Creating a Sustainable Supply Chain -...
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The Time Has Come Creating a Sustainable Supply Chain: Global Sourcing Council Wanda Lopuch Chair of the Board Angeline Judex Executive Director sig.org/eval
Transcript of Creating a Sustainable Supply Chain -...
The Time Has Come
Creating a Sustainable Supply
Chain:
Global Sourcing Council
Wanda LopuchChair of the Board
Angeline JudexExecutive Director
sig.org/eval
Managing Risk in Global Supply Chains
Business Case for Responsible Sourcing
Wanda R. Lopuch, Ph.D.; Chairman of the BoardAngeline Judex, MPA; Executive DirectorGlobal Sourcing Council, www.gscouncil.org
About
Global Sourcing
Council
Who are we?
Global Sourcing Council
• Established in 2007
• Mission: Profit with Purpose through Sustainable Global Sourcing
• 20,000 sourcing professionals around the world
• Independent platform for business, academia, government organizations and NGOs
• Education, outreach, best practices, research
• Member of the UN Global Compact; consultative status with the UN ECOSOC
Global Sourcing Council
Program: Business Embraces the UN 2030 Agenda
Sept 24th 193 Member States of the UN signed SDG “Transforming Our World: The 2030 Agenda for Sustainable Development”
17 goals
15 years
Global Sourcing Council
• Programs: GSC 3SAwards• Best Practices in Responsible Global Sourcing
• Community Engagement• Employee Engagement• Diversity • Most Innovative Sourcing• People’s Choice
Grand Finale: March 2017 –New York Headquarters of The United Nations
Celebration of Social Entrepreneurswww.gsc3sawards.com
GSC presents the voices of global sourcing community in SDGs:
Half Billion $$$ Challenge
to turn Supply Chains into Responsible Supply Chains
By Sept 25th 2017
Business takes Action on SDGs
Risk Management in
Supply Chains
Vendor Management
Responsible Sourcing as an Enlightened Selfpreservation
Global Sourcing Council
Agenda:• Risks in supply chains• Evolution of vendor selection cards vs. risk•Current perspective on sustainability in sourcing
• business perspective• consumer perspective• investors perspective
•Apple Foxcon case study
•Objective:• Sustainability in Business is an Enlighten Selfpreservation• It Pays off to Run Responsible Supply Chains
Risks in Supply Chains
Supply Chain Management
Risk Management Identifying project risks
Understanding
Analyzing
Managing current risk
Mitigating future risk
Vendor Management Vvendors profiles for spec - rfp
Identifying vendors universe
Vendors selection* -Scorecard
Contractual/legal
Vendors relationship
Vendors development
Vendors risk management
Characteristics of Vendorsfor the Vendor Scorecard
Cost
Quality
Delivery time
Capacity
Flexibility
Lead time
Financial
Customer base
Product development
Location
Reputation
Certifications, recognitions
Social responsibility
Environmental compliance
Labor conditions
I. Cost AdvantageII. Vendor Mgmt
III. Risk Mgmt
Vendor Selection Scorecard-Evolution
Vendor Selection Scorecard1.1 Cost advantage
80-90% Cost
Quality
Delivery
10-20% Capacity
Flexibility
Lead time
Certifications
Location
Reputation
Customer base
Financial health
Social responsibility
Product development
Environmental compliance
Labor conditions
Vendor Selection Scorecard 2.1 Vendor Management
50-70% Cost Quality Delivery
10-30% Capacity Flexibility Lead time Certifications
10-30% Product development Financial health Customer base
Location Reputation Social responsibility Product development Environmental compliance Labor conditions
Vendor Selection Scorecard 3.1 Risk Management in Supply Chain
60-90%
Cost
Quality
Delivery
10-30% Capacity
Flexibility
Lead time
Location
10-30% Product development
Technical/innovation Financial health
Customer base
1% - 15% Reputation
Social responsibility
Environmental compliance
Labor conditions
Culture and values
Risk Management in the Supply Chains
Vendor Selection Scorecard 3.1 Sustainable Supply Chain
Economic: 60-90% Cost Quality Delivery Capacity Flexibility Lead time Location Product development Technical/innovation Financial health Customer base
Environmental -5-25% Location Local regulations Compliance Value and culture
Social: 1% - 25% Reputation Social responsibility Environmental compliance Labor conditions Culture and values
Nike – 25%Microsoft – 11%
Intel -7%Nintendo – 0%
Social, Environmental,
Citizenship Scores
0%-25%
Vendor Selection Score Card
Global Sourcing Council
• It Pays off to run responsible business
• Consumers vote with their valets
• Investors minimize the risk/maximize returns
• Communities demand accountability
Sustainability is a risk factor with real and material valueENLIGHTENED SELFPRESERVATION
• Consumers Reward Sustainable Brands
• Consumers Vote with their Packets
• Nielsen Global Research 2014, 2015
• Sector-Based Experiences
Consumer Perspective
Around the World* Nielsen 2014 – 60 counties
67% - prefer to work for socially responsible companies
55% will pay extra for products and services from companies committed to positive social and environmental impact
52% made at least one purchase in the past six months from socially responsible companies
52% check product packaging to ensure sustainable impact
49% volunteer and/or donate to organizations engaged in social and environmental programs
• Returns/profits –
• Current results
• Growth & Development
• Future profits
Business Perspective
Profit ??????
Sustainability
• In 2014: Profit meets Sustainability
• Sustainability and Profitability are COMPLEMENTARY
• BCCCC -2014 Research of 750 Executives
• Ethical Corporation UK – 2014, 2015
5%Sales increase fromSR oriented consumers
Business Perspective
Global Sourcing Council
Sacrificing
current results
For Business Sustainability is theENLIGHTENED SELFPRESERVATION
sustainable brands are more profitable
FoxconnAPPLE – May 2010
Investors Perspective
• Sustainability as the risk mitigation strategy
• Shareholders resolutions to turn supply chains into responsible supply chains
FoxconnAPPLE – May 2010
Wanda Lopuch©[email protected]
Investors Perspective
2010 – Shanghai2012 - Mexico
Did Foxconn Bring Down Apple Stock?
Wanda Lopuch©[email protected]
StockRiters says: “The Foxconn riots and suicides have illustrated something all American companies with factories in (lower cost destination) countries should be strongly cautious about – that when American Consumers realize that behind the iPads they use, behind the bright LCDs and LEDs, the Nike shoes and the designer clothes they wear, that behind these there is an undernourished, underpaid, possibly underage laborer toiling away in some dank sweatshops (…) – that understanding has an immediate effect on the stock of the responsible company. A company that resorts to, condones, or ignores such business practices from its contractors, will get hurt where it matters most, its bottomline.
Wanda Lopuch©[email protected]
CIELAG, 14.10.2014; Monterrey, Mexico
“….it is sound financial astuteness to spend money on removing this sort of incidents from ever happening”
StockRider 2012
Supply Chain ManagementFinancial Risk Mitigation
Supply Chain ManagementFinancial Risk Mitigation
Wanda Lopuch©[email protected], 14.10.2014; Monterrey, Mexico
-October 2011 – MS Shareholders Meeting in NYC-Shareholders Resolution re. Socially Responsible Supply Chain
-Global Citizenship Standards-Auditing standards for Vendors Disclosure-Safety standards-Long-term compliance
Wanda Lopuch©[email protected]
Supply Chain ManagementFinancial Risk Mitigation
21/July 2016
Shareholder Resolutions
by the NYS Employees Investment Fund
Vendor Selection ScorecardSustainability is Enlightened Selfpreservations
Economic: 60-90% Cost Quality Delivery Capacity Flexibility Lead time Location Product development Technical/innovation Financial health Customer base
Environmental -5-25% Location Local regulations Compliance Value and culture
Social: 1% - 25% Reputation Social responsibility Environmental compliance Labor conditions Culture and values
Half Billion $$$ Challenge
to turn Supply Chains into Responsible Supply Chains
By Sept 25th 2017
Make a Pledge – Take Action
Angeline Judex, MPA.
Executive [email protected]
Wanda R. Lopuch, Ph.D.
Chair of the [email protected]
www.gscouncil.org www.gsc3sawards.com
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Creating a Sustainable Supply Chain:
The Time Has Come
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Angeline Judex, MPA.
Executive Director
Wanda R. Lopuch, Ph.D.
Chair of the Board
www.gscouncil.org
www.gsc3sawards.com
