UK suppliers are in the top three for climate change resilience, according to a study by the CDP and Accenture.
Only suppliers in France and Japan rank higher than those in the UK, says the report, which ranked the world’s 11 major economies on their level of resilience to the business risks generated by climate change.
A lack of preparation leaves supply chains in Brazil, China, India and the US more vulnerable to climate risks than those in Europe and Japan, the research finds. However, suppliers in China and India deliver the greatest potential financial return on investment to reduce their greenhouse-gas emissions.
The CDP and Accenture collected climate and water data from 3,396 companies on behalf of 66 multinational purchasers to create a sustainability risk and response matrix to assess how prepared suppliers in 11 major economies are to mitigate and manage environmental risk.
It found that, despite relatively low levels of exposure to climate risks, suppliers in France, the UK, Spain and Germany were the most sustainable. Japan, meanwhile, is the only country with suppliers that are well equipped to respond to high climate risks, as the country’s supply chain has some of the highest levels of emissions reporting, target setting and climate risk awareness.
Suppliers in Brazil, Canada and India, by contrast, report fewer emission reduction initiatives than the global average.
The study says that, while the onus for improving suppliers’ performance lies with the large multinational companies, suppliers should recognise that it is in their interests to embrace more sustainable modes of operation. “Not only do these offer a means to reduce costs by driving efficiency in resource use, but sustainability is likely to become a key differentiator in the marketplace,” it concludes.
