Buying ethically sourced products is not as straightforward as it might seem, according to Stanford researchers who undertook a large-scale analysis of sustainable sourcing practices. While more than half of the global companies surveyed apply sustainability practices somewhere in their supply chain, these efforts tend to have a much more limited reach than people realize.
"Our results show a glass half full and half empty," said study coauthor Eric Lambin, the George and Setsuko Ishiyama Provostial Professor in Stanford's School of Earth, Energy & Environmental Sciences.
The paper, published today in the Proceedings of the National Academy of Sciences, relates sourcing practices to the U.N. Sustainable Development Goals, an agenda for a sustainable global economy. With global supply chains touching more than 80% of global trade and employing more than one in five workers, corporate supply chains have the potential to play an outsized role in achieving the U.N. goals.
The researchers analyzed 449 publicly listed companies in the food, textile, and wood-products sectors, and found about half use some form of sustainable sourcing practice ranging from third-party certification of production standards to environmental training for suppliers.
The study found that more than 70% of sustainable sourcing practices cover only a subset of input materials for a given product. For example, a company might use recycled materials for the packaging of a product, but leave the remainder of a product's upstream impact unaddressed.
In addition, almost all sustainable sourcing practices address only a single tier in the supply chain, usually first-tier suppliers, such as the textile factories that sew T-shirts. Often, the remaining processes, from dying the cloth to growing the cotton, remain unaddressed.
"Advancing environmental and social goals in supply chains can quickly become very complex," said study co-author Joann de Zegher, a postdoctoral fellow at the Stanford Graduate School of Business. "This complexity is reflected in our findings that companies use a broad range of strategies and that current efforts have limited reach."