Climate change: Corporate sustainability in the supply chain

By Timothy M. Smith | May 1, 2013

Traditionally, corporate sustainability efforts have focused on the direct impacts of a company’s waste or the emissions associated with its operations, buildings, and vehicles. However, the majority of the US economy’s climate, water, and pollution impacts are the result of complex supply chains, strung together to deliver value-added products and services. To mitigate these indirect impacts (by reducing greenhouse gas emissions, for example) and adapt to new risks, leading companies must engage with upstream suppliers and embed sustainability as a joint objective. Companies failing to do so may suffer damage to their reputations and operations. In a changing climate, increasingly frequent and severe weather events are making supply networks more vulnerable to disruptions and unanticipated costs. Investors and other stakeholders are responding by pressuring companies to disclose and quantify emissions and other supply chain environmental impacts. Despite significant progress made by some corporations in reducing their emissions and their exposure to potential hazards hidden in upstream operations, sustainability must be a society-wide effort.

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