The United Nations Global Compact and BSR today released a first-of-its-kind guide on traceability to help companies and stakeholders worldwide address the evolving landscape of supply chain sustainability and meet their broader sustainability goals.
A Guide to Traceability: A Practical Approach to Advance Sustainability in Global Supply Chains provides an overview of the importance of traceability for corporate sustainability objectives, outlines the global opportunities and challenges it represents, and summarizes practical steps for implementing traceability programmes within companies.
Supply chain traceability – the process of identifying and tracking a product or material’s path from raw material to finished good – has become a key topic for companies around the globe in response to increasing regulatory pressure and consumer demand for responsibly-sourced and produced goods and services. Food safety related issues, conflict minerals and deforestation have highlighted the need for traceability and increased demand for organic, fair trade and environmentally and socially-friendly products and materials.
Research indicates that traceability is a tremendously impactful tool for advancing sustainability objectives, but it has a long way to go to be considered an integral part of sustainable supply chain management. Currently, only a small percentage of commodities are traceable on sustainability attributes.
“With corporate supply chains growing in scale and complexity globally in recent decades, it is critical for companies to think beyond short-term financial considerations and build capacities to deliver long-term value along the entire supply chain,” said Ursula Wynhoven, the UN Global Compact’s General Counsel and Chief of Governance and Social Sustainability. “Traceability systems offer an unprecedented opportunity for companies to improve transparency throughout the supply chain and fulfil their wider sustainability promises.”
The Guide offers recommendations to companies ranging from multinationals to small and medium-sized enterprises (SMEs) on how they can consider and implement traceability, while highlighting the importance of collaboration with stakeholders around a common purpose. Examples include gaining a full understanding of all relevant sustainability issues for commodities; developing the business case for traceability once it is identified as the best way to mitigate those risks; and participating in existing traceability schemes or reaching out to peers, stakeholders and the UN Global Compact to start one where it does not yet exist.
Building on the landscape of existing traceability schemes, the Guide provides guidance about and points to areas of collaboration and alignment for 10 commodities that are widely associated with traceability for sustainability purposes – beef, biofuel, cocoa, cotton, fish, leather, minerals/diamonds, palm oil, sugar and timber – while noting that many other commodities could benefit from a traceability approach.
“In writing this guide, we aim to de-mystify traceability, to show companies clearly what it is all about, who the key players are, and how they can approach it” says Tara Norton, Director, Advisory Services at BSR. “Customers want to know that the sustainability claim they see on a product is true. When done correctly, traceability is a powerful tool to provide re-assurance to customers that companies mean what they say.”
Development of the Guide was informed by a year-long consultative process and interviews with companies, traceability schemes and civil society representatives; a survey of UN Global Compact Supply Chain Sustainability Advisory Group members; and an in-depth analysis of existing literature, case studies and traceability information.