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Harness the power of traceability to future-proof your ESG strategies

“When managers use ESG frameworks to inform choices, risk is inherently minimised.”

― Hendrith Vanlon Smith Jr

What is ESG?

ESG stands for environmental, social and governance. ESG is a methodology for evaluating how well an organisation performs in its business practices and concerning numerous ethical and sustainable challenges. Furthermore, it offers a means of estimating the risks and opportunities for businesses in specific fields.

ESG investment has gained considerable traction in recent years as a collection of non-financial criteria to guide discerning investors away from unethical businesses and towards ones that uphold moral principles. ESG investing, according to proponents, not only promotes moral clarity but also produces better results. It involves evaluating investment opportunities beyond financial considerations alone. It entails considering various factors, such as a company’s operational practices, environmental impact, and treatment of stakeholders and employees, to make informed investment decisions.

How can we harness technology for enhanced Traceability in ESG Strategies?

In the quest to harness the full potential of traceability in future-proofing ESG strategies, leveraging technology and fostering collaboration are key. By embracing digital solutions, blockchain, and the Internet of Things (IoT), companies can enhance traceability throughout their supply chains, ensuring transparency and accountability. These innovative technologies enable multi-tier ESG aggregation, secure information sharing, and seamless tracking of products and processes. Simultaneously, fostering collaboration among stakeholders, including suppliers, customers, and industry peers, creates a more sustainable and traceable ecosystem. By working together, sharing best practices, and engaging in joint initiatives, companies can effectively implement traceability, address common challenges, and achieve collective sustainability goals. The synergy between technology and collaboration paves the way for more robust traceability and future-proofed ESG strategies.

How can you align your sustainability goals with traceability?

Traceability plays a crucial role in achieving complete visibility across supply chains. By tracking the product journey, companies can gather and leverage data to demonstrate the product’s origin, adherence to sustainability standards, environmental impact, and positive contributions to people and the planet. This, in turn, leads to enhanced business processes. Depending on the company’s objectives and the benefits derived from supply chain transparency, it can aid in compliance procedures. By linking all supply chain actors, one can assess the quality of ingredients and categorise the risks inherent within the value chain.

How is traceability beneficial in aligning ESG strategies?

Traceability allows companies to aggregate their ESG data, track their progress, and ensure they adhere to their ESG commitments. The benefits of traceability in evaluating and improving ESG performance are listed below:

  1. It enables companies to disclose information about product origin, suppliers, and impact for transparency and accountability.
  2. It helps companies identify areas for improvement and stay ahead of the competition.
  3. Traceability aids in predicting ESG risks in the supply chain and taking proactive measures.
  4. It supports quality control, certification processes, and validation of claims.
  5. Traceability streamlines audits and ensures regulatory compliance.

How can we help manage ESG risks?

RightOrigins platform simplifies the evaluation of companies’ ESG performance across the value chain by collecting multi-tier ESG data, certifications and risk scores from multiple sources and generating standardised reports. This allows companies to quickly assess and compare suppliers’ ESG performance, identifying areas for improvement. Our software maintains a competitive advantage by recommending certifications and risk ratings based on geography. We ensure transparency and privacy by presenting only the aggregator score to buyers, which evaluates both the actors and their suppliers’ ESG practices and assessment results, comprehensively evaluating overall ESG performance. 

How does supply chain visibility help with ESG compliance?

The COVID-19 pandemic offered a firsthand perspective on how the effectiveness of an organisation relies heavily on its supply chain management. To enable ESG compliance tracking through traceability, visibility of the supply chain is of utmost importance, which allows us to identify key suppliers, categorise them on ESG standards, assess risks, monitor and track compliance and focus on continuous improvement. By implementing these steps, organisations can promote transparency, sustainability, and responsible business practices within their supply chain networks. 

You can make informed decisions and strengthen your sustainability initiatives using traceability. It helps drive long-term viability in an ESG-focused business landscape. Studies indicate that companies with strong ESG performance tend to deliver better returns. You can feel good about contributing to positive change by making sustainable investment decisions. CIED helps lead the way to a sustainable future and uncover the issues most pertinent to your company, making you compliance-ready.

 To learn more about how RightOrigins, our Supply Chain Traceability and ESG Intelligence suite can support your ESG & Sustainability goals for 2024 & beyond, consult with our in-house expert. 

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