🔎The Issue

Sourcing materials responsibly has become a growing concern within supply chain management. As supply chains expand into low- and middle-income countries, the attraction of lower production costs and higher yields increase the risks of harming local communities and ecosystems. This can result from stressing natural resources and exploiting workers throughout the supply chain.

As all SMEs require materials in some form, evaluating where materials come from and how they travel through the supply chain is essential for corporate social responsibility. SMEs are responsible for ensuring products are created using environmentally-conscious materials and processes while labour has been responsibly sourced.

🏆 The Goals

1. To reduce and eliminate any environmental, social, and ethical issues within the supply chain by sourcing from reputable suppliers.

<aside> 💡 What does it mean in practice?

It means replacing materials sourced from child or forced labour with materials sourced from consensual and fairly rewarded labour, which removes the need for child labour. Furthermore, opting for less energy-intensive materials or those requiring shorter refinement processes will reduce stress on natural resources within the supply chain.

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💓 The Reason

Sourcing materials responsibly and ethically is essential for ensuring healthy environments with none to minimal pollution of water, soil, and air. This is significant for public health and for wildlife to continue to have enough habitat to survive. We are reliant on the natural world for oxygen, food, building materials, and recreation. However, when materials are sourced irresponsibly, i.e. through over-extraction, contamination of local areas, with use of forced labour; then we deplete the building blocks we rely on for our existence. Ensuring responsible sourcing of materials is not just a lifeline for keeping the environment livable, but opens the door to developing strong supplier relationships and increasing consumer attractiveness.

🥇 **The Benefits

⚖️ Legality

Responsible sourcing means less likelihood of breaching environmental regulations along with associated fines and potential legal action against the SME - saves costs and reduces the potential for legal harm against the company.

✅ Brand protection

🫣 Future preparedness

Responsible sourcing creates brand protection - consumers are likelier to purchase from companies with a good reputation for avoiding unsustainable practices.

Responsible sourcing ensures that the materials you rely on for your company's success and personal well-being are not depleted, and ensures sustained use for the future.

💹 The Measure

Use these questions to assess your SME’s journey towards improving responsible sourcing:

• Determining aspects of sustainable material sourcing that apply to the individual SME:
  • How and where are the products made?
  • What materials are being used?
  • How are the products transported?
  • Who is involved in the production line?
  • Does your supplier hold any reputation or certification for sustainable and ethical production?
• Discussing opportunities to switch materials to those certified by a regulatory body or from local suppliers enables SMEs to prioritise the origin of their materials.
• Engaging with suppliers on expectations and standards for creating ethical supply chains can be a key step in responsible sourcing, as tracing company performance can be difficult for SMEs when sourcing materials globally.

<aside> 💡 Did you know?

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The Welsh Government provided a sustainable procurement strategy in 2022, allowing the public sector to follow frameworks to incorporate sustainable strategies into individual procurement plans. If you supply to the public sector, you might likely be asked whether your products are sustainable.

💪 **The Tasks

• [ ] Working with certification standards and only using suppliers with reputable and current certifications in material harvesting and transportation methods minimises the risk of using unsustainable sourcing.
  • For example, is the paper used by the company FSC-certified?
  • For example, are food products certified by the Rainforest Alliance?
  • For example, do suppliers possess an ISO 140001:2015 certificate?
  • For example, are the buildings used in production by the supplier [BREEAM](https://bregroup.com/products/breeam/#:~:text=BREEAM is the world's leading,construction%2C to use and refurbishment.), LEED, or DREAM compliant?
• [ ] Each material may have its standards for ethical sourcing, all of which cannot be covered here. As such, it is important to determine what standards are relevant for the type of materials used within the SME.
• [ ] Local material sourcing ensures that government standards are followed throughout the supply chain.
• [ ] Opt for recycled or reused materials to reduce external sourcing, including creating new materials.
• [ ] Follow the waste hierarchy to first refuse to buy something if unnecessary, then reduce, reuse, repurpose, repair, recycle, and as a last resort dispose.

📑Resources