Companies Increasingly Dedicating Sustainability Resources to Supply Chain Functions

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Companies are increasingly embedding sustainability resources into their supply chain organizations. The latest State of the Profession  report from GreenBiz, which examines how the role of sustainability executives has evolved over the years, shows a growth in supply chain sustainability efforts.

In 2014, the number of companies dedicating sustainability resources to supply chain efforts grew 10%, according to GreenBiz research. In 2015, that number jumped to 26%, showing significant growth in the last two years.

While companies are connecting sustainability and their supply chains, this doesn't seem to be the case with procurement. The number of companies dedicating sustainability resources with procurement functions has actually fallen over the years, the GreenBiz report showed. In 2014, 29% of companies embedded sustainability resources within procurement functions. In 2015, just 18% of companies reported doing so.

The findings reflects those in another report from the Institute of Environmental Management & Assessment that showed many companies lacked specific sustainable procurement plans. That report stated just 12% of the corporate social responsibility practitioners worked at a company with a sustainable procurement policy or approach in place.

Teams and Budgets Grow

Additional findings of the recent GreenBiz corporate sustainability report show sustainability teams and budgets growing. This year, 46% of companies reported the number of team members in their sustainability organizations growing. Forty percent said the headcount remained the same in 2015.

“This indicates a robust job market even if relatively small when compared to, say, software engineering or marketing functions,” the report said.

More sustainability executives are also being hired from outside the organization (59% in 2015), as opposed to the in past when sustainability roles at companies were largely filled by internal promotions or lateral moves, according to the report.

Companies are also increasingly using third-party consultants to support sustainability efforts. About 80% of companies reported outsourcing sustainability services, GreenBiz research showed. It also indicated larger companies are more likely to rely on outside firms to help achieve sustainability goals.

Company sustainability budgets have also increased over the years. According to the report, 40% of companies saw sustainability budgets grow in 2015. Forty-two percent said budgets stayed the same in 2015 compared to 2014. The largest chunk of investments are going toward sustainable supply chain efforts as well as product and service innovation, the report stated.

Another sign of improvement is the growing number of companies that actually now have a specific sustainability budget. In 2010, 45% of companies said there was no dedicated budget to sustainability efforts. In 2015, however, just 28% are operating without such a budget.

The GreenBiz report also pointed out that companies agree the more financial resources the firm has to dedicate to sustainability plans, the more likely they are to reach their sustainability goals.

“One consistent aspect of budgeting for sustainability at organizations large and small is the sentiment that their programs would be more successful with greater funding,” the report said.

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