Two New Partnerships to Track Companies' Supply Chain Sustainability

This week saw the announcement of two new partnerships that promise to improve our ability to track the sustainability of companies' supply chains.

The one, between CSRHub and Source 44, and the other, between the Carbon Disclosure Project (CDP) and FirstCarbon Solutions, will combine supply chain data, analytics, and benchmarking to deeply elucidate the sustainability of companies' supply chains.

The partnership between CDP and FirstCarbon is an expansion of the work they have undertaken together over the past year. FirstCarbon, a supply chain analytics company, will analyze and benchmark emissions data from the 54 companies that participate in CDP Supply Chain, a program that measures and analyzes the impacts of climate change across corporate supply chains.

CDP estimates that over half of an average corporation's emissions come from its supply chain, while the other half come from its internal operations. As shareholders, consumers, and other stakeholders increasingly demand corporate transparency on sustainability issues, it is essential that companies have a way to track, measure, and report on their supply chains.

While the details of the partnership between Source 44 and CSRHub are still being fleshed out, the upshot of the collaboration will be to combine Source 44's extremely powerful analytics and visualization tools with CSRHub's massive database of companies' non-financial performance data.

Moreover, while CSRHub collects data on the world's largest 5,000 or so publicly traded companies, Source 44 has collected supply chain data from thousands of smaller companies. "We expect Source 44's impact to be most felt on smaller companies who supply to the largest companies we rate," wrote Bahar Gidwani, CSRHub's Co-Founder and CEO, in an e-mail.

The partnership announcements are particularly timely, as this week the Business & Human Rights Resource Centre brought renewed scrutiny on the discrepancy between electronics companies' claims of support for U.S. conflict minerals legislation while their business associations were lobbying against the very same legislation.

The specific legislation in question is the Dodd-Frank Act's section 1502, which concerns conflict minerals. Dodd-Frank 1502 will require companies registered with the U.S. Securities and Exchange Commission to perform supply chain due diligence on any minerals sourced from the Democratic Republic of Congo or adjacent countries.

In May, Global Witness, a UK-based NGO which investigates the role of natural resources in funding conflict and corruption, highlighted the ties between 11 electronics companies and business associations lobbying against the implementation of the Dodd-Frank Act provisions on conflict minerals in supply chains. Eliminating conflict minerals is a major imperative for companies seeking to clean up their supply chains.

IBM, which was highlighted by Global Witness, declined to respond to the paper. The technology giant is also conspicuously absent from the list of CDP Supply Chain members.

Another company named in the Global Witness paper was Acer. Unlike IBM, however, the Taiwanese multinational company does participate in CDP Supply Chain and responded thoroughly to the Global Witness paper.

"Although Acer is not publicly traded in the United States, Acer is in support of the conflict minerals provisions contained within the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Act)," wrote the company in a statement.

"Acer is aware of the concerns about the Act and its implementation which have been raised by the US Chamber of Commerce (the Chamber) and the National Association of Manufacturers (NAM). However, as Acer is not a member of either the Chamber or the NAM, we are not supporting or funding these organizations' activities."

Source 44, in partnership with CSRHub, recently conducted a webinar on conflict minerals, specifically addressing provisions of the Dodd-Frank act.

Image credit: Brian Harrington Spier on Flickr