Be loud and proud with sustainable practices

Top down view of someone planting a new tree into soil | sustainability SAP

With a world caught up in climate difficulties, sustainability needs to take the priority, along with ensuring ethical practices.

Consumers want to buy sustainable products from ethical companies, and they’re willing to put their money where their mouth is. In fact, recent studies show that eight out of ten consumers said they would pay up to 5 percent more for sustainably produced goods.

Yet it can be challenging for consumers to identify which products are truly sustainable. While regulators establish minimum standards for everything from drinking water to vehicle emissions, individual retailers are beginning to adopt expanded measures that go considerably further as a way to address consumer concerns and advance their own sustainability goals. In June, for example, Walmart and Sam’s Club announced an initiative to raise supplier standards around tuna fishing. Their new policy aims to address issues such as accidental catching of species other than tuna, illegal fishing and abandonment of fishing gear. All of these factors pose a threat to ocean ecosystems.

To ensure suppliers are complying with these standards, Walmart and Sam’s Club will need increased visibility across the tuna supply chain, and they’re not alone in this need. Whether companies are seeking to comply with regulatory standards or track progress against their internal policies, they need transparency in every tier of their complex supply chains.

Efficient, effective technology can help businesses acquire and manage the data and information they need to measure compliance, minimize risk and boost sustainability. IoT devices, embedded in fishing vessels and storage facilities, can collect data on fishing practices, temperatures and handling conditions, contributing to effective oversight and management of sustainability practices. This kind of data will also be of great interest to retailers.

Gain access to relevant data

Accessing accurate data is the first step for businesses to gather the sustainability information they need. Walmart and Sam’s Club are focused on their oversight of transshipment – the practice of transferring fish products from one fishing vessel to another at sea or in port – which offers opportunities for bad actors to hide illegal or unregulated fishing activities. By 2027, Walmart and Sam’s Club will only source from fisheries that offer 100% monitoring of transshipment activity – a process that will produce massive amounts of data.

One solution is to implement a technology layer that can gather data, measure KPIs and benchmark against other companies in the same industry. The ability to track and trace the movement of products from one location or company to another lets businesses create an unbroken chain of ownership from raw materials to finished goods. Or in this instance, from sea to plate.

Rely on collaboration tools to share data

With accurate data in hand, companies need collaboration tools that ensure the data’s integrity and authenticity from end to end. As a decentralized and unchangeable ledger, blockchain technology can ensure data is uncompromized as it moves from one company to another, or otherwise changes ownership.

This data must be housed in a system that allows companies to determine exactly which end products their raw materials went into, as well as every step they underwent along the way. This type of system enhances the ability of companies like Walmart and Sam’s Club to monitor reports from transshipment observers and other inputs. It can also be helpful in the event of a product recall or other product safety concerns.

Showcase sustainability to customers

Companies can now focus on the customer experience, implementing tech-enabled features that allow end consumers to access the information they’ve gathered about their supply chain. This type of transparency builds trust and strengthens brand reputation. That’s especially true for Gen Z consumers, who are particularly conscious of sustainability.

Stay on top of regulatory and compliance issues

Regulatory oversight of supply chain issues is increasing around the world. Several European countries and the United States have recently passed legislation mandating due diligence in supply chains, while the European Union and Canada have proposals under consideration. Technology solutions can help businesses track their compliance with constantly changing regulations to back up their sustainability claims.

What companies need to learn about supply chain visibility

The tuna fishing policy serves as a powerful case study for other companies looking to embrace sustainability as a core business principle. Like SAP, companies in our industry are committing to zero emissions, zero waste and zero inequality. Stakeholders aren’t settling for less, even amid growing anti-ESG backlash.

In this environment, a holistic approach to sustainability is key. Businesses must examine their value chains comprehensively, from sourcing raw materials to understanding the end product’s lifecycle.

By adopting technology-driven solutions like blockchain and IoT, companies can ensure that their sustainability efforts extend beyond the surface level to every aspect of their operations. Regulations and rules will only continue to grow in number, but with the right technology, companies can achieve greater supply chain visibility and meet their sustainability targets.