GITNUX MARKETDATA REPORT 2023

Essential Supply Chain Esg Metrics

Last Updated: October 31, 2023

Written & Summarized by: Jannik Lindner

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Highlights: The Most Important Supply Chain Esg Metrics

1. Environmental Footprint
2. Sustainable Sourcing
3. Greenhouse Gas (GHG) Emissions
4. Renewable Energy Usage
5. Water Usage Efficiency
6. Waste Reduction
7. Labor Practices
8. Human Rights
9. Health and Safety Performance
10. Supplier Diversity
11. Local Engagement
12. Traceability and Transparency
13. Ethical Conduct
14. ESG Risk Management

Supply Chain Esg Metrics: Our Guide

The concept of environmental, social, and governance (ESG) metrics is becoming increasingly important in the world of supply chain management. As businesses pay more attention to sustainable operations, understanding these ESG metrics is vital. In our recent study, we delve deep into the essential ESG metrics that guide supply chain sustainability and contribute to overall business success.

Environmental Footprint

This metric evaluates a supply chain’s environmental impact by measuring carbon emissions, water use, waste generation, and energy consumption at each stage.

Sustainable Sourcing

This metric assesses the share of raw materials from suppliers meeting ESG criteria, including responsible land use, fair labor practices, and ethical conduct.

Greenhouse Gas Emissions

This metric measures the total greenhouse gas emissions throughout the supply chain for goods and services, including production, transportation, and consumption.

Renewable Energy Usage

This metric gauges the use of renewable energy sources by the company and its supply chain partners, promoting cleaner energy and reducing reliance on fossil fuels.

Water Usage Efficiency

This metric tracks the efficiency of water usage in the supply chain, focusing on water consumption reduction, recycling, and the implementation of water-saving technologies.

Waste Reduction

This metric evaluates the company’s efforts to minimize waste generation, encourage recycling, and reduce disposal in landfills or incinerators throughout the supply chain.

Labor Practices

This metric evaluates supply chain labor conditions based on global standards, including fair pay, worker safety, non- discrimination, and freedom to associate.

Human Rights

This metric reviews the supply chain’s compliance with human rights principles, including preventing child labor, eliminating forced labor, and addressing identified human rights abuses.

Health And Safety Performance

This metric measures the frequency and severity of occupational injuries and illnesses among workers along the supply chain, evaluating efforts to improve worker safety and well-being.

Supplier Diversity

This metric assesses the company’s commitment to diverse supplier inclusion, including women-owned, minority-owned, and small and medium enterprises in its procurement process.

Local Engagement

This metric gauges the company’s support for local communities, fostering economic development, job creation, and community relationships through supply chain involvement.

Traceability And Transparency

This metric assesses the company’s capability to transparently track and disclose product origin, processing, and transportation details, ensuring supply chain transparency and accountability.

Ethical Conduct

This metric evaluates supply chain partners’ ethics and compliance with global business standards.

ESG Risk Management

This metric examines the company’s ability to identify, assess, and manage ESG-related risks and opportunities throughout its supply chain, promoting long-term resilience and sustainability.

Frequently Asked Questions

What are Supply Chain ESG Metrics?

Supply Chain ESG (Environmental, Social, and Governance) Metrics are measures used to evaluate a company’s sustainability and ethical practices within its supply chain operations. They help businesses assess and manage risks, enhance their environmental performance, and contribute to society in positive ways.

Why are Supply Chain ESG Metrics important for businesses?

Supply Chain ESG Metrics are important because they promote transparency, ethical practices, and sustainability in business operations. By adhering to these metrics, companies can reduce risks, improve brand reputation, meet compliance requirements, and attract socially conscious investors and customers.

What are some examples of Supply Chain ESG Metrics?

Examples of Supply Chain ESG Metrics include greenhouse gas emissions, waste generated, energy consumption, water usage, supplier diversity, labor policies, product safety, and corporate governance practices. These factors encompass various aspects of environmental, social, and governance considerations throughout the supply chain.

How can companies effectively track and manage Supply Chain ESG Metrics?

Companies can effectively track and manage Supply Chain ESG Metrics by implementing robust data collection and reporting systems, setting realistic goals for improvement, engaging with suppliers and stakeholders, and conducting regular audits and assessments. Additionally, third-party ESG reporting frameworks such as the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB) can provide guidance on measurement and reporting.

How do Supply Chain ESG Metrics impact a company's competitive advantage?

Supply Chain ESG Metrics positively impact a company’s competitive advantage by mitigating risks, reducing costs, boosting innovation, enhancing brand reputation, and fostering customer loyalty. Companies that prioritize sustainability and ethical practices in their supply chain are often more attractive to investors, clients, and talented employees, further contributing to long-term success and growth.

How we write these articles

We have not conducted any studies ourselves. Our article provides a summary of all the statistics and studies available at the time of writing. We are solely presenting a summary, not expressing our own opinion. We have collected all statistics within our internal database. In some cases, we use Artificial Intelligence for formulating the statistics. The articles are updated regularly. See our Editorial Guidelines.

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