SDG #11 Make cities and human settlements inclusive, safe, resilient and sustainable
A company’s entire supply chain can make a significant impact in promoting human rights, fair labour practices, environmental progress and anti-corruption policies.
However, UN Global Compact participants rank supply chain practices as the biggest challenge to improving their sustainability performance. Extending the UN Global Compact’s Ten Principles into the supply chain can be difficult because of the scale and complexity of many supply chains.
Why should business support SDG11?
Businesses are core of urban development, supply and services to urban populations. They are well positioned to deliver on Goal 11’s promise of universal access to quality housing, transport, green, and cultural heritage, in collaboration with governments and municipalities.
The UN Global Compact encourages companies to make sustainability a priority from the top of the organization. If the chief executive sees the supply chain as an extension of their workforce and community, the company can set expectations for best practices across its supply chain. These can include key areas such as selection, training, auditing and remediation.
Doing so promotes a broader understanding within an organization of how decisions made, beyond procurement, can affect the supply chain. For example, legal staff, product developers and marketing – all can have an impact. In addition, companies must look at their supply chain and consider the suppliers that may have the most significant challenges to address.
Why should business support SDG12?
Corporate supply chains are bigger and more complex than ever before. Open markets have enabled companies to source materials and outsource production to suppliers in developing and emerging economies. When done right, this can deliver significant benefits to companies in the form of reduced costs and enhanced profitability and shareholder value. It can also contribute to much needed economic and social development, resulting in higher standards of living for millions of people.
Done wrong, however, by not taking into consideration the environmental, social and governance (ESG) performance of suppliers, companies leave themselves open to significant operational and reputational risks. Impacts to people and environment can also be substantial and severe.
Successful supply chain managers must think beyond short-term financial considerations to build relationships that can deliver long-term value along the entire supply chain. This includes incorporating sustainability issues into the company’s sourcing and purchasing practices. Companies that incorporate ESG considerations into supply chain management can deliver a range of business benefits, including:
- Better anticipation and management of risks, as risk is spread out across different players.
- Reduced operational risks such as disruption to supply, increased cost and lack of access to key raw materials.
- “Informal” or “social” license to operate within communities, legal systems and governments that otherwise might be antagonistic.
- Reduced costs and enhanced efficiency and productivity.
- Improved working conditions, which can reduce turnover and improve quality and reliability.
- Improved efficiency and profitability as a result of increased environmental responsibility.
- Protection of corporate brand and values, and enhanced consumer confidence and loyalty.
- Greater process and product innovation uncovered by empowered suppliers.
- Potential increase in shareholder value as shown by examples from leading companies with good supply chain management.
So, what can You and your company do?
Below I give you some examples of business actions that You and your company can take:
Design and adopt a responsible, circular business model.Example:A developer leads a consortium managing “living buildings” that are adaptable to different uses, using cradle-to-cradle principles for building materials, and technologies to make the buildings energy-positive.
Significantly narrow or close material and energy loops across own and supply chain operations.Example:A hotel company coordinates across its supply chain to eliminate wastewater discharge and air pollution near UNESCO World Heritage sites.
Support access to essential services across the workplace, marketplace, and CommunityExample:A brewery, partners with businesses, government, and research institutions to build a zero-waste brewery that aims to extract high-value products such as bread, biogas, mushrooms, and nutrients used in aquaculture from biomass residues from beer production
Shift to a portfolio of goods and services that require and promote negligible use of resources and produce negligible waste.Example:A home appliance company designs smart consumer products which lower energy use by recognizing consumption patterns and automatically turning off, supporting state-of-the-art energy efficiency.
Develop, implement, and share solutions for tracing and reporting on sustainability of production and consumption across end-to-end operations and impact on surrounding communities.Example:A restaurant chain deploys a cloud-based software tracking system to document pathways for all agricultural inputs, inform quality assessments and guarantee sustainable practices throughout its supply chain.