Supply chain sustainability includes planning and executing environmentally responsible business practices within the end-to-end supply chain. These include sustainability commitments such as responsible sourcing, greenhouse gas emissions reductions, renewable energy usage in operations, and reduction or elimination of waste sent to landfill.

Sustainability expectations around the value supply chains deliver are accelerating amid ongoing volatility, disruption and gridlock. As impacts from the pandemic, global conflict, climate change and other factors continue, supply chain leaders must be ready to mitigate risk and navigate uncertainty in an increasingly dynamic and challenging environment.

Supply chain sustainability objectives include meeting growing customer expectations for social and environmental sustainability, maximizing business impact and creating a competitive advantage by shifting away from discrete projects toward transformational change.

The elements of supply chain sustainability include economic, social and environmental impacts:

• Economic — Impacts to human communities and economic systems.
• Environmental — Impacts to the earth’s resources.
• Social — Impacts to people and human rights.

To become truly sustainable, supply chains must first overcome four major barriers that promote incrementalism and inhibit sustainability transformation. These include enterprise knowledge gaps, significant upfront costs, mixed customer signals and partners’ barriers to transformation. To overcome these, supply chain leaders should:

• Foster a culture of experimentation by enabling staff to conduct minimal, iterative tests of potential sustainability approaches to close the gap in knowledge.

• Develop cost-sharing agreements with partners in your ecosystem and beyond to achieve sustainability goals and reduce upfront costs to sustainability.

• Nudge customers to send clear signals about the importance of sustainability, thereby allowing supply chains to make a strong business case for transformational improvements.

• Coordinate sustainability communications and resources across the ecosystem to mitigate partners’ own barriers to transformation and enable achievement of sustainability goals.