I spent the last six months having conversations with senior corporate leaders in the retail and consumer goods industry.
The effort was part of my work with the Sustainability Accounting Standards Board (SASB) developing industry sustainability standards.
Through the process, I gained an insight into the current state of corporate sustainability: how far it’s come in this sector, and how far it still needs to go. Here are three themes that emerged.
1. Supply chain has come a long way — but still has a long way to go
Arguably most of the environmental and social impacts in retail lie in its supply chain — the manufacturing of consumer goods.
These include issues like labor practices and safety conditions in factories, air pollution from manufacturing, chemical discharge into waterways, deforestation for leather production, and water stress in areas where cotton is grown.
The Rana Plaza building collapse in 2013 and human rights abuses linked to seafood sold at major retailers are a couple examples of the importance of these factors today.
Companies are working together and have come a long way in managing these issues. However, there still is no industry consensus around how they disclose their progress on these issues, and many companies still don’t know their full list of raw materials suppliers, opening themselves to risk.
When you browse the websites and annual reports of consumer goods companies, you’ll notice that companies discuss the same topics, such as factory audits, but use different…