Companies and industries strongly engaged in Corporate Social Responsibility (CSR) have taken significant steps in their sourcing policies to reduce unethical and inhuman working conditions by controlling their subcontractors along the supply chain. Until now, the primary focus has been on working conditions, but CSR also encompasses environmental concerns as part of a global sustainability approach. In the last few years, environmental concerns have largely been raised by third parties, whether NGOs, media, or anyone else not directly involved in supply chains.
Improving environmental conditions in a global supply chain is complex. Developing countries are at differing stages of industrialization. Local regulatory frameworks usually vary considerably from country to country and law enforcement is often weak. Also, environmental concerns can be very different from one industry to another.
For all these reasons, building a global environmental improvement program applicable to different countries and industries can be a real challenge. Last but not least, retailers and brands do not always have the power to force changes on their suppliers. Therefore, it is necessary to obtain suppliers’ buy-in.
First Steps have been Taken
Initiatives such as the GSCP (Global Social Compliance Program) or the FTA (Foreign Trade Association) have been started in order to tackle this area. They were created by and for global buying companies wishing to improve the environmental footprint of their supply base. Several levels or approaches are under consideration:
- Basic compliance with environmental legal requirements, such as laws, directives, and policies dealing with classic concerns (GHG, resource preservation, pollution prevention etc.)
- Legal compliance along with proactive management leading to operational excellence and implementation of good practices.
- Pursuit of improvement, support from an independent party, working on new management systems to enhance environmental performance and integration into society.
The assessment of suppliers includes every potential environmental impact and compliance against local regulations. This conformity assessment allows distributors and importers to set up the baseline for an improvement process, and to define a road map in the short or long term, to reach conformity level and above.
How to motivate your supply chain?
It’s important that suppliers / manufacturers are supported and prompted to increase their awareness of environmental regulations before implementing any action plan. A possible approach to supporting suppliers/manufacturers in improving environmental conditions would include the following two steps:
- THE ASSESSMENT PROCESS – this begins with a self-assessment implemented by the producer itself, through a specific questionnaire followed by a critical review from a third party. The supplier situation can then be specifically evaluated, to enable sorting and ranking of suppliers according to environmental risk profiles. Then, an on-site audit is conducted to identify gaps compared with local requirements and buyers’ policies. It helps suppliers to identify and prioritise actions to reach the expected conformity level.
- THE IMPROVEMENT PROCESS – after the assessment phase, there is the opportunity to support suppliers through a continuous improvement programme, beyond conformity level, adapted to the production site and tailored to suppliers’ commitment and engagement. A variety of modules of training and support are offered by third parties and adapted to satisfy the specific needs of suppliers; there are options of classroom training with delivery of in-depth knowledge of the conformity requirements, for suppliers with all kinds of environmental risk levels. There is also individual support available, including regular onsite visits, workshops, and follow-up of regulation relative to non-compliances detected while auditing, preferably for medium- and high-risk suppliers.
The overall assessment and improvement phases can last from two to four months, depending on supplier readiness.
As SGS is involved in CSR-oriented services and solutions, we are proposing a new assessment service for environmental conditions at production sites. Along with initiatives references, SGS has developed this service to be offered in line with the approach described above, which includes the following three main steps:
- An environmental compliance assessment
- A compliance and continuous improvement assessment (i.e. on proactive management)
- Support to suppliers to achieve conformity level and/or to improve their environmental footprint.
For more information on SGS support with environmental assessments, please contact:
Social Responsibility Solutions
SGS Consumer Testing Services
t: +33 1 41 24 87 26
SGS is the world’s leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 75,000 employees, SGS operates a network of over 1,500 offices and laboratories around the world.