By PJ O’Connor, Manager Business Development, and Michael Fossick, Business Systems Analyst, OC Reilly, Inc.
(March 11, 2019)–As younger generations enter the workforce and ascend into management positions, the importance of ethics in business promises to only get stronger. Millennials, Gens X, Y, and even Z – they have grown up within a framework that values collaboration, transparency, and the assumption that organizations will function in an ethical and sustainable fashion as the normal course of business.
Those expectations spill over into supply chain-driven decisions. Some might say supply chain actually serves as the front line of a company’s ethical and sustainable performance.
Loyola University Chicago’s Supply and Value Chain Center recently conducted a survey to assess the latest actions companies are taking or planning to take in the next year in the area of Corporate Social Responsibility.
Supply chain played a prominent role, as an article in the Oct. 30, 2018, edition of Supply Chain Management Review* on the study attests:
“No one doubts that supply chain has a significant impact on a company’s bottom line; when procurement, manufacturing, logistics and distribution are hitting on all cylinders, margins and customer service improve.
“Supply chain is also where the rubber hits the road when it comes to ethics, whether that has to do with an organization’s sustainability and carbon footprint efforts or how it treats its suppliers and the communities in which it does business. In other words: supply chain owns ethics.
“That was reflected in responses to the question of the areas and titles within an organization responsible for supply chain ethics: While respondents identified seven areas as most responsible for ethical supply chain compliancy within their organizations, three of those areas, representing 62%, were supply chain functions: supply chain (31%), procurement (20%) and operations (11%).”
Examining which products are purchased, from which suppliers, and under what circumstances, may all factor into supply chain decisions to an increasing degree over the coming years. Of course, every organization should operate guided by a strong sense of ethics and morals. But those factors – including considerations surrounding sustainability and environmentally friendly performance – should permeate throughout the entire organization, starting now. Supply chain sits squarely at the center of those determinations.
© 2019 OC Reilly Inc.
* https://www.scmr.com/article/the_ethical_supply_chain