Supply Impact


Upcoming EU Regulations Require Sustainable Supply Chains

Upcoming EU regulations will require major adjustments by companies to ensure that their supply chains are sustainable.

The EU Due Diligence Act seeks to introduce binding requirements for companies to address negative impact on human rights, environment and good governance throughout their supply chains. The EU has also taken steps towards an import ban on products related to severe human rights violations. The Corporate Sustainability Reporting Directive sets out to establish standards regarding sustainability reporting. These will be mandatory for all large companies and most publicly quoted SMEs.

These EU regulations extend the scope and intensify the stringency of sustainability requirements. Addressing them will raise difficult and complex challenges for companies, particularly for those with less mature supply chain sustainability arrangements.

Supply Impact can help companies meet these challenges and unlock the business potential of sustainability. We offer a combination of purpose-built tools, advanced analytics and domain expertise to achieve these ends. Below, we highlight some of the major challenges raised by these regulations and discuss the ways in which Supply Impact can help companies overcome them.

Supply chain mapping

Firstly, companies will have to identify and map their business relations with suppliers at consecutive tiers of their supply chain. In practice, this requires significant effort, resources and expertise. Building on the data that companies already have, Supply Impact helps companies collect additional information to map their supply chain. 

Risk (and opportunity) assessment

Secondly, companies will have to identify sources of social and environmental harm in their supply chains. Supply Impact provides tools to evaluate sustainability risks related to the location, production and relations of a particular company.  Our team also helps companies integrate sustainability in the companies’ value-creation strategy. 

Sustainability analytics

Assessing and analyzing social and environmental impact constitutes an essential part of a company’s efforts to become more sustainable. This, however, requires relevant data and adequate methodology. Supply Impact helps companies collect such data and evaluate their sustainability performance. Our team also analyzes the complex relations across economic, social and environmental dimensions in the supply chain.

Continuous improvements

Given the aim of these regulations to encourage an on-going and dynamic approach towards sustainability, companies will have to aim towards continuous improvement. Supply Impact offers a set of tools – including optimization and predictive analysis, capacity building and other forms of supplier engagement –  to help companies make their supply chains more sustainable over time, while retaining profitability.

Effective communication

One way to capture the market value of improved supply chain traceability and sustainability is to better communicate the progress achieved. While the EU reporting standards have not been set yet, Supply Impact follows closely the work of the technical body responsible for making recommendations in this regard. We can thus help companies highlight their achievements and disclose areas that need further attention, in a reliable and persuasive manner. 

Let’s engage in the sustainability journey together! Contact us and our team would be glad to assist you.