Can suppliers meet retailers' rising sustainability expectations?

In Part 1 of this two-part series, Marc Major provided an overview of retailers' efforts to embrace sustainability. This is Part 2.

As retailers lay out their sustainability expectations, supplier reactions vary. We’ve seen the full range of emotions famously described by Elizabeth Kubler-Ross’ five stages of grief — from denial and anger through bargaining and depression and finally to acceptance of the inevitable. In our experience, nimble and adaptable companies move through these stages relatively quickly, and the best transcend a negative mindset altogether to embrace the upside of sustainability.

This pattern does not surprise John Fojut. Vice President of Corporate Sustainability at Kohl's Corporation, Fojut sees a clear segmentation among suppliers and their approach to sustainability. "Our vendors fall into 3 buckets. They either consider [sustainability] part of their core values, they see it as something that gives them competitive advantage, or they just see it as something they have to comply with.”

A positive attitude — rooted in the realization that improved environmental and social performance can help make any business smarter, stronger, and more profitable — is an excellent foundation for future growth. Why? Because long-term viability depends on continuous improvement and innovation, which includes enhanced sustainability.

Fojut observes that vendors who adopt a positive, proactive mindset are well-rewarded. "Instead of having to react and adapt to someone else's priorities — like when some companies got surprised by the rising tide of consumer concern about social responsibility — [we’re all discovering it’s better to] get ahead of the curve and come together to agree on what's important and what progress we want to drive."

Overall, he reports, Kohl’s suppliers are making progress. “We've been talking about this for 5 years and we see some good movement. Suppliers are shifting from thinking it's all about compliance to seeing that it can add value to their businesses." Perhaps most significantly, suppliers are also starting to cascade sustainability upstream into the rest of the supply chain. “We have a sizeable group now asking their own suppliers sustainability questions. This is where we wanted it to go."

Next page: Target takes aim at suppliers