Sustainable Value Chain –
the key to future-proof
business practices

Sustainable Value Chain –
the key to future-proof business practices

Sustainable Value Chain – the key to future-proof business practices

Today, companies are faced with the challenge – more than ever – of combining economic performance with social and ecological responsibility. The sustainable value chain is becoming the new linchpin for competitiveness and reputation. It not only describes how products are manufactured and services are provided, but also under what conditions – along the entire supply and value chain.

Legal requirements such as the German Supply Chain Due Diligence Act (LkSG), the European Supply Chain Act (CSDDD), the Corporate Sustainability Reporting Directive (CSRD), the EU Forced Labor Regulation, or new EU regulations on the EU Green Deal increase the pressure to make sustainability measurable and manageable – especially along the value chain. At the same time, the expectations of customers, investors, banks, and employees for transparent and responsible business processes and proactive sustainability management are growing. Those who invest today in fair working conditions, climate-friendly processes, and resource-saving technologies not only meet regulatory requirements but also create measurable added value. Sustainable business practices strengthen trust and meet the expectations of customers and partners, reduce long-term risks, and open up decisive, strategic competitive advantages.

This applies in particular to the implementation and achievement of sustainability goals for decarbonization. Here, the contribution from the value chain plays a special role and requires a specific focus on supply chain management. This is the only way to ensure the necessary coverage, quality, and reduction targets from the supply chain, in line with one’s own target matrix, or to adjust the supplier matrix accordingly if necessary. However, it is particularly important here to consider the customer’s perspective and their target achievement matrix for decarbonization, as from this perspective, one is only one supplier among many (mirrored perspective) who must be able to offer the necessary quality and coverage, coupled with sufficiently ambitious reduction plans, at the right time for the customer. If this does not align, the business volume with this customer can quickly be jeopardized. It is crucial to position oneself strategically and in good time, and to take the necessary steps early. Your customers expect a partnership at eye level. This is a great strategic opportunity right now to strengthen customer loyalty and highlight your own importance to the customer. Future viability begins with responsibility and management along the entire value chain. Only in this way can today’s customer relationships and your own market positioning remain viable in the future.

This is precisely where our consulting approach to the sustainable value chain comes in.

Risk Analysis & Due Diligence Management

How well do we know our upstream value chain?
What risks are hidden there?
We identify and assess ESG risks along the supply chain (e.g., geopolitical tensions, raw material shortages, extreme weather events, and human rights violations). From this, we create risk profiles and develop processes for continuous monitoring. We use proven tools and industry-specific indicators. This enables our clients to determine the extent of their risk and then actively manage their supply chains. This capability allows our clients to address both regulatory requirements and the expectations of their stakeholders.

Regulatory compliance readiness check

Do we meet the regulatory requirements of LKSG, CSDDD, EUDR, EUFLR?
We compare the regulatory requirements with our clients’ current capabilities and circumstances and create a corresponding heatmap. From this, we derive a pragmatic approach to close existing gaps.

Sustainability-Oriented Product Portfolio Alignment

Which part of our revenue is potentially jeopardized by our customers’ sustainability requirements (e.g., PCF)?
How can we further develop our products to remain competitive or even avoid delisting?
We analyze our clients’ customer portfolios and cluster them according to customer expectations regarding sustainability (e.g., PCF) with respect to the urgency of action to avoid potential business losses. This analysis results in a heatmap that clearly shows the risk and the urgency of action. Based on this, we work with our clients to develop the further course of action to promptly meet the various requirements of their customers while enabling efficient implementation.

PCF-based Supply Chain Management

To what extent is our supply chain capable of providing robust PCF information?
How do we manage the supply chain to meet our own decarbonization targets?
Together with you, we determine the CO2-relevant weighting of your purchasing portfolio and identify the corresponding hotspots – both at the raw material and supplier level. We develop approaches with you to close gaps and determine the quality of existing PCF information. We work with you to develop necessary approaches for interacting with your suppliers so that they provide you with the right quality and appropriate reduction plans in a timely manner to achieve your decarbonization goals. This, of course, takes into account your customers’ expectations on this topic.

Sustainable Procurement & Supplier Management

What aspects must our supplier management fulfill beyond a pure PCF consideration?
How can we manage our suppliers to address our holistic sustainability goals and customer expectations?
Together with you, we analyze the extent to which you have realized the holistic approach required today in the sustainability topics of Environment, Social, and Governance (ESG) in your approach to managing your supply chain. More and more laws in the EU already demand this today. From this analysis, we work with you to develop an approach that realizes ESG-compliant supplier selection, management, and incentivization. This includes corresponding approaches for active risk analysis with coordinated prevention measures and integration into your tenders.

Traceability & Transparency in the Supply Chain

Can we sufficiently trace purchased products and services?
Which parts of our purchasing portfolio are to be considered critical?
Together with you, we examine your purchasing portfolio and identify existing gaps and critical aspects along the value chain. These may include, among other things, that sub-steps of upstream production take place in countries or regions with high environmental risks or human rights violations, or that upstream production sites have an increased risk due to climate change. In collaboration with you, we develop concepts on how robust traceability can be efficiently established – from data collection and supplier integration to the possible implementation of digital solutions. All of this also with regard to future regulatory requirements (e.g., DPP Digital Product Passport).

Complaint Management

Do we systematically collect and analyze complaints from customers and other stakeholders?
Are we able to locate and consistently address reasons for complaints in the supply chain?
Together with you, we analyze your risk & stakeholder landscape as well as your complaint management system – a central component of responsible corporate governance and risk management of your value chain – both upstream and downstream. We work with you to develop an approach to adapt your complaint system and associated processes to regulatory requirements (e.g., low-threshold and confidential accessibility, transparent documentation, clearly established processes for handling complaints in terms of content and timing) as well as customer expectations, and to derive effective prevention and remedial measures. Only those who take complaints seriously and resolve them transparently and sustainably build trust, increase customer loyalty and their corporate image, and meet regulatory requirements, also in the case of official audits, where we can also support you.