Imagine that you’ve made your offices plastic-free and installed solar panels on the roof of your warehouse. Great job. And yet, paradoxically, your company might still be contributing massively to climate change. Why?
Because what happens within your walls is only the tip of the iceberg. The submerged part—the invisible and often overlooked one—is your supply chain. It’s there, in the trucks transporting your goods or in the factories of your sub-suppliers on the other side of the world, that up to 90% of your real impact is often hidden.
Ignoring the supply chain today doesn’t just mean having an incomplete view of your company’s sustainability impact, it means being blind to the biggest risks facing your business.
Rethinking the supply chain from a sustainability perspective therefore means extending your focus beyond direct operations and engaging suppliers and partners in a shared improvement journey. It’s a gradual change that delivers tangible environmental, social, and economic benefits.
Why the supply chain defines your sustainability profile
Your company’s sustainability profile doesn’t depend only on what happens under your direct control. Very often, the most significant impacts occur elsewhere—within the supply chain.
Greenhouse gas emissions are the most striking example. According to several studies, indirect emissions (Scope 3) occurring along the value chain, both upstream and downstream, can account for up to 80–90% of an organization’s total carbon footprint. This means that to significantly reduce overall emissions, optimizing internal processes is not enough: you must act on the supply chain.
Similarly, social impacts and risks can emerge along the supply chain. Poor working conditions, human rights violations, exploitative practices, and child labor may occur upstream. Ignoring these issues exposes companies to legal, reputational, and commercial risks, while addressing them in a structured way helps build a more resilient supply chain and significantly improves overall sustainability performance.
What is a sustainable supply chain?
A sustainable supply chain integrates environmental, social, and governance (ESG) criteria into everyday sourcing decisions—from supplier selection to logistics optimization, from waste reduction to ensuring decent working conditions throughout the value chain.
It means actively involving suppliers and partners in a shared path toward more responsible practices, protecting people, using natural resources more consciously, and continuously improving sustainability performance across the entire supply chain.
Beyond being an ethical commitment, a sustainable supply chain can generate economic benefits such as:
- reduced energy costs;
- greater resilience to risks;
- stronger reputation;
- access to new business opportunities.
Four steps to build a sustainable supply chain
1. You can’t manage what you can’t see: map the invisible
The first step is understanding how your supply chain is structured. Mapping the supply chain means identifying direct suppliers and, where possible, indirect ones, collecting information on geographic location, activities performed, and key processes. This provides a holistic view and helps identify major ESG impacts and the most relevant risks along the supply chain.
Based on this mapping, identify the suppliers on which to focus by considering their strategic importance to your business, the relevance of the ESG impacts they generate, and the level of risk associated with their activities.
2. Stop assuming and start measuring: data collection
An effective way to understand your suppliers’ sustainability practices is to ask them to complete self-assessment questionnaires. These structured tools are sent to suppliers, who then provide information on their practices: emissions monitoring, water and energy management, working conditions, certifications held, and supply chain traceability.
These questionnaires allow you to collect data in a standardized way, compare suppliers objectively, identify areas for improvement, and start a constructive dialogue around sustainability.
3. From control to partnership: support those who struggle
Sending out a questionnaire and expecting perfect data is not enough. The reality is that many suppliers—especially smaller SMEs—often lack the resources or technical skills to calculate their own carbon footprint. If you only demand data, you’ll receive inaccurate information or, worse, no response at all.
The real turning point comes when you move from being a “controller” to becoming a partner. Instead of imposing unrealistic standards, provide tools and support:
- organize practical webinars to explain how to collect data;
- share best practices or simplified software tools;
- reward virtuous suppliers with longer contracts or better commercial terms.
Transforming a struggling supplier into a sustainable one is less costly and less risky than having to find a new supplier from scratch.
4. This is not a one-off test: keep the focus high
A sustainable supply chain is not a fixed destination but a continuous improvement process. Define clear indicators—such as emissions per unit produced or the percentage of suppliers with environmental or social certifications—and review them regularly to assess real progress.
The information collected helps you identify new areas for action and guide future strategic decisions, making supply chain management increasingly effective and aligned with sustainability goals.
Progress doesn’t happen overnight: start with the first step
When you look at the complexity of your supply chain, it’s easy to feel overwhelmed. Hundreds of suppliers, missing data, constantly changing regulations—the temptation to postpone action is strong. But as we’ve seen, you don’t have to transform everything at once. The winning strategy is graduality.
Start with the 20% of suppliers that account for 80% of your risk (or impact). Test the approach with them, collect initial results, and only then expand the scope.
And this is where we come in. Tackling Scope 3 data collection and supplier engagement without technical support can quickly turn into a bureaucratic nightmare of unmanageable Excel files.
At Kyklos Carbon, we don’t just give you software—we help you make sense of complexity. We turn raw supply chain data into a clear strategy, identifying where to act to achieve the greatest impact with minimal operational effort. Do you already have an idea of which critical suppliers to start with?
Do you already have an idea of which critical suppliers to start with? Let’s talk. Contact us for an initial analysis of your supply chain and let’s build an action plan that’s sustainable for the environment—and for your business.
Sustainable supply chain: what it is and how to implement it