Supply Chain Risk & Due Diligence

In today’s global marketplace, supply chain managers and procurement teams face multi-faceted challenges to ensure the resilience, cost-effectiveness, sustainability, and social responsibility of their supply chains. At Anthesis, the sustainability Activator, we support our client’s teams in addressing these challenges through holistic supply chain due diligence and risk management services, providing the tools and technologies to navigate complex supply chains, improve social and environmental responsibility, and proactively respond to risks and regulations. 

Defining Supply Chain Due Diligence 

Supply chain due diligence is the process by which an organization investigates and evaluates each stage within their supply chain to ensure ethical and responsible sourcing practices. This may extend anywhere from one Tier (or step) to tens of Tiers, depending on the complexity and geography of your organization.  

Historically, visibility into each stage of a supply chain was simple, when production was localized, and relationships were personal. Now, the fragmented nature of global supply chains means many companies lack visibility past their Tier 1 suppliers, and as a result face a variety of environmental and social risks within their supply chain, such as modern slavery and deforestation. Mapping and proper due diligence can provide the assurance and verification required to respond to these risks, align with voluntary frameworks like the UN Guiding Principles on Business and Human Rights (UNGPs), help fulfil regulatory requirements like the Uyghur Forced Labor Prevention Act (UFLPA), Securities and Exchange Commission (SEC) Climate Disclosure, German Supply Chain Due Diligence Act (LkSG), and ensure a resilient and sustainable supply chain. 

How we help clients

As a team of supply chain sustainability experts with in-depth knowledge of social and environmental risks and regulations, we are proud to offer a tailored approach to supply chain due diligence based on our client’s needs. Through our partnership we help clients to identify potential blind spots, ensure compliance and transform supply chain risks into opportunities. 

The Anthesis due diligence framework provides a holistic approach to sustainable supply chains. Our approach is multi-faceted and accounts for social, environmental, regulatory, and business impacts specific to the client’s industry.

Establishing the context & identify gaps: Building a shared vision of success and gathering the key stakeholders and materials we need to conduct supply chain due diligence. Activities could include a regulatory horizon scan and readiness assessment, stakeholder mapping, and value chain reviews. Using this information, identify where the organization is compliant and what gaps need addressed. 

Risk Assessments: Identify the material risks and impacts to the business with a high-level risk scan. For material risks, the impact and intensity of environmental, human rights and other factors are measured, in combination with the intensity of each risk, to determine the overall impact, and appropriately prioritize mitigation strategies. Risk assessments should be conducted regularly and as the business and supply landscapes shift.

Develop a strategy and plan for change: Create a tailored, strategic, and prioritized list of actions needed to conduct supply chain due diligence. Develop a roadmap to implement strategic initiatives and mitigate risks, and programs that close gaps, engage key stakeholders, and collect essential information about the organization’s supply chain. 

Enact strategy & build capabilities: Implement due diligence policies, programs, processes, data requirements, disclosures, and other actions through a change-centric and digitally agnostic approach. This will often include supply chain mapping, supplier data collection, tailored supplier engagement, executive education, policy drafting, governance building, risk mitigation and management, detailed risk assessments, impact assessments, climate transition planning, and more.  

Report: Develop robust reporting and disclosures that meet requirements and are bolstered by credible evidence packaged for audit purposes