Standard Chartered Research Finds That Companies in North America and Europe Are Doubling Down on Supply Chain Resilience
New research from Standard Chartered reveals that environmental, social and governance (ESG) obligations and managing supplier financial risks are top of mind for corporates in North America and Europe, as business recovery gets under way.
Read More: Standard Chartered Launches New Proposition To Support Sustainable Supply Chains
“Companies are even more focused on reducing the risk of non-compliance with ESG targets, and are increasingly looking for banking partners who support sustainable, resilient, agile supply chains. Global acceptance of defined standards will be essential.”
With most North American and European companies producing goods outside their home region, most respondents also recognise that substantial work is needed to stay ahead of changes in regulation and stakeholder expectations. This is particularly so within their indirect supply chains within their supplier ecosystem.
93% of European respondents and 94% of North American respondents to the survey reported that the financial resilience of their supply chains is now a priority, with the majority (77% and 88% respectively) saying they are making extensive use of supply chain finance (SCF) programmes to shore up both their direct (tier one) suppliers, as well as those further down the chain.
Companies have also indicated strong awareness of the need to address environmental and social risks in their supply chains. 94% of European respondents and 96% of North American respondents acknowledged the importance of environmentally sound practices in their direct supply chains. This awareness is consistent, albeit slightly lower (73% and 88% respectively), for indirect supply chains within their supplier ecosystem.
Regulatory obligations and reputational risk are also key concerns for companies in the region, with 63% of North American and European respondents emphasising that failure to understand and comply with new regulatory requirements would have a very significant negative impact.
Victoria Claverie, Head of Trade, Europe at Standard Chartered, said: “Companies are even more focused on reducing the risk of non-compliance with ESG targets, and are increasingly looking for banking partners who support sustainable, resilient, agile supply chains. Global acceptance of defined standards will be essential.”
Read More: Netcracker Named The 2021 Asia-Pacific OSS BSS Company Of The Year By Frost & Sullivan
Filipe Mossmann, Head of Trade Sales, Americas at Standard Chartered, said: “The importance of sustainable supply chains and the role it plays in a company’s ESG plan will gain increasing prominence in the new world economy. As expectations to report tangible ESG related improvements from their direct and indirect supply chains increase, businesses with holistic indicators of supply chain resilience and sustainability will be well placed to answer the call for greater transparency and stay ahead.”
With the fragility of global supply chains being exposed over the last 18 months, and the opportunities that can be seized to build greater resilience, the study reveals that companies headquartered in the North America and Europe are looking beyond ‘just in time’ supply chains to ‘just in case’, expanding their focus from optimising efficiency to managing financial and ESG risk to look create more robust performance in the new normal.
