a recent GEP and North Carolina State University (NCSU) survey of procurement and supply chain professionals. The survey results indicated that CSCOs ranked third, behind only CEOs and COOs in their responsibility for ESG initiatives. In fact, the CSCO is now more responsible for sustainability than the chief sustainability officer or chief financial officer (CFO).
That responsibility reflects the impact that scope 3 emissions can have on a company’s total carbon footprint, with 70% to 90% of total emissions stemming from the supply chain.
As the CSCO is responsible for managing an organization’s network of suppliers and trading partners, they should be playing a primary role in managing scope 3 emission-reduction projects and sustainability initiatives.
With tighter regulations coming in the U.S. and Europe, CSCOs need to increase visibility into their supply chains to build resilience, help control costs and meet upcoming standards. What can they do to gain that visibility?
Organizations should invest in technologies and systems that enable seamless data integration and connectivity across the supply chain. This allows real-time monitoring and sharing of information related to suppliers, transportation, inventory levels and environmental impact.
Data derived from suppliers and partners may be incomplete, inaccurate or inconsistent. Modern AI-powered supply chain platforms enable companies to normalize supply chain data, connect data sources and eliminate silos, allowing them to derive insights and track supplier performance holistically.
Establishing key performance indicators (KPIs) and metrics related to sustainability allows organizations to track progress and measure the impact of their initiatives. This includes monitoring carbon emissions, water usage, waste generation, and other sustainability-related metrics. Regular reporting and transparency further drive sustainability practices within the organization and the supply chain.
Organizations should actively collaborate with their suppliers to foster sustainability practices. This can involve sharing sustainability goals and encouraging suppliers to adopt environmentally friendly processes. Regular communication and feedback mechanisms help ensure that sustainability standards are met throughout the supply chain.
Enterprises can start by mapping their supply chains to determine their strategic suppliers and work from there as a starting point. Gaining visibility into suppliers can help identify areas for collaboration and quick wins on sustainability that can drive future progress toward goals.
By implementing these steps as a starting point, chief supply chain officers can enhance their supply chain visibility and accelerate the journey toward their sustainability goals, leading to improved environmental and social responsibility, resilience and long-term cost reduction.
To learn more about the NCSU survey results, download the full report, Driving Supply Chain Sustainability in the Face of Disruptions and Cost Pressures , available on our Knowledge Bank.