Supply chains must collaborate to combat climate risk
Written by Accenture, the CDP Global Supply Chain Report 2014, ‘Collaborative Action on Climate Risk’, details how leading companies are managing the significant risk that climate change poses to global supply chains.
According to the report, suppliers report that both climate risk and opportunity are at high levels: 72% identify a current or future risk related to climate change; 56% of companies identifying climate change related opportunities say that consumers are becoming more receptive to low-carbon products and services.
While suppliers realized savings of $11.5 billion from emissions reduction investments in 2013, regulatory uncertainty is making companies cautious about investing in emissions reductions and supply chain sustainability. Seven of the ten sectors report investment falling from 2012 or 2011 levels. They are also increasingly focusing on investments with shorter payback periods, which tend to deliver only incremental benefits.
Collaboration is at the very heart of supply chain sustainability – and it yields results according to the report. Those companies that engage with two or more suppliers, consumers or other partners are more than twice as likely to see a financial return from their emissions reductions investments, and almost twice as likely to reduce emissions than those who don’t engage with their value chain.
According to the report, companies also need to:
–Ensure they have the internal capacity to identify climate change risks and opportunities
–Motivate their employees to deliver on their objectives.
–Get governance right, by integrating climate change into business strategy
–Engage employees, invest in employee engagement and incentive programs
–Support suppliers to help address the growing gap between company and supplier emissions reduction performance
–Communicate progress
–Take a wider view of supply chain sustainability
–Invest in resource efficiency
–Look to reduce commodity inputs across the board to deliver carbon and cost reduction
–Engage more with policymakers and those that do deliver better emissions reduction performance
Click here to view the complete report.
