The Importance of Ethical Supply Chains to Consumers


The world of business is changing and becoming more conscious and aware of its surroundings and how what they do influences current and potential customers. As a result, business models have to make the shift as well. This change extends down to material sources and the supply chains used to support the business. The importance of ethical supply chains among consumers is taking a prominent place, and companies need to start taking notice.

Millennials are all grown up. They’re settling down, having families, moving up in their careers, and becoming business owners. Two of the defining characteristics of the new generation of consumers are:

  • A high percentage of people concerned about social and environmental issues
  • A great deal more access to information than previous generations

This new class of customer can and will investigate the materials you source and the supply chains you use. Failing to audit assets and inventory networks may draw consumer ire, but conspicuously making an effort toward sustainable practices may draw positive attention.

Millennials are the Largest Market

Millennials have been transforming the workplace for the past decade or so, changing the business environment with new attitudes and a new sense of excitement. At times they have been scrutinized and even resented by previous generations, but the reality is that they are no longer the youngest generation on the scene, and they’re starting to mature into older and higher-ranking professionals.

They are the group that will necessarily transform the workplace and set the tone for the next generation. Millennials hold about 20 percent of all leadership roles. Millennial leaders will prioritize values, ethics, flexibility, and feedback, and maintain even stronger convictions than previous generations.

That’s why it’s so important that today’s businesses adjust to this influential group’s concerns and needs.

Social and Environmental Responsibility is Key

It’s just not enough anymore to fulfill a need. In our digital age, it’s easy to find any product or service. Unless you have no competition, many modern consumers prioritize companies that align with their beliefs. Keeping track of your resources, how you obtain them, and how you use them is a big part of maintaining an accountable and ethical business, and consumers are starting to tap into that.

For many millennials, that means patronizing or partnering with companies who are environmentally responsible, not involved with slave or child labor or other human rights abuses, or support a variety of other social causes. With information more widely available about companies and their practices, companies can no longer hide unethical or undesirable practices from their customers.

Word travels quickly – especially if it’s something controversial – and companies don’t want to find themselves the center of negative attention. The damage to the brand and the reputation of a company is often more significant than potential penalties or other civil liability. It can impact consumers, as well as investors, employees, applicants, and business partners.

In addition to reputational damage, reported abuses in a supply chain could cause a delay in bringing a product to market. The Fair Labor Standards Act would prohibit shipping goods in interstate commerce if they were produced with child labor or without paying minimum wages and overtime.

Track Every Aspect of Your Supply Chain

Part of running an ethical supply chain is ensuring that everything runs smoothly, from the equipment you own to the equipment you lease, to the contractors you use. With increased scrutiny, it’s important to audit every step of the journey of not only the products you make but the resources your company uses. Companies are seeing the value in working with contractors and suppliers that also have commitments to high labor and environment standards.

Today, supply chain transparency holds a prominent position in concerns for consumer and business, alike. Transparency has become an organizational effort in business, as it can impact various aspects of a value chain if neglected.

Branding a supply chain as ‘transparent’ and tracking every aspect can increase stakeholder happiness, minimize consumer concern and align an organization with positive social and environmental values. What’s most important is that companies are actively taking the measures to actualize transparency — within their strategies and actions.

Trust is a big factor when it comes to tracking your supply chain. Companies cannot expect their suppliers to act a certain way if they do not communicate these desired behaviors to them and exhibit them in their actions. True supply chain transparency entails visibility and traceability, not only on the product or retail level, but also at the supplier level, the raw material level, and the worker level.

Supply Chain Efficiency vs. Effectiveness

There is a difference in being efficient versus being useful for supply chains.

  • Supply chain efficiency is related to whether a company’s processes are harnessing resources in the best way possible, whether those resources are financial, human, technological or physical.
  • Supply chain effectiveness, on the other hand, is more externally focused on results.

In thinking about supply chain efficiency, companies are considering what happens within the supply chain system. The supply chain is efficient when it can get products at the lowest cost. They also may be looking at how well they can coordinate with others in their supply chain for various processes.

When a supply chain is effective, companies are looking in from the outside. Customers are looking at whether they got the right product in the right timeframe to meet their needs. Stakeholders might be looking at how much revenue was generated relative to the cost. Vendors and other business partners might also be looking at how well they can solve problems.

Supply chain systems are extremely complex. Every step a company makes can be a deciding factor on keeping, gaining or losing a customer. As a result, companies realize that not only must they do things right, they must also do the right things.

Companies rely on their assets every day. The process of tracking assets can be very time to consume, but thanks to technological advances such as mobile asset tracking, barcodes, barcode scanners, and customizable asset tracking software, the process is becoming more streamlined and efficient. For companies who invest in tracking technology, asset management benefits are proving to have a real return on their investment.

Asset Panda offers a plethora of asset management benefits to users who seek to manage all of their assets transparently. Asset Panda is highly configurable, so it can become whatever you need it to be and adjust as your needs change. Asset Panda works the way you do, making it easy for all your users to access the information they need, when they need it, from wherever they happen to be working.

Consumers are likely to respond no matter which supply chain improvements businesses choose to make. Adding a partner like Asset Panda to track a company’s assets and how they are sourced can make an impact for the good of the company and all who use their products and services.

Visit to learn more about what Asset Panda can offer your company when it comes to asset tracking and with a free 14-day trial.

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Audra London

Audra London, founder of Conceptual Communications, LLC, has over 10 years of writing, public relations and marketing experience and serves as an expert on press releases, media relations, feature writing, web content and marketing copy.

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