The Mit Center For Transportation And Logistics (MIT CTL), a globally recognized leader in supply chain innovation and research, and the Council of Supply Chain Management Professionals (CSCMP), have jointly released the 2024 State of Supply Chain Sustainability report. This fifth edition of the highly regarded study provides critical insights into the evolution of sustainable practices within supply chains over the last half-decade. The report assesses the global adoption of these practices and their profound implications for various industries, supply chain professionals, and the environment at large.
Drawing upon four years of extensive international surveys, encompassing feedback from over 7,000 supply chain experts across more than 80 countries, and supplemented by executive interviews, this year’s report delves into the external factors compelling companies to prioritize sustainability. These pressures include escalating investor expectations and increasingly stringent climate regulations. However, the research also uncovers a persistent and concerning disparity: many organizations are setting ambitious sustainability targets, but are not making the necessary financial commitments to realize these goals, particularly in crucial areas like Scope 3 emissions reduction.
“Over the past five years, global supply chains have navigated unprecedented disruptions and complexities. While progress has been made, our analysis reveals a significant struggle for many companies to truly integrate their sustainability ambitions with tangible progress, especially concerning the challenging issue of Scope 3 emissions,” states Josué Velázquez Martínez, research scientist at MIT CTL and the lead investigator for the report. He further emphasizes, “Scope 3 emissions, which constitute the majority of a company’s carbon footprint, remain a substantial obstacle. The complexity of accurately tracking emissions from indirect supply chain activities, coupled with high margins of error in common estimation methods, can discourage companies from investing in greener alternatives and making truly sustainable choices.”
The 2024 State of Supply Chain Sustainability report reveals several key findings that are crucial for businesses and policymakers to consider:
- Investor Pressure Intensifies: Over the past five years, the demand from investors for enhanced supply chain sustainability has surged by 25 percent. This makes investor pressure the most rapidly growing catalyst for driving corporate sustainability initiatives.
- Net-Zero Readiness Gap: A significant 67 percent of surveyed firms have not established net-zero goals. Among those that have, a considerable number are demonstrably unprepared to achieve these ambitious targets, particularly when it comes to the complex task of measuring and effectively reducing Scope 3 emissions.
- Crisis Response and Sustainability: The report highlights the varying responses of companies to different types of crises in relation to their sustainability commitments. Whether facing network disruptions like the COVID-19 pandemic or periods of economic instability, companies react differently in their ability to maintain focus on their sustainability goals.
- Persistent Scope 3 Emission Challenges: Despite considerable efforts and growing awareness, Scope 3 emissions continue to be the most intractable aspect of corporate emissions management. These indirect emissions, often representing up to 75 percent of a company’s total emissions, are notoriously difficult to track and manage due to the intricate nature of global supplier networks and inconsistencies in data sharing across these networks.
Mark Baxa, President and CEO of CSCMP, underscores the critical need for collaborative action. “Businesses and consumers are increasingly demanding that products are sourced and supplied in a manner that aligns with stringent social and environmental standards. The State of Supply Chain Sustainability 2024 report delivers a comprehensive analysis of our current state of understanding. Crucially, it also provides invaluable insights into how we can refine our Scope 3 emissions accounting methodologies to achieve a more significant and impactful reduction in overall emissions.”
The report further emphasizes the pivotal role of technological advancements in driving sustainability progress. Innovations such as machine learning, sophisticated data analytics, and the adoption of standardized frameworks are essential for enhancing the accuracy of emissions tracking. These technologies empower firms to make data-informed sustainability decisions and accelerate their journey towards more sustainable supply chains.
The complete 2024 State of Supply Chain Sustainability report is publicly accessible online and available for download in PDF format at sustainable.mit.edu.
The MIT CTL stands as a preeminent global center for supply chain management research and education, boasting over five decades of impactful contributions to the field. The Center’s extensive work encompasses collaborative partnerships with industry leaders, pioneering research initiatives, and a steadfast commitment to advancing sustainable supply chain practices worldwide. CSCMP, established in 1963, is the leading global association dedicated to supply chain professionals, providing unparalleled education, research, and networking opportunities to foster the advancement of the supply chain management profession.
