Marine Supply Chain Sustainability – Speaking a Common Language
by Spiros Tsigaridas, Compliance and Sustainability Senior Manager, GP General Procurement
This article first appeared in Supply Chain and Sustainability Magazine, the Maritime magazine for @IMPA & IMPA SAVE.
Over the past decade, the marine supply industry has undergone a tremendous transformation. We have witnessed its adaptation to a number of challenges while it remained hungry for service excellence. Compared to other industries, the marine supply chain has a very large number of stakeholders due to its geographical coverage and the portfolio of products and services offered. Furthermore, it is vital in supporting the very infrastructure that transports 90% of all goods consumed worldwide – global shipping. However, despite the unique role in the Global Economy that it is tasked with, the marine supply chain sector fails to observe a common sustainability vision.
In order for the industry to achieve high levels of sustainability, it needs to unify under a common sustainability goal, adopting a common language to enable all stakeholders to apply themselves towards a better future. By implementing an agreed and comprehensible sustainability vocabulary, that unification becomes more easily achieved. At the same time, the supply chain is called upon to bring about change and take responsibility for its actions, therefore, it is imperative to address matters from within the chain’s internal structure.
Key stakeholders, such as vessel operators and ship managers, constantly raise the bar of expectations in regard to digitalization, automation, operational efficiency, product quality & consistency. In addition, they are rapidly introducing different requirements under their own unique ESG strategies, all of which the supply chain has to address and act upon. The ecosystem in which the sector operates is what actually makes it so unique. It has to ensure the uninterrupted delivery of thousands of different products and services of varying characteristics and quality, and all fulfilling end user sustainability strategies.
Especially in the field of digitalization and automation, we have witnessed notable progress which has led to operational improvements lately. On the one hand, these technological advancements have redefined the importance of technology as a change accelerator within the industry but, on the other hand, this acceleration has brought to the surface weaknesses in the sector such as poor communication and overall cultural gaps. Digitalization helps us work smarter, but communication is key, as we all need to face the same direction and set our compass bearings together. We have to sail forward in the right direction. The need for a common language is already here and we need to address it decisively.
The marine supply chain sector is required to address different ESG interpretations under a common platform. Its ultimate stakeholders – the vessels, their crew on board and personnel ashore – demand products and services which will comply with their own ESG targets. At the same time, the importance of responsible consumption and ethical business conduct are gradually becoming colossal. It is crucial to set the tone and communicate it across the board by collectively defining a common language that leaves no room for ambiguity. This will come by introducing a sustainability standard to which ship operators, ship managers, procurement pools, suppliers and service providers will be able to refer and take as a guide for setting the ESG goals of their own unique value chain. Essentially their corporate sustainability culture should be aligned with the standard, the lighthouse safeguarding all stakeholders within the supply chain to avoid crashing on the rocks.
Corporate transparency and responsibility are gaining constant ground. The industry’s stakeholders demonstrate a notable hunger for data accuracy, transparency, and traceability. This is enforced via digitalization and elaborate IT tools, another requirement of our times. However, these in themselves are not sufficient and require enhancement to bring a common culture into the foreground. The gradual adoption of globally or regionally accepted reporting standards is bringing to light the necessity for a common language and, most importantly, a collective sustainability culture.
The marine supply chain arena demands acceleration on all fronts towards a shared vision which must be structured, measurable and verifiable, and for this reason a bespoke sustainability standard is the right approach. We cannot afford misinterpretations of the ESG characteristics of products and services. Ultimately, the stakeholders depend on and require from their vendors the highest possible maturity in approach to sustainability. The lack of sustainability standardization will inevitably cause cultural differences. Moreover, these will further challenge the evolution of ESG to ESC (Environmental Social Consciousness) which is required more than ever today. The supply chain industry will struggle to meet all the expectations set by the end users and this will result in both operational and qualitative insufficiencies. The marine ecosystem is still in its sustainability infancy and cannot afford failures of such a nature, especially as it is now experiencing major disruption.
Our industry has proven itself visionary in the past and could therefore inspire other industries facing similar challenges to define their own common language. Despite its uniqueness, the marine supply chain shares many common structural characteristics, making it an ideal ecosystem to design and test a successful and well-thought standard. One to endure over time and to steer clear from greenwashing practices.
Its stakeholders across the globe should not only be part of its development but also active ambassadors of a collective effort thereafter. The latter will definitely bring acceleration on all sustainability pillars. With collective power comes immense responsibility towards protecting our planet and ethically supporting our communities. Under the auspices of an industry body with wide acceptance such as IMPA and the valuable input of industry specialists, the first of its kind Sustainability Standard for the Marine Supply Chain industry will definitely become a reference point for every stakeholder.
In the next edition, we will be tapping into Audit Protocols and the roadmap to sustainable partnerships, so stay tuned as another thought-provoking article is underway.