Are Your Global Supply Chains Sustainable?

The world can become – and is becoming – increasingly reliant on technology, but the core of any businesses’ supply chain remains interaction and communication. Getting these elements right is fundamental to maintaining a sustainable supply chain.

Risk Exposure in Your Supply Chain

All businesses, regardless of the industry they work in, are becoming increasingly exposed to risk across their supply chains, either by disruption resulting from climate change, reputational damage, or many other risks that come with the international expansion of business in a globalised world.

This makes it more likely that businesses will face exposure to ethical issues, at some point along their supply chain. It is a company’s responsibility to ensure the risk of this happening remains as low as possible, and that when it does, systems are in place to fix issues, learn from them, and move on in a more vigilant and compliant manner.

One of the biggest challenges for expanding your business abroad is the growing concern from consumers around ethical practices. Consumers in and beyond Europe now want to be informed about the ecological and social context of products before purchasing them; using their purchasing power to wield their environmental and ethical concerns. More and more British consumers prefer to buy recycled, genetically modified-free, Fair Trade and eco-friendly – and they want to ensure they’re doing this through every part of a company’s supply chain.

While this is ultimately a positive development, it can put increased pressure on companies to ensure there is no overlooked issues along their supply chain. Due diligence and oversight should always be a crucial part of any supply chain, and the added incentive of retaining customer support can help to ensure that these are implemented.

Minimising Risks, Maximising Best Practices

If you’re looking to go global, the risks involved concerning consumers are also compounded by an increasingly competitive market, and the subsequent pressures to keep costs, and, ultimately, prices, competitive. As well as this, customers have an increasing desire for low-price products, too, as companies must ensure they are not unintentionally purchasing counterfeits, for example.

These ethical issues include giving producers fair wages and good working conditions. It is important to ensure that workers along your supply chain are seeing an adequate share of the wealth creation. You must also guarantee fair treatment to producers, as well as navigate exclusive territories. Responsibilities to retailers include truthful packaging and labelling, ensuring no false advertising.

And in an increasingly globalised world marketplace, businesses must be confident their supply chains are resilient, and stay abreast of unethical practices in their factories, which may be at the other side of the world. In the office, it’s much easier to quantify, communicate and measure sustainability, as well as discuss and get to the bottom of differences in opinion.

In order to strengthen this across the business, and subsequently through the supply chain, some experts advise making the language of sustainability relevant to the boardroom, by simply putting it into context.

This will help employers see the importance of being ethical and sustainable, rather than seeing these as abstract issues. Then, this can be implemented more strongly across the company and along supply chains.

Another way to ensure a sustainable, ethical business is to enforce it from the very beginning; by not consciously going into any agreements were there are any doubts, where it can’t be fully guaranteed that the company isn’t taking on risks that could be damaging to our reputation’. One way this can be achieved is by devising and clearly communicating certain standards from suppliers are required to be met. Once again, due diligence is key.

If you’re looking to expand business internationally, you may want to consider getting

advice and support from international expansion experts such as Galvin International, who

can help you through every step of the process.

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