ESG ratings and research provider Sustainalytics announced today the launch of its Corporate Supply Chain ESG Solutions, aimed at enabling companies to assess and manage ESG risks within their supply chains.
As companies face increasing pressure from investors, customers, regulators and other stakeholders to improve and report on their sustainability profiles, understanding and managing ESG impact emanating from areas often beyond their direct control, such as the supply chain, forms a formidable challenge. Key sustainability issues often present in supply chains range from human rights and forced labor to workforce health and safety, and shortages of natural resources and greenhouse gas emissions.
Acquired by investment research firm Morningstar in 2020, Sustainalytics’ solutions have been targeted primarily to the investment and asset management sector. The new solution utilizes the same ESG risk ratings used by asset managers in order to enable companies understand their exposure to ESG risk by assessing suppliers’ ESG issues, and to conduct in-depth sustainability assessments of economic and social impact, including the activities of partners and suppliers. The solution also allows companies to review potential vendors and partners before entering new supplier or partnership agreements.
In addition to the identification of ESG risks and access to ratings, key features of the solution include the ability to map and filter companies by geography, risk category and other criteria, and tracking the performance of a portfolio of assessed companies to specific indicators, and to receive alerts when company ratings change. Sustainalytics also provides tailored frameworks for over 40 industries, and enables companies to be rated in a consistent manner, providing comparable ratings for companies across industries.
Francesca Placa, manager of corporate solutions at Sustainalytics, said:
“Corporate executives are asking their procurement leaders to assess the ESG risks of their suppliers and partners to limit risk exposure and comply with increasing regulation in supply chain operations. By providing a high-quality, standardized approach to assess company-level material ESG risks, Sustainalytics is well-positioned to help companies determine which suppliers may require the most in-depth evaluation on ESG issues.”
Click here to view Sustainalytics’ Supply Chain ESG Solutions.