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Parent company of Puma provides detailed look at its Environmental Profit & Loss methodology

The SSC Team December 17, 2015 Tags: , , , , , , , , , , , Strategic Sustainability Consulting No comments

This summer, Kering, the parent company of the clothing and footwear manufacturer, Puma, not only published its EP&L, the environmental footprint of the company’s operations translated into monetary values, it published the entire methodology as an open-source tool for others to use.

The EP&L analyses the impact of Kering’s supply chain from raw materials to retail outlets and reports the impact in monetary terms.

In an article about Kering’s decision to open-source the methodology, the company’s CEO said, “Our EP&L has already served as an effective internal catalyst to drive us towards a more sustainable business model. I am convinced that an EP&L, and corporate natural capital accounting more broadly, are essential to enable companies to acknowledge the true cost on nature of doing business.”

From making the business case for sustainability to assessing carbon asset risk in monetary terms, and finally to reporting environmental results using natural capital accounting, more and more companies are moving toward currency as a way to plan, assess, and evaluate environmental performance.

This move makes sense, considering we live in the age of global capitalism.

Kering’s EP&L, along with World Bank’s WAVES initiative, the World Business Council for Sustainable Development’s Valuation Guide, the Natural Capital Coalition, and others, provide strategies to implement natural capital accounting into the sustainability reporting process.

If your company is interested in producing a sustainability report using principles of natural capital accounting, let us know! And check out our analysis of how Puma stacks up to other athletic apparel companies.

Will the UK Modern Slavery Act do any good?

The SSC Team November 5, 2015 Tags: , , , , , , , , , Strategic Sustainability Consulting No comments

Late last week, the UK Parliament passed the Modern Slavery Act, a bill designed to require UK companies to report any steps they are taking to address and prevent human trafficking and modern slavery in their supply chains.

According to the Global Slavery Index, modern slavery is estimated to include more than 36 million people who work in conditions completely controlled by others. Most of these people are found deep in the supply chains of global corporations.

To comply with the Modern Slavery Act, it doesn’t mean a company will have to actually address human trafficking and modern slavery. A company simply has to report whether it has taken any steps to do so.

Therefore, if a corporation files a report indicating that it has taken no steps, it will still be in compliance with the law.

So, does this do us any good?

Overall, yes.

This act pushes corporations one step closer to connecting the process of reporting to the concrete steps of taking action.

We've seen this cause/effect hundreds of times as external pressure – supplier scorecards, stakeholder pressure, or legislation – pushes companies to report. The first report can be humbling, but the process of reporting opens up action steps, focus areas, and progress.

As companies file their first reports, some saying “no action taken.” We believe that their stakeholders will ask “why?” It is then that they will realize it is time to do an initial Social Audit, Supply Chain Analysis and/or Life Cycle Analysis.

A recent article in Huffington Post written by two CEOs speak to the effect of data:

"The vulnerability in our supply chains was in labour hire, specifically the recruitment of migrant workers from disadvantaged backgrounds. Social audits revealed that recruiters were stealing wages from workers through excessive recruitment fees and high interest loans, creating a situation of debt bondage. Upon learning of these terrible conditions, we took immediate action so that workers were paid back the fees they were owed, allowing them to earn a proper wage.”

The companies and the CEOs in question were performing social audits prior to the UK Modern Slavery Act, and were able to take action.

We believe that more companies will engage with auditors, and decisive action will be taken because of this new law.

So, yes, the Modern Slavery Act is going to do some good.  

Would stronger legislation and adoption in other countries, like the U.S., do even more good? Likely.

However, corporations can and should begin on this important work now. There is no need to wait for legislation to become a more socially and environmentally responsible organization.

Learn more about supply chain assessments and audits and how they can help your company create a system to uncover risks lurking in the supply chain. How have supply chain audits helped your organization uncover risk? Let us know in the comments!

 

Life Cycle Analysis can help you write a better ‘business continuity plan’

The SSC Team October 20, 2015 Tags: , , Strategic Sustainability Consulting No comments

Emergency planning is critical for a business to survive a natural disaster, political disaster, loss or incapacity of a key leader, or other catastrophe. However, it’s not an issue that most businesses want to talk about.

“Smart entrepreneurs, however, have a healthy fear of the unknown and regard it as a strong motivator to take action and protect both their businesses and the talented people who help them thrive,” writes Heather Ripley in a recent article from Entrepreneur.

Ripley outlines four key steps to develop a business-continuity plan for small business owners. The first step is identify potential disasters and their solutions.

Identifying disasters – the basics

Pinpointing common crises – car accidents, hurricanes, data loss, supply chain disruptions due to politics or weather events – are the basic first steps in continuity planning.

Going beyond the basics

We believe that performing a full product life cycle assessment will help businesses better identify potential disasters and their solutions.

Once you know where your raw materials come from, how they are harvested, your intermediate suppliers, the countries where those suppliers operate, the politics and climate of those countries, the modes of transportation in your supply chain, the demands and opinions of your customers, and the where and how your products are disposed, you’ll immediately be able to see where your risks are and how to plan to mitigate those in a crisis.

Even better, Life Cycle Assessment will help your business eliminate some risks well before a crisis begins. Maybe you will find value in setting up multiple suppliers in different geographic regions to decrease the effect of a typhoon or hurricane in one place. You could find that phasing out an ingredient in your product now, before that ingredient becomes a target for protest, may add a selling feature to the product, decrease risk, and decrease environmental impact. 

If you want to know more about how Life Cycle Assessments will help you identify and mitigate risks, contact us or check our LCA services page to give you an idea of how they can guide your sustainability-guided continuity planning.