No More Excuses, Corporate America: The Future Is Now
Well! In times awash with nothing but bad bad bad news on environmental matters, I have some very positive news to share from China.
My favorite environmental NGO in that country, the Institute for Public and Environmental Affairs (IPE), has just released its annual Green Supply Chain report—which is a mind blower. As it has done since 2014, IPE has scored a large number of high profile multi-national corporations for their supply chain responsibility, with evaluation criteria covering the level of responsiveness and transparency these corporations have in place, as well as the breadth and depth of their supplier oversight. The top three ranked companies—Apple, Dell, and Levi’s—were also top three in the 2017 rankings and deserve to take a bow. New companies of note rose to the top ten this year; congratulations to C&A, Nike, Primark, H&M, Samsung, Inditex, and Target. I’m proud of you for your excellent performance this past year!
Bottom dwellers scoring zero again (and again and again every year), what can I say. You dwell in my Hall of Shame. It is beyond time for you to get moving.
Even more exciting than the annual scores, however, are a few 2018 innovations from IPE to drive additional progress—new tools now up and running that support new levels of supply chain responsibility, and the early uptake/adoption/use of those tools by some key brands.
I’m particularly excited about two: IPE’s Brand Map, that divulges which factories are in the supply chain of particular multinationals and its Blue Eco-Chain tool, which provides push notifications to participating brands when compliance problems surface in suppliers registered in the program. Wow, welcome to the 21st century, where real time pollution data is collected and displayed in user friendly formats, serving up the salient information both corporations and customers need to evaluate environmental responsibility on a silver platter.
Eleven companies deserve special recognition as first movers onto the brand map—all but one from the apparel sector: Target, Gap, Puma, Nike, Esprit, Inditex, New Balance, Tesco, Adidas, Levi’s, and Samsung.
What are these brands thinking, you may be asking yourself, by putting themselves out there on the identity of their suppliers to the world, linked to real time data on their environmental compliance? Well, as one explained to me: brands spend considerable sums to audit environmental performance of their suppliers, and can afford to do so with a frequency of only once or twice a year. But, even if these audits were theoretically unannounced (and many are not!), brands are concerned that the suppliers may have cleaned up their acts just for the visit, only to return to less responsible behavior soon after the audit is complete. Participation on the brand map allows serious brands to deliver the message to their suppliers that their ongoing, daily environmental performance really matters: their brand’s logo and public reputation are now resting on it! So if a problem arises, there is no benefit in hiding it; the brand and supplier can instead work together to solve the problem.
Similarly, on the second innovation this year from IPE for greening supply chain: the Blue Eco Chain push notification system. Use of this tool does not require publicizing the list of factories in the supply chain but instead can be used more “quietly” for those companies not yet prepared to go public on that front. With this breakthrough tool, brands need no longer review their list of suppliers manually for compliance status—instead they have the luxury of automatic notification when something goes awry. What a big deal, facilitating supply chain oversight at a whole new level! I am delighted to see that 38 companies are using this new tool, which represents such an important breakthrough to modern day supply chain oversight programs. Hope I can report more than 38 more by next year.
Finally, in the last but certainly not least category: results! All of this work is delivering an accelerating pace of impressive improvements in industrial pollution in China. IPE reports a huge increase in the cumulative number of suppliers pushed by brands to respond to environmental violations: 2130 factories as of October 2018, compared to 540 factories only 3 years ago. Of these, 1206 factories have fully rectified their situation and passed a third party audit by Green Choice Alliance, a coalition of green NGOs led by IPE.
IPE, now please take a deep bow yourself for this incredible contribution to environmental protection in China.