20 May 2020
Companies demand environmental transparency from suppliers
The CDP have reported a 24% jump in companies that are asking their suppliers for environmental transparency (see full article here). Whilst the net increase does not seem significant at just 30 companies, the total companies now asking for transparency is 150+ which brings the combined purchasing spend to more than US $4 trillion.
The data that companies want to know about includes deforestation and/or water security issues, risks and opportunities that may arise as a result of climate change and the related strategies to cope with such issues.
The CDP report that the demand for this data is driven by an increased awareness of the environmental risks posed to business – including physical impacts disrupting global supply chains. In our view, the Covid-19 pandemic will act as a wake-up call to global business as an example of how fragile supply chains can be in the event of catastrophic events. We expect that more businesses will examine the resilience of their supply chains against a variety of sharp shock events and put increasing pressure on their supply chains to consider their own resilience.