Proper supply chain management can minimize risk

Risk management and reputation protection are two main drivers of supply chain management

Corporate social responsibility is one of the most important trends in business today. Companies around the nation are taking a close look at the way they do business both here and abroad. As these companies consider their supply chains, they are concerned with environmental issues, human rights and labor concerns, conflict minerals and more. Businesses have come to realize that risk management and reputation protection are key elements in supply chain management. 

Paula Ivey, president of The CSR Group, recently spoke about risk and supply chain management at the Commit Forum conference in New York. She emphasized the importance of risk management as a primary factor in managing corporate social responsibility. She recommended a proactive approach, citing transparency as one of the most important factors in protecting a company’s reputation.

“Corporate social responsibility is driving consumers, who are driving retailers, who are driving the brands,” Ivey said at the event, “CSR is going mainstream. Uptake is happening rapidly.”

Clearly, there are a number of groups that have a stake in corporate social responsibility. Not only are consumers interested in giving their business to companies that have the right reputation, but there is government oversight as well. The Dodd-Frank Act contains provisions that cover conflict minerals, for example, and there are a number of state laws that concern supply chain issues, such as human trafficking and unfair labor practices.

So, to protect themselves at both ends, companies must implement best practices in their supply chains, monitoring all links in the chain, keeping abreast on new developments, and creating a corporate culture that supports compliance and proactive change. In this way, companies can keep their reputations shiny and minimize their risk. 

Contributing Author

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Rich Steeves

Richard P. Steeves is Managing Editor of InsideCounsel magazine, where he covers the intellectual property and compliance arenas. Rich earned a B.A. in English Literature...

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