Let's face it: In today's marketplace, corporate social responsibility and conscious consumerism have moved from a side dish to a main course - brand building-wise that is. The fact is that both consumers and employees expect companies to be agents of change and good in the world. According to data from EngageForGood.com:
- 86 percent of consumers believe that companies should take a stand for social issues,
- 77 percent feel a stronger emotional connection to purpose-driven companies over traditional companies,
- 79 percent say they are more loyal and 73 percent are willing to defend that company.
This and other similar research would suggest that a commitment to social responsibility can pay big dividends in shareholder value, visibility, employee retention and customer trust. Interestingly enough consumers now hold companies accountable for this commitment beyond their own businesses to the entire supply chain their companies utilize.
Here are three key considerations every small business should take into account when creating a socially conscious supply chain.
Go for sustainable practices with real impact, not just show.
"Companies might think they understand the environmental impacts of their business, but often they don't have all the facts," says Irfan Khan, CEO of Bristlecone, a leading global supply chain business. "To implement truly sustainable practices, a business needs to identify the most significant environmental and social challenges they face and prioritize efforts with suppliers to create a more sustainable supply chain."
If you're going to adopt sustainable practices, make sure they actually make an impact on the environment. By showing customers that you are genuinely committed to reducing your carbon footprint and helping the environment, you help establish trust and creditability.
Join industry collaboration.
Becoming more socially conscious and sustainable can potentially be an expensive endeavor, especially for a small business. One way to mitigate these costs is through collaboration with other companies. Working together can help prevent audit fatigue, training redundancy and mountains of paperwork for suppliers working to meet similar requirements from their customers.
More than ever, the one key concern on all consumers' minds is transparency. Consumers want to know the source of the goods and products they are buying. As a small business, being able to show transparency in the supply chain can provide a competitive advantage and be a positive branding point.
For example, in today's food industry, a growing number of consumers care that their food is ethically grown or caught. Likewise in the coffee industry, consumers worldwide are increasingly interested in high-quality, gourmet, artisanal beans - but ones that are fair trade sourced such as Equal Exhange, Stumptown Roasters and Allegro.
"The solution to being transparent is end-to-end supply chain visibility," say Khan. "This provides companies with another competitive advantage: It makes their supply chains more resilient, more anti-fragile," he says.
Transparency through end-to-end visibility will enable companies to immediately know the affected suppliers and consumers in a region, perform impact assessments, and pursue the correct mitigation strategy. While Khan says this takes upfront investment from companies, the alternative to not changing means allowing your supply chain to be left exposed to fraud, human rights violations, environmental harm and major natural disasters. By knowing every step of their supply chain fully -- having end-to-end expertise -- a company's supply chain will absorb the shock rather than buckle.
By taking these three steps, business leaders can improve their business, reduce their carbon footprint, and demonstrate their commitment to their stakeholders to be socially responsible.