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Supplying sustainability: supply chains and the SDGs

Updated: Dec 17, 2020

Article by: Susan T. Jackson and Zachary Parker

The Business Commission estimates that achieving the UN Sustainable Development Goals (SDGs) by 2030 could mean unlocking an additional US$12 trillion and creating 380 million jobs globally. As Momentum Novum has noted before, the private sector is pivotal to achieving these goals. And, the UN Global Compact lists a number of advantages for businesses, people and the planet when companies make the SDGs part of their business, in particular through addressing core corporate functions including their supply chains.

When supply chains are handled well, companies can experience enhanced profitability and shareholder value while reducing costs. They also can engage with a broader group of stakeholders, while contributing to local economic and social development where they and their partners operate. However, when companies do not look for ways to address environmental, social and related corporate governance structures, they are susceptible to operational and regulatory risks as well as to the potential for negative impacts on their social license to operate. Outsourcing production and services does not mean outsourcing risks and responsibilities -- that is, businesses cannot ignore the potential impact of their own consumption practices and sourcing. In addition, outsourcing operations can lead to decreased control, and contribute to a reduced ability to implement sustainable business practices within a supply chain and across a business.

Further, because the 17 SDGs comprise an interconnected group of goals and thus are considered to be interdependent and indivisible, integrating sustainability into a company’s business model has the potential to provide benefits to a number of SDGs simultaneously. From collaboration to traceability to inclusivity along the value chain, addressing the impact supply chains have on the SDGs also can help to unleash new business opportunities and enhance company resilience. For this assessment, each SDG has a series of targets and indicators that companies can look to for guidance on how to prioritize actions to benefit from these opportunities and mitigate the related risks.

Waste matters

One important aspect the SDGs share is the issue of waste management. Packaging waste, for example, is addressed in a number of ways by different SDGs -- most obviously with SDG 12 (responsible consumption and production) but also with SDG 13 (climate action) and SDG 14 (life below water), among others.

These interconnections become apparent with plastics packaging. In 2019, packaging made up 42% of plastic use overall in the world, adding stress to recycling and waste removal systems. To add some context, one estimate on recent trends in plastic use is that without significant change in corporate and consumer behavior, by 2050 there will be more plastics (by weight) than fish in the ocean.

One of SDG 12’s targets -- target 12.5 -- aims to reduce waste generation through prevention, reduction, recycling and reuse of waste (key elements of a circular economy that fosters sustainability). A growing part of the recycling conversation is about eliminating single-use plastics waste. In particular, redesigning products such as packaging with the ultimate goal of phasing out single-use plastics altogether follows the call by the EU to eliminate some single-use plastics by next year. This aim is important because many plastics-producing companies and their petrochemical suppliers tout recycling and waste management as the solution to plastics waste even as research indicates a drastic reduction in plastics production is the overall cure.

Actions for individuals and companies

As employees, we can learn about the impact our places of business have through consumption there, i.e., in decisions on what companies are using in-house, whether cleaning supplies, office supplies, or kitchen supplies. Further, corporate purchasing officers face social and business incentives to learn how to build sustainability along their supply chains as well as with internal consumption decisions and practices. Public procurement officers play a similar fundamental role in ensuring more sustainable purchasing decisions, including for internal consumption of products that align with local, national, and global goals for sustainable supply chains.

The World Business Council for Sustainable Development (WBCSD) recommends that businesses set priorities where they can have the most impact, e.g., in areas where they have the most influence to drive innovation and transformation. To do so, WBCSD offers a 4-step roadmap process for evaluating business impact on the SDGs:

  • Exploring how a company’s supply chain interacts with each of the 17 SDGs

  • Identifying the current positive and negative impacts of these interactions

  • Assessing what the potential related opportunities and risks are

  • Mapping the current positive and negative impacts against the identified opportunities to find the priority focus areas for the company.

Join us in learning more about this topic as Momentum Novum dives into specific sectors and important issues related to companies, supply chains and achieving the SDGs. Coming up next in this series: SDG 12 and detergent supply chains.

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