Profit. People. Planet.
Known for decades as the triple bottom line, these 3 pillars of sustainability can radically boost performance, reputation, and margins — a fact companies across all industries are waking up to.
While consumers, government, NGOs, and other groups are applying increasing pressure on companies to adopt sustainability initiatives, it is also the ROI of such initiatives that is turning heads.
It is the fact that non-compliance costs around 3 times more than compliance.
It is the fact that technology now makes such initiatives achievable at lower cost and in less time than ever before.
And it is the fact that companies investing in sustainability outperform competitors in brand loyalty, annual growth rates, and profits, with sustainable consumer goods growing nearly 6 times faster than non-sustainable products.
But first, a cautionary note: the fad of “greenwashing” — that is, overstating a company’s environmentalism, ethics, and sustainability — does not fool or placate consumers like it used to, and backlash is swift and unforgiving.
True sustainability lies at the overlap of environmental, social, and economic sustainability efforts and requires each element to have equal importance.
Companies that fail to prioritize all 3 P’s put themselves in significant reputational peril.
Implementing the 3 P’s requires a comprehensive sustainability framework. With such a framework, your company can analyze performance, has full control over its sustainability ROI, protects its reputation and customer relationships, and proactively mitigates risk.
Particularly in the trust-deficient retail and fashion industry (and with consumer trends showing 65% of shoppers reporting the “need for trust” in their top 5 priorities), such visibility is imperative.
Below, we show what the 3 P’s of sustainability mean for the supply chain and how to integrate them using supply chain technology solutions — all in a way that is viable and effective.
What the 3 pillars of sustainability mean for the supply chain
In the context of your supply chain, sustainability means using resources in a way that lasts. It means generating profit while taking care of people and the environment. And in terms of business, it is “a strategic opportunity that can increase competitive advantage,” according to Odgers Berndtson.
The 3 P’s are defined as follows:
Profit refers to how your company affects the economies of localities, countries, and the international sphere in terms of wealth generation, tax revenue, innovation, and employment. It also accounts for how well it maximizes efficiency and quality while also cutting costs and delivery times.
This is your company’s effect on all stakeholders — customers, employees, supply chain workers, communities around production facilities, families, and others. Your company must take an active role in respecting workers’ rights and ensuring fair/ethical payment and employment.
This refers to the net total effect of your company on the natural environment. Examples of this metric include carbon footprint, waste output, pollution, resource and energy consumption, and impact on biodiversity, as well as positive activities like reforestation, waste removal, and natural restoration.
Creating supply chain sustainability requires all of the above components in equal measure; not just one or two. So how can your company do so in an effective way?
How to integrate the 3 P’s into your supply chain
Integrating, monitoring, and maintaining the 3 P’s of sustainability requires collaboration with suppliers across the entire production network. You will need to perform regular audits of your suppliers in order to maximize visibility and reduce risk — all of this requires digital supply chain technologies.
A digital solution creates a single source of truth where all stakeholders can access reliable data. This avoids misunderstandings, fosters better collaboration between supply chain players, and prevents you from missing a problem in the supply chain — an error that can have drastic consequences.
“A digitized supply chain strengthens capabilities in anticipating risk, achieving greater visibility and coordination across the supply chain, and managing issues that arise from growing product complexity.”
These are the steps to implement supply chain sustainability:
1. Define specifically what you will measure and monitor in the 3 P’s.
Write down exactly what actions your company takes related to each of the 3 P’s.
- When measuring Profit (the first P), tracking financial is well-trodden territory. However, digitized audits are one of the most effective tools at your disposal and allow you to track day-to-day supplier performance through technical and quality control audits.
- Assessing People (the second P) involves factors like fair pay, safe working conditions, ethical labor practices, equal opportunity employment, and so on. Vendor audits in the form of social, labor, and/or health & safety audits provide a reliable means of assessing this pillar.
- Finally, measuring the impact on the Planet (the third P) entails the use of environmental audits for carbon emissions, resource consumption, waste management, habitat and biodiversity protection, and more. A digital audit is necessary to obtain reliable sustainability data.
2. Audit regularly to ensure suppliers are hitting targets across all 3 P’s of sustainability.
You need to support your sustainability efforts with data, and data comes through audits.
One of the advantages of digital auditing is that it provides higher-integrity data more readily than traditional auditing.
Another benefit is that it allows for more regular and more thorough monitoring; this fixes one of the greatest problems with traditional audits, which is that they typically go into insufficient depth to actually identify large problems.
Your audits need to span the entire range of different concerns in order to provide full supply chain visibility in covering the 3 P’s. Particularly if you are a large brand, the number of audits this requires can appear prohibitively complex — an issue Inspectorio solves with our Rise platform.
3. After collecting data, extract meaning from it.
Without data, you cannot know the social and environmental impact of your company.
Data from standardized assessments lets you compare your supplier base in an objective way to see who is performing or underperforming. And because Rise automatically generates reports in a standardized format, comparing data is easy.
On Inspectorio Rise, assessment data undergoes autonomous analytics. This means you can gain insights from every bit of data you collect in a way that has simply not been possible until now.
Inspectorio Rise creates a single source of data so that all stakeholders work off the same information.
4. Manage risk.
There will be areas of non-conformance in any supply chain. Rise alerts you of such areas immediately and lets you communicate with suppliers in real-time to resolve them quickly — a level of supplier management necessary to stop an issue before it becomes a scandal.
By actively mitigating risk in your supply chain, and having the data to support it, you show your commitment to people and to the planet.
Auditing and data collection also expand the spectrum of your sustainability program, letting you adapt and improve over time.
Inspectorio Rise lets you collect data, build your own assessments to evaluate your supplier base, and report on social and environmental impacts in a completely transparent way.
This transforms your company from a talker to a doer, letting you forge a new path toward a more ethical and profitable future.
Inspectorio Rise makes sustainability easier
Inspectorio Rise helps companies implement, monitor, and grow sustainability initiatives across their entire supply chains. In addition to easily collaborate with all suppliers to ensure sustainable practices across your entire supply network.
As we have written, the growing tide of regulations, laws, and consumer demands makes true sustainability — and implementation of the Profit, People, Planet framework — an absolute necessity.
Manual auditing, reporting, and analysis are simply no longer feasible with the complexity of the average supply chain, particularly with today’s sustainability requirements. With Rise, you can collect vast amounts of data and receive real-time, actionable insights without having to manually analyze it.
Inspectorio Rise lets you:
- conduct all types of audits while centralizing and simplifying your operations
- score your suppliers using data and without bias, letting you identify your true top performers
- give all teams access to the same data for optimal decision making
- map out your supplier base to keep track of where each facility is located, what they produce, and how they’re performing