In today’s interconnected world, companies are evaluated not just on the quality of their products but on the ethics and sustainability of their entire supply chain. Rising climate urgency and consumer demand for transparency are forcing businesses to prioritise efficient, eco-friendly practices - from the ethical sourcing of raw materials to minimising environmental footprints. Supply chains must now balance efficiency and cost with accountability, reflecting a global shift toward holistic sustainability as a core business imperative.
So, where do you begin? Here are the essential steps every business can take to embed sustainability into the heart of their supply chain.
Build a clear business case for sustainability
Modern consumers are pulling back the curtain and asking important questions: Who is producing this product? Are the materials used in production eco-friendly? What are the environmental and social costs related to the product? The market data is quite revealing:
Beyond customer demand, sustainable supply chains help businesses reduce costs, boost resilience and unlock innovation. For example, Unilever’s Sustainable Living Plan cut supply chain emissions by 30% and helped its sustainable brands grow 69% faster than others in the portfolio. (Business Case for Sustainable Supply Chains: Success Strategies).
Map your supply chain – know where you stand
You can't manage what you don't measure. It is important to map your supply chain: you should begin by determining its boundaries. This includes not only your direct suppliers (tier 1) but also those further upstream (tier 2, tier 3 etc.). Gather data across all tiers of your supply chain. Key information includes supplier location, materials and products sourced, manufacturing processes and logistics involved, energy usage, emissions, waste generation, labour practices, community impact and compliance with human rights standards. This data provides the visibility needed to identify risks, opportunities and areas for improvement.
Assess risks and opportunities
Once you have gathered the data, evaluate it to identify:
Measure your carbon footprint
Once you understand your supply chain structure, the next step is to quantify your carbon emissions related to the supply chain. Emissions are generally broken down into three scopes:
Create a sustainable sourcing policy
The next step is to establish criteria for selecting and evaluating suppliers based on their sustainability performance. These should include supplier commitments and impact on:
Engage suppliers and build a green network
Sustainability is a shared responsibility. It is important to engage with suppliers to communicate your sustainability expectations and collaborate on initiatives to improve practices. This can include joint efforts to reduce emissions, enhance resource efficiency and ensure ethical labour practices. It is important to request from your vendors their sustainability policies, net-zero ambitions and decarbonisation plans. Building strong, transparent relationships fosters mutual commitment to sustainability goals. You cannot build a sustainable supply chain alone. It requires strong, transparent relationships with your suppliers.
Cut waste at every stage
Sustainability in the supply chain isn’t just about sourcing - it’s about how you operate, too. Production waste should be significantly reduced by:
Use technology to boost transparency
Technology is one of your key enablers in building a traceable, transparent supply chain. Blockchain is a game-changer - it allows real-time, tamper-proof tracking of products from origin to consumer. With blockchain, companies can confirm the authenticity and sustainability of raw materials, reduce fraud and build consumer trust. Walmart, for instance, has implemented blockchain to track fresh produce and ensure ethical sourcing across its supply chain.
Share your story – be transparent
Sustainability progresses well if all players in the value chain influence each other towards the same goal. Today’s consumers expect transparency - and they reward it. This is why you should disclose and report your product carbon footprints, net zero target, percentage of renewable energy used in production, ethical sourcing certifications and recyclability instructions. By telling your credible sustainability story, you create deeper trust with stakeholders.
Conclusion:
Achieving a sustainable supply chain isn’t just about ticking boxes, it’s about building a smarter, stronger, more responsible business. By embedding sustainability into every link of your supply chain - from sourcing to production to partnerships - you’re not only helping the planet but also unlocking long-term competitive advantage. Authentic sustainability goes beyond the final product - it lives in every step that got it there.
BDO supports organisations that want to identify risks and opportunities associated with their supply chain, going on to define their proper management and to integrate the sustainability strategy through responsible business conduct and human rights, together with analysis and management of the supply chain. Find out about how BDO can help, specifically around activating your Sustainability journey and Supply Chain Due Diligence. Please also feel free to reach out to our BDO sustainability experts tagged on this page for more information about your sustainability needs.
Author: Charles Tungwarara
Head of Business Process, ESG & Sustainability, BDO UAE
So, where do you begin? Here are the essential steps every business can take to embed sustainability into the heart of their supply chain.
Build a clear business case for sustainability
Modern consumers are pulling back the curtain and asking important questions: Who is producing this product? Are the materials used in production eco-friendly? What are the environmental and social costs related to the product? The market data is quite revealing:
- 66% of global consumers are willing to pay more for sustainable products
- 73% of Gen Z and Millennials prioritise sustainability over brand loyalty.
Beyond customer demand, sustainable supply chains help businesses reduce costs, boost resilience and unlock innovation. For example, Unilever’s Sustainable Living Plan cut supply chain emissions by 30% and helped its sustainable brands grow 69% faster than others in the portfolio. (Business Case for Sustainable Supply Chains: Success Strategies).
Map your supply chain – know where you stand
You can't manage what you don't measure. It is important to map your supply chain: you should begin by determining its boundaries. This includes not only your direct suppliers (tier 1) but also those further upstream (tier 2, tier 3 etc.). Gather data across all tiers of your supply chain. Key information includes supplier location, materials and products sourced, manufacturing processes and logistics involved, energy usage, emissions, waste generation, labour practices, community impact and compliance with human rights standards. This data provides the visibility needed to identify risks, opportunities and areas for improvement.
Assess risks and opportunities
Once you have gathered the data, evaluate it to identify:
- Environmental risks: high emissions, resource depletion and waste generation
- Social risks: poor labour conditions, human rights violations and community impact
- Compliance risks: non-adherence to regulations and standards.
Measure your carbon footprint
Once you understand your supply chain structure, the next step is to quantify your carbon emissions related to the supply chain. Emissions are generally broken down into three scopes:
- Scope 1: direct emissions from company-owned operations
- Scope 2: indirect emissions from purchased electricity, heating and cooling
- Scope 3: all other indirect emissions - including suppliers, logistics and product use.
Create a sustainable sourcing policy
The next step is to establish criteria for selecting and evaluating suppliers based on their sustainability performance. These should include supplier commitments and impact on:
- Environment: energy usage, waste management, emissions and resource conservation
- Society: labour practices, community engagement and adherence to human rights standards
- Ethics: anti-corruption measures, transparency and compliance with relevant regulations.
Engage suppliers and build a green network
Sustainability is a shared responsibility. It is important to engage with suppliers to communicate your sustainability expectations and collaborate on initiatives to improve practices. This can include joint efforts to reduce emissions, enhance resource efficiency and ensure ethical labour practices. It is important to request from your vendors their sustainability policies, net-zero ambitions and decarbonisation plans. Building strong, transparent relationships fosters mutual commitment to sustainability goals. You cannot build a sustainable supply chain alone. It requires strong, transparent relationships with your suppliers.
Cut waste at every stage
Sustainability in the supply chain isn’t just about sourcing - it’s about how you operate, too. Production waste should be significantly reduced by:
- Investing in renewable energy sources
- Applying lean manufacturing principles
- Designing products for circularity (repair, reuse, recycle)
- Upcycling by-products or launching take-back programmes to keep materials in use longer.
Use technology to boost transparency
Technology is one of your key enablers in building a traceable, transparent supply chain. Blockchain is a game-changer - it allows real-time, tamper-proof tracking of products from origin to consumer. With blockchain, companies can confirm the authenticity and sustainability of raw materials, reduce fraud and build consumer trust. Walmart, for instance, has implemented blockchain to track fresh produce and ensure ethical sourcing across its supply chain.
Share your story – be transparent
Sustainability progresses well if all players in the value chain influence each other towards the same goal. Today’s consumers expect transparency - and they reward it. This is why you should disclose and report your product carbon footprints, net zero target, percentage of renewable energy used in production, ethical sourcing certifications and recyclability instructions. By telling your credible sustainability story, you create deeper trust with stakeholders.
Conclusion:
Achieving a sustainable supply chain isn’t just about ticking boxes, it’s about building a smarter, stronger, more responsible business. By embedding sustainability into every link of your supply chain - from sourcing to production to partnerships - you’re not only helping the planet but also unlocking long-term competitive advantage. Authentic sustainability goes beyond the final product - it lives in every step that got it there.
BDO supports organisations that want to identify risks and opportunities associated with their supply chain, going on to define their proper management and to integrate the sustainability strategy through responsible business conduct and human rights, together with analysis and management of the supply chain. Find out about how BDO can help, specifically around activating your Sustainability journey and Supply Chain Due Diligence. Please also feel free to reach out to our BDO sustainability experts tagged on this page for more information about your sustainability needs.
Author: Charles Tungwarara
Head of Business Process, ESG & Sustainability, BDO UAE