We have the pleasure of introducing our new interview format ‘Sustainability Chat’, where we talk to frontrunners in the sustainability field and pick their brain on experiences in working with sustainability, personal views and their best tricks of the trade. First out is our very own Frida Emilsson, co-founder and COO of Worldfavor, who has a passion for making truly sustainable decisions accessible to every person and business.
How did you get interested in working with sustainability?
As long as I can remember I dreamt about creating a long-lasting, positive impact on a big scale. A world with inequalities, injustice and problems hurting both people and the nature we share, was not something I could watch from the sideline. I don’t know, maybe it’s my obsession with solving problems – If I see one, and it’s important, I want to solve it and I can’t let it go.
When I realized that businesses have such an enormous impact on people and the planet – both exponentially positive effects, but also negative, I understood that accelerating this transition to responsible, sustainable business and sustainable decisions was where I could make the biggest long-term impact.
Everyone is talking about sustainable supply chains and the importance of reducing risks in the supply chain – why is this such a hot topic?
As a society we are more informed than ever. Customers and other stakeholders know about the challenges and impacts in companies’ supply chains and they therefore expect that companies ensure that they work with suppliers that are responsible. Today, supply chains are seen as a part of the company. Companies can’t push away the responsibility and say that what their suppliers do, have nothing to do with them– no one accepts this anymore.
Customers today know that big parts of emissions come from the supply chain, and that a company has the power to choose what suppliers to work with. This is why sustainable supply chains are such a hot topic. It’s simply expected that a company that wants to define themselves as sustainable, also needs to make sure that their supply chain is as well.
I believe this year’s pandemic has in fact made this topic even more urgent. Many companies have really felt the short-term commercial effects of not understanding their supply chain dependencies enough. Sustainable supply chains as a concept is not only about environmental aspects, but of knowing what your company’s dependencies are and how they will affect your company if you are not aware of the risks.
What are the biggest challenges in creating a sustainable supply chain?
I would say that one of the absolute biggest challenges is to get a full understanding of your supply chain. You can’t create a sustainable supply chain if you don’t know what the supply chain looks like, what companies are involved, and what the performance of those suppliers are. Many companies are struggling to find out how their supply chain looks beyond their tier 1 suppliers (those they have a direct relation to). The deeper levels of sub-suppliers are often unknown. Sometimes companies even struggle to have a full picture of tier 1 suppliers.
When you know who your suppliers are, the next challenge is to know how well they perform in terms of sustainability and responsibility and the underlying risks. You need this information in order to get a sustainability and risk assessment of your suppliers, which is the first step to be able to improve it and minimize the risks.
What companies would you say are leading the way in supply chain sustainability, and how can other companies learn from them?
There are several companies that are leading the way when it comes to supply chain transparency and sustainability. Companies come from different backgrounds and therefore have different prerequisites and challenges. From smaller, newer companies that carefully choose few suppliers with a very strong sustainability focus.One good example here is the Swedish brand Nudie Jeans.
Then we have large global brands who have to transition an enormous organization with an even larger and complex supply chain in multiple tiers. This is more difficult of course, as a large and complex supply chain is more difficult to control and gain insights into. I am also very impressed by the Swedish retailer Systembolaget, the second largest buyer of Wine & Spirits in the world, who is working hard with gaining transparency and visibility of their supply chain all the way from vineyard to the bottle on the store-shelf.
Another well-known good example is the outdoor company Patagonia, who have pushed supply chain transparency and sustainability actively for more than ten years.
There is plenty to learn from them, but one important thing we can learn is that they have recognized that a sustainable supply chain starts with transparency and understanding of the parties involved, and from there, the real impact and concrete actions can be taken to push it in a more sustainable direction. They have understood that a sustainable supply chain is key to their company’s success in today’s and tomorrow’s market, and that if they don’t start now, they will risk their position.
If you could give one piece of advice to companies just starting out their supply chain sustainability – what would that be?
Start small. You need to start somewhere, and while you do that you can work on a long-term ambition and goals. Get a sustainability risk understanding of your tier 1 suppliers first, maybe also of where in the world their sub-suppliers operate. If you have many suppliers, start with the parts where you have most spend, and/or together with the industries/geographic areas where many risks are naturally inherent. This will give you plenty of information about the performance and risks of your tier 1 suppliers and a sense check of tier 2. Now you have information on where you need to focus more attention. Your first mission should be to understand where your risks are.
As you get these insights and as your organization starts to learn more about supply chain risks and sustainability, your needs will naturally evolve and you can start analyzing more information about your suppliers to go deeper, broaden the scope of your supplier assessment, and set more ambitious targets for risk reduction and concrete actions.
Remember that this is about a long-term collaboration with your suppliers. You need to be clear about your expectations, but also give them the opportunity to adjust and improve.
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