Every company, regardless of its size, has been affected by the COVID-19 pandemic, but an area where smaller enterprises appear to have been impacted more is supply chain sustainability. This is one of the findings of the second annual State of Supply Chain Sustainability report, which was published in July of 2021.
The MIT Center for Transportation & Logistics and the Council of Supply Chain Management Professionals launched the report in 2020 in response to increasing interest in the sustainability of supply chains. Companies have come to realize that supply chains are at heart of their efforts to meet the rising demand for sustainable products. Our research for the report comprises an international survey of supply chain professionals with over 2,400 respondents conducted in late 2020, 21 executive interviews, and an analysis of news and social media content.
The majority of companies of any size reported that they either increased (36%) or maintained (46%) their commitments to supply chain sustainability during the global Covid-19 pandemic. However, this level of support varied when we parsed the data according to company size. Eighty-seven percent of respondents from very large companies (10,000 employees plus) reported that their company increased or maintained their commitment to supply chain sustainability. A slightly smaller percentage (76%) of respondents from small companies (under 100 employees) answered the same way. We also looked at which respondents reported that they scaled back their supply chain sustainability commitments in the last year. Small companies represented the largest share of this group; 14% of smaller company respondents reported decreasing their commitment, compared to 6% of very large companies. (See below)
How has your firm's commitment to supply chain sustainability increased since the start of Covid-19?
It is encouraging that so many small companies seem to have maintained or even increased their supply chain sustainability commitments. But the data points also indicate that when faced with the global Covid-19 pandemic, more smaller companies were compelled to scale back their commitments to supply chain sustainability. This is understandable, given the unprecedented nature of the Covid-19 crisis.
The report also looks at which issues underpin companies’ supply chain sustainability efforts. Since we have done this in each of the two annual reports published, it is possible to draw year-on-year comparisons of the results. Of particular interest is that attention to climate change mitigation actually fell from 2019 to 2020, while attention to other issues grew. One possible explanation of this finding is that companies are swayed by high-profile issues. The 2021 report represents data from the 2020 survey. This means that we asked people about supply chain sustainability when the Covid-19 pandemic was raging, and at a time when issues of social justice were top of mind in the US and Europe, where most of our respondents came from. These dynamics may have influenced respondents’ evaluation of the importance of climate change efforts this year. We will know more in next year’s report when we ask the same questions.
The MIT CTL/CSCMP research team is laying the groundwork for the 2022 State of Supply Chain Sustainability report. The questionnaire will open in September this year. We are looking forward to exploring how committed small- to medium-sized enterprises have been to supply chain sustainability as the Covid-19 pandemic advanced.
The current report can be accessed for free at: https://sscs.mit.edu/