Firms 'didn't ditch green goals during Covid'

20 July 2021

Large companies are maintaining supply chain sustainability commitments despite fears they would be ditched due to Covid-19-related economic pressures, according to a survey.

In fact the study, by the Massachusetts Institute of Technology’s Center for Transportation and Logistics and the Council of Supply Chain Management Professionals, said many firms paid more attention to social issues such as worker welfare and supplier diversity in 2020 than 2019.

Eight in 10 (83%) respondents said Covid‑19 had either accelerated supply chain sustainability activity or increased awareness of it.

The survey polled more than 2,400 supply chain executives in the manufacturing, transportation and warehousing, business consulting, and retail sectors, mainly from North American and European companies.

But while the report found overall greater commitment to sustainability goals compared to 2019, most of the improvement came from large (1,000–10,000 employees) or very large (10,000 plus employees) companies.

“Small and medium-sized companies were more likely to pull back, with more enterprises in this category indicating they were not engaged before the pandemic and even less so during the crisis likely due to strained financial resources,” said the report.

“An important goal is to gain a better understanding of the critical barriers that prevent small and mid-size enterprises from adopting sustainability and how these enterprises can be engaged.”

One in 10 (9%) respondents said their companies’ commitments to supply chain sustainability goals weakened in 2020 compared to 2019.

However the number of respondents rating employee welfare and safety as a priority for their organisations rose by 10% from 2019. The number that considered supplier diversity, equity and inclusion to be a priority increased 5%.

Respondents also said their focus on climate change mitigation and supply chain circularity – which includes the use of recyclable materials – fell by 3% and 5% respectively from 2019.

The report said while investments in energy savings and renewables had helped companies achieve emissions reductions in supply chains, harder challenges, such as decarbonising ocean shipping, lie ahead.

Professor Yossi Sheffi, director of the MIT Center for Transportation and Logistics, said: “Our initial results suggest that sustainability did not drop as much as we anticipated.

“The key question will be whether supply chain sustainability remains a tack-on to existing CSR efforts or if it can be embedded strategically to drive risk management and opportunities that more concretely contribute to climate change mitigation.”

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