Supply Chain Sustainability Has No Canon

This growing pressure to invest in supply chain sustainability manifests itself in firms’ goals and investments among the many focal areas within the umbrella term of supply chain sustainability. For our report, we identify 10 issue areas (five environmental, five social). See Figures 4 and 5.

Supply chain sustainability appears to have no canonical priorities. That is, there appears to be no central core of environmental or social issues that always take clear precedence over the others. Rather, over four years of observation, we see some surges and plateaus in importance. These dynamics are evident among both environmental and social issues. As examples, supplier diversity, equity, and inclusion (DEI) and natural resource protection stand out as especially ascendant over the last four years, while supply chain circularity and fair pay/fair trade programs have been comparatively stagnant in our observation.

But where environmental and social dimensions of sustainability do show different patterns from one another is in the gap between firms’ self-reported goals and their investments in achieving them. Figure 6 compares the average difference each year between all respondents’ goals and investments grouped into environmental and social issues. Positive scores along the y-axis of Figure 6 would indicate that respondents’ aggregated self-reported investment evaluations exceed their self-reported goal estimates for grouped sustainability topics.

Conversely, negative scores along the y-axis of Figure 6 indicate that self-reported goals exceed self-reported investments. In all issues, goals exceed investment, which is to be expected. But in the early years of our survey, the gap between goals and investments was wider for social issues than for environmental issues. That difference appears to have narrowed to a similar magnitude over the last four years.

Social policies have grown significantly over the past few years driven by societal movements that have driven focus on diversity, equity, inclusion, individual health, and well-being. Company executives, investors and HR teams are focused on implementing social programs to ensure happier and healthier employees to meet this growing societal demand. People also wish to work in environments that focus on the whole person, and not just the well-being of the company.

Taylor Allis, Chief Product and Marketing Officer, Avetta

Figure 4: Goal change from 2020–2023

Figure 5: Investment change from 2020–2023

Figure 6: Supply chain sustainability goals versus investment, 2020–2023