Like their larger counterparts, mid-sized manufacturers are under increasing pressure to demonstrate sustainable behavior and practices and responsible corporate governance.
To do so, they must consider and make sense of numerous and often complex evolving regulations and reporting requirements. They must also identify and track greenhouse gas (GHG) emissions and other sustainability-related data across their value chains to measure, manage and report on their stated goals.
In most cases, mid-sized businesses don't have the dedicated experts or teams (which large enterprises do) that are needed to navigate ESG complexities and collect relevant data from suppliers at all levels—right from raw material extraction.
To implement ESG requirements and accrue the benefits of full supply chain visibility, manufacturers require mature knowledge of ESG regulation, supply chain expertise and digital capabilities to extract and combine the relevant data from internal and external systems and sources.
Why data traceability is key
According to The Carbon Trust, up to 90% of an organization's environmental impact lies in the value chain — either upstream (supply chain) or downstream (product use phase). "Becoming a truly sustainable business depends on data traceability throughout the value chain," states Dr. Uwe Steinkoetter, Vice-President, Manufacturing.
"Traceability of data across the entire value chain enables simulating and implementing far-reaching optimization possibilities. In addition, it lays the foundation for a realistic carbon footprint and other relevant ESG criteria," he says. For instance, it can help to reduce emissions permanently and sustainably, optimize energy consumption according to demand and achieve significant cost savings across the supply chain and the company's production.
Traceability functions help to optimize performance, comply with local regulations and international standards and address sustainability holistically. By integrating ESG metrics into the corporate reporting structure in a targeted manner and in line with regulatory requirements, manufacturers can comprehensively monitor and control their carbon footprint and prepare for future supply chain requirements.
Driving forward sustainability with CGI
CGI helps clients advance and balance sustainability and financial growth, providing a practical approach to realizing long-term value. From developing strategies to unlocking data for better decisions, to accelerating innovation, we design for endurance.
We help clients identify and pursue new opportunities that come from better visibility and operation of their value chain, including their ecosystem of partners and suppliers. This encompasses tracking sustainability measures and addressing new challenges and ESG requirements arising from local and global regulations such as:
- Corporate Sustainability Reporting Directive (CSRD)
- Global Reporting Initiative (GRI)
- Germany’s Supply Chain Due Diligence Law, and
- DIN ISO 14001 Environmental Management
We provide our clients with an overview of the "ESG market," pinpoint specific requirements and tailor company-specific process design. We also support the selection and introduction of suitable digitization tools and solutions and their integration into the existing IT-OT system landscape.
Our consulting approach is based on rich knowledge gained from our experience across sectors, including manufacturing, logistics, insurance, defense and government, energy and utilities, and safety and health. From helping manufacturers develop a data strategy and governance to performing a data gap analysis, data sourcing and capture and ETL, to analytics insights and reporting, our services and solutions support:
- Analyzing and improving operations
- Changing product/service design
- Collaborating with partners
- Identifying opportunities for joint value creation
Partnering with Optel to advance our clients' supply chain traceability
As part of our widening scope of services, we have partnered with Optel, a leading global provider of supply chain traceability and track-and-trace technologies. The core of the joint, system-based consulting approach is the visualization software Optchain, a control tower for the supply chain that records, collects and displays all data. "Optchain is a results-driven, intelligent supply chain solution suite that delivers the right insights at the right time," says Martin Hirschbichler, Vice President, Optel GmbH.
This approach provides manufacturers with a clear, accurate and dynamic overview of the environmental impacts of their supply chains to take appropriate insight-led actions. They can then simulate different scenarios from the data pool to identify the option with the least ESG impact. Manufacturers can identify sub-suppliers and nodes in the value chain and use the database to assess whether an external audit might be appropriate. In addition, manufacturers can provide precise information on the ESG impacts of their products and provide information and data in accordance with the various reporting standards.