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7 Leaders at Davos 2022 on Securing Sustainable, Resilient Supply Chains, Despite Global Shocks

By: 3BL Media

By Kimberley Botwright Head, Sustainable Trade, World Economic Forum & Felipe Bezamat Head of Advanced Manufacturing Industry, World Economic Forum

SOURCE: SAP

SUMMARY:

  • Russia's invasion of Ukraine triggered new supply chain disruptions, but supply chains face additional challenges.
  • If unaddressed, supply chain challenges will hamper economic recovery and long-term growth.
  • Ahead of the World Economic Forum Annual Meeting in Davos 2022, business leaders provided insights on how to build supply chain resilience and sustainability.

DESCRIPTION:

At the start of the year, we asked business leaders to share insights on how supply chains were changing and key trends to watch in the coming months. Shortly after, Russia’s invasion of Ukraine triggered new disruptions in supply chains and trade networks, on items ranging from food to semi-conductors, with significant implications.

Exacerbated by the immediate conflict, supply chains face many challenges, which if left unaddressed will hamper economic recovery and long-term growth. Deepening supply-demand imbalances – compounded by various shocks in the last two years – could lead to high inflation. The IMF estimates this could be in the order of 5.7% and 8.7% for advanced and developing economies, respectively.

Meanwhile, food trade disruption will hit the poorest the hardest, and chip shortages impact the supply of everything from smartphones to automobiles and washing machines. And even though disruptions are here to stay, recent studies find only 12% of companies are sufficiently prepared for future shocks in supply chains.

Yet many stakeholders – public and private – want to improve supply chain sustainability while they build resiliency for future disruptions. For example, governments are looking at increasing supply chain disclosure and obligations, among other interventions.

The World Economic Forum recently worked with over a dozen business sustainability champions to map key trends and views on supply chain sustainability policies. At the same time, more companies than ever are working with suppliers to reduce emissions, increase resource circularity and ensure workforce engagement and inclusive transformation across their value chains.

Leaders from the public and private sector gathered at the Forum’s Annual Meeting 2022 in Davos have the opportunity to come together, after a long time, to revisit and prioritise action to respond to this landscape. To inform these conversations, we again asked our partners what that should look like for supply chain resilience and sustainability. Here's what they said.

'Data transparency is essential'

Julia White, Chief Marketing and Solutions Officer and Executive Board Member, SAP SE

Investing in technology and data transparency combined with collaborating across networks is key to enhancing business resilience, performance and sustainability.

Data transparency is essential. By embedding metrics in core business processes that measure climate risk, carbon emissions, and waste and pollution, among others, across both upstream and downstream supply chains, organisations can access a continuous view of financial, social and environmental data that manual processes simply cannot offer. Suppliers are increasingly required to be transparent and verifiable in their fair and equitable labour practices. As new legislation requires organisations to more consistently and systematically address human rights issues, business leaders need data-based monitoring and validation mechanisms across an organisation’s entire value chain.

Cooperation across business networks is required for designing, manufacturing, delivering and maintaining products in ways that minimise carbon footprints, decrease waste and help ensure social equity. Operational, purchasing and industry networks help companies create, share and act on sustainable business information. They can help support diverse and sustainability-focused suppliers and partners, and open new avenues for innovation, cost savings and environmental and societal impact.

Continue reading here

Image: REUTERS | Darren Whiteside 

Tweet me: .@SAP's @julwhite shares insights on how to improve supply chain sustainability while building resiliency for future disruptions and challenges. Read more: https://bit.ly/3GnRAfy @wef

KEYWORDS: SAP, Davos, NYSE: SAP, World Economic Forum

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