How sustainable supply chains are driving business transformation

A survey of supply chain leaders shows the need for visibility on sustainability performance and a holistic business case to drive results.

In brief

  • EY teams surveyed 525 executives about their sustainable supply chain practices. Many have long-term strategies but struggle to measure their progress.
  • Business case initiatives for sustainability stretch beyond cost savings to increased revenue, customer loyalty and share price.
  • To reap the benefits now and in the long term, companies should align to science-based targets and begin work to define and achieve those goals. 

Supply chains are sustainability’s new frontier. They are core activators for organization-wide sustainability goals and commitments. With sustainability in mind, supply chain executives are forging ahead, taking steps to protect their access to resources and bolster resiliency, and yet finding challenges to overcome and new opportunities to further explore.

EY teams conducted a survey about the sustainable supply chain approaches at 525 large corporations across Argentina, Brazil, Canada, Mexico and the United States (US). The various sectors included retail, consumer packaged goods, health providers, life sciences, government, technology, energy, manufacturing, mobility, and food and agriculture.

The research shows that while many executives have long-term sustainability goals for their supply chains, few have the visibility, technology and comprehensive programs in place to measure their progress. Challenges to their initiatives include upfront costs and a lack of a clear business case to support the expenditures.

Focusing on supply chains is key to overall environmental, social and governance (ESG) efforts because more than 90% of an organization’s greenhouse gas emissions,1 and 50% to 70% of operating costs, are attributable to supply chains. Beyond risk avoidance and compliance, organizations are seeking ways to create long-term value by embedding sustainability into supply chain operations.

EY teams research found that eight in 10 supply chain executives are increasing their efforts toward sustainable supply chain operations. Executives are working toward efficient use of natural resources, decarbonization, ethical sourcing and fair trade as part of their larger focus on ESG initiatives. They are also looking to reduce risks, increase innovation and generate a stronger return on investment for their sustainable supply chain initiatives.

This article explores the top three findings from the survey to support executives in achieving their sustainability goals.

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