Voices in Supply Chains

Large corporations are setting stronger sustainability goals with ambitious carbon-reduction targets. This corporate push for enhanced climate action is essential to creating a zero-carbon economy. However, many of the tangible changes needed to meet these companies’ targets — such as reducing product-driven deforestation and factory emissions — must be undertaken by smaller businesses throughout their supply chains. These suppliers are typically micro, small or medium-sized enterprises (MSMEs) that often lack the resources needed to address their environmental impacts and the threat climate change poses to their operations.

The following stories highlight challenges that supply chain businesses and workers are facing in this changing environment, as well as the benefits of corporate partnering to address their needs.

COVID-19 exposed the difficulties and vulnerabilities in complex global supply chains. Other challenges, including climate-driven events like storms and heat waves, continue to create major disruptions. Meanwhile, consumers are increasingly seeking more sustainable products, governments are mandating traceability, and companies are demanding more information and lower costs from suppliers.

These shifts are putting growing pressure on businesses and people in supply chains, particularly those working in micro, small and medium-sized businesses. 

Yet, there are obvious power imbalances in global supply chains. At the top are often global, multi-billion-dollar companies with their own needs, risks and challenges. These large companies hold the power while smaller businesses in their supply chains frequently struggle to keep up with evolving business needs and best practices as well as threats like climate change.

Supply chains are also vast, confusing, and tangled networks that can be difficult to trace from beginning to end.

Even market-leading companies do not always know who exactly contributes to making their products — nor the types of conditions that affect those businesses, workers and communities.

This means that companies may not fully understand the risks and challenges that their suppliers face or how to best support them in addressing those challenges.

As the impacts of climate change continue to affect businesses around the world, large companies need to invest in their supply chains to help create more resilience. Before doing so, companies must connect with suppliers to understand what exactly their challenges are and how to best address them.