In order to orient an organisation towards supply chain sustainability it is essential to set up an adequate governance structure and to assign clear responsibilities (see page 51 of linked guide). However, it is equally important to define clear targets and KPIs for the organisation and individuals, because these will give a direction and help measuring the success in having a sustainability impact.
The key recommendations of this guide, published by the UN Global Compact and BSR, are:
- The goal setting should be a collaborative process that involves each department being responsible for achieving the defined goals.
- Align the sustainability objectives with business needs.
- Set goals that are relevant for your supply chain. For instance, think about where your supply chain has the biggest social or environmental impact or risk, and then focus on that.
- The performance against defined goals needs to be tracked and discussed regularly with the responsible stakeholders, e.g. in a yearly performance review.
- The targets and KPIs need to be broken down into actionable targets across the whole organisation in a consistent way to ensure that all stakeholders work towards the same direction.
- KPIs for measuring how much the organisation is doing to improve their supply chain sustainability are important (e.g. how many suppliers have been assessed, audited or trained etc.). However, don’t forget the KPIs to measure the actual impact of your supply chain sustainability programme. For example, what is the social impact on women, children, persons with disabilities, workers or communities in your supply chain?
You can read the full guide, including some great case studies on pages 67-71 by clicking this link.
(Picture by Mitchel Boot, Unplash)