Sustainability without silos
12 March 2020
Managing a supply chain is rarely a seamless process. Even as you work toward your business objectives and focus on the bottom line, you also have to set goals, develop systems, and implement practices for corporate responsibility.
By Sofia Perez
Managing a supply chain is rarely a seamless process. Even as you work toward your business objectives and focus on the bottom line, you also have to set goals, develop systems, and implement practices for corporate responsibility. Being a good corporate citizen is not just a nice flourish; it can be essential for establishing and maintaining positive relationships with stakeholders, reducing reputational risk, safeguarding access to markets and finance, and reducing future operational risks to your supply.
But in a world filled with complex environmental and social challenges, it can be hard to know exactly what “good” looks like. Many organizations have worked to establish guidelines for responsible business on various topics. While each of these may be helpful in addressing specific sustainability issues, they are not always aligned, and their application in context is not always clear. It can be challenging to integrate numerous such tools and approaches into company operations and supply chains in a coherent way.
Fortunately, you don’t have to figure it all out on your own. A coalition of leading conservation and human rights NGOs came together to develop the Accountability Framework to solve exactly this challenge. Published in mid-2019, the Framework unites numerous norms and guidelines related to addressing deforestation, ecosystem protection, and human rights—and helps companies knit them into a single and effective set of responsible business practices, regardless of a company’s position in the supply chain.
There is clear value in jointly managing environmental and social issues in supply chains because they are often so closely linked. For example, conversion of forests to plantation crops not only constitutes deforestation; it may also displace or negatively affect human rights of indigenous peoples. In other cases, however, strict forest protection might be at odds with communities’ legitimate land use plans. Such scenarios can present challenges for companies that have committed to safeguard against both social and environmental harms. As Vanessa Jimenez, senior attorney for Forest Peoples Programme, a founding member of the Accountability Framework initiative, explains, “You can’t claim to have an ethical supply chain if you are avoiding deforestation but at the same time taking land from indigenous peoples or abusing workers.”
By design, the Framework weaves together environmental and social issues that are too often siloed. “The coalition members that led the development of the Framework come from human rights and social interest groups. They come from environmental groups,” says Jimenez. “With one voice we’re telling companies that when we talk about ethical supply chains, we mean protecting both people and the environment. It’s not one or the other.”
As important as it is to clarify norms for ethical supply chains in a way that fully integrates environmental and social concerns, the greater challenge is implementing these norms across vast company operations and far-flung supply chains. These challenges can be magnified by the separation in company teams, external standards, auditing systems, and other tools to address environmental versus social issues. “I go into companies that have very strong environmental programmes but younger human rights programmes. There is actually internal division,” says Youssuf Aftab, a sustainability lawyer and principal of Enodo Rights, which offers legal expertise on human rights issues. “The two departments don’t talk to one another… there’s a real siloing of these issues.” This separation can lead to major inefficiencies as well as missed opportunities to develop lasting sustainability solutions.
To address these challenges, the Accountability Framework fully integrates both environmental and human rights perspectives into the guidance it provides on each of the many aspects of how to implement an ethical supply chain. These aspects include systems for due diligence, traceability, supply chain management, monitoring, auditing, and reporting; as companies are establishing or improving these systems, they can develop approaches that simultaneously address several key environmental, social, and governance (ESG) issues. This improves efficiency, avoids duplicative or misaligned business processes, and promotes strong awareness of environmental and social responsibility across the supply chain. “It is one of the great contributions of a Framework that is talking about human rights and environmental issues together,” adds Aftab, one that offers “very specific guidance on what needs to be done.”
In the past, you might have put in the time and resources to develop and implement environmental or social policies, only to find that these approaches did not line up with the expectations of NGOs that scrutinize or even campaign against companies like yours.
As the product of consensus among the members of a diverse NGO coalition, the Accountability Framework unifies the messages of these respected civil society organizations to provide a clear guide to policies and practices that are accepted by these organizations and many others. The Framework’s guidance also aligns with the most relevant and widely accepted international norms on the topics that it addresses. These include the UN Sustainable Development Goals (SDGs), UN Guiding Principles on Business and Human Rights (UNGP), International Labor Organization (ILO) conventions, and the New York Declaration on Forests (NYDF).
Finally, the Framework incorporates input from investors, leading companies, and other key stakeholders who participated in its creation. Since the Framework also reflects the priorities of these actors, its guidance can help your company address the kinds of expectations and requests that you’re likely to receive from buyers, investors, and lenders.
Just like achieving any business objective, getting to “good” takes effort. The Accountability Framework can help you weave together social and environmental best practices to create an ethical supply chain that meets the expectations of diverse stakeholders and is durable enough to last.
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