Sustainability governance for commodity supply chains has seen rapid advances over the last few years and the momentum behind various ESG movements is strong. However, it’s now time to distill this momentum into actions with measurable, lasting impacts. Implementing and insisting upon supply chain transparency in global commodity firms now can be extremely beneficial in the long-term, as it is slowly but surely becoming a business imperative.
An ESG strategy fit for a commodity firm
For a commodity firm to implement a successful sustainability strategy, they first need a clear implementation strategy. This means beginning with clear, measurable impacts and benchmarks. Much of the criticism for ESG initiatives stems from the fact that there are currently very few standards for what is considered ‘sustainable.’ Therefore, having metrics for sustainability within your business that you can present to investors and shareholders is extremely important.
Set the bar high for standards of ESG and you’ll set yourself up for the future. Commit to goals that are specific, measurable, achievable, and time-bound. For example, it could even be as simple as eliminating single-use plastics from your supply chain by 2030. This may seem like a negligible step, but it’s better to demonstrate the ability to meet smaller goals, but more of them, rather than aim for lofty and unattainable ones.
The sustainability imperative
Supply chains are embedded in a wider societal context, something that commodity firms must remember as they embark upon making their supply chain more ethical and more transparent. International commodity trade is becoming increasingly common, and therefore it’s becoming ever-clearer that market trends and developments in one small corner of the world can have lasting ripple effect on a region thousands of miles away.
There is also growing demand for commodities in developing countries, but the complexity of material and monetary flows can have a myriad of effects on local communities, like displacement and hazardous waste production. For this reason, it’s crucial that commodity firms re-evaluate their supply chains as they expand for ethical sourcing and ensure they are aware of the side effects of production.
The push for transparent supply chains has unmasked a number of sustainable production practices and demystified commodities supply chains across the globe. This has generated more momentum behind the movement, but this has had a number of unwanted side effects. Trying to make supply chain transparent, especially when they are complex like those in commodities, can result in the oversimplification of the process.
Building a talent bench
Attracting new, top-quality talent is a challenge for everyone right now, but it may be time to begin your search for a Chief Sustainability Officer. The value of this role cannot be understated if you are serious about your undertaking into creating a strong and deliverable ESG plan for your business. Bringing in a CSO who has the knowledge and network to help design and implement your vision is the best way to achieve your goals.
However, demand for such individuals is slowly picking up and will likely gather momentum as most businesses look to make this transformation sooner rather than later. It’s advisable to begin your search for a sustainability consultant as soon as possible.
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