The Quest for Clean Supply Chains

OAKLAND, CA — Growing public scrutiny and consternation over the use of conflict minerals in everyday items like consumer electronics and jewelry provide just one example of the weak links in supply chains.

The points of vulnerability can exist throughout a supply chain, especially among global companies that mass market goods with materials and manufacturers all over the world.

Representatives for Disney, Hewlett Packard, the Responsible Sourcing Network and Pact Inc. took up the thorny topic of minimizing risks in global sourcing at the Ceres Conference in Oakland this week.

"These days supply chains are extremely complicated," said Assheton Stewart Carter, senior vice president  of global engagement and strategy at Pact Inc., who moderated the panel, "Chain Reaction: Minimizing Global Sourcing Risks."

The supply chain is international and "if even you can tell where something is coming from, finding out whether it was obtained ethically and responsibly also is extremely difficult," Carter said. "In the past five years, the risk has been shifting up and down the value chain. What was once just an issue for the manufacturing company is now an issue also for an OEM company or food manufacturing company."

Companies must also take into account the potential of negative unintended reactions of actions initiated with good intentions, such as unemployment in already poverty constrained areas because a region or raw material source is abandoned for a less controversial source another elsewhere. And all those considerations must be made despite a market that typically "cares more about quality and price than it does about environmental and sustainability issues," Carter said.

Mark Spears of Disney, like his fellow panelists, acknowledged the many challenges and cited a recent post by Ceres President Mindy Lubber in describing his firm's approach to global sourcing: "Acting in isolation is no longer an option," Spears quoted.

As the world's largest licensor (Disney works with 3,700 licensees in consumer products alone around the world), "our relationship with the product is tied to our relationship with the licensee," said Spears, director of sustainable business practices for Disney Consumer Products. Disney works with its licensees to ensure that products meet company standards, he said.