While large corporations play a crucial role in improving ESG performance in global supply chains, managing suppliers through this prism presents significant challenges.

Overcoming these barriers requires long-term collaboration, investment in technology and training, and a willingness to engage suppliers at all levels.

Here are some ways big corporates can help their suppliers:

Training and education

Workshops and seminars: Organise training sessions on topics such as reducing carbon emissions, improving labour practices or implementing ethical governance policies.

ESG good practice guides: Provide resources, guides and case studies showcasing successful implementation of ESG initiatives

Financial support and incentives

Low-interest loans or grants: Provide financial support or subsidised loans for adopting cleaner technologies or improving working conditions.

Incentives for compliance: Create incentive programmes that reward suppliers for achieving certain ESG targets, such as sustainability bonuses or long-term contracts for performing suppliers.

Collaboration and co-innovation

Joint Research and Development Initiatives: Partner with suppliers to co-develop new technologies that reduce environmental impact, such as energy-efficient machinery or circular economy models.

Sharing knowledge: Facilitate the exchange of information and best practices between providers through forums, industry associations or online platforms.

Providing tools and technology

ESG reporting platforms: Give providers access to platforms that help them track and report ESG performance, facilitating better data collection and compliance.

Supply chain monitoring systems: Providing tools or software that improve visibility across the supply chain, enabling suppliers to track sustainability indices such as emissions or waste reduction.

Supplier development programmes

Mentoring programmes: Pairing suppliers with internal experts or external consultants who can guide them in ESG initiatives.

Transparent and fair audit processes

Collaborative audits: Turn audits into collaborative exercises where providers receive actionable feedback and resources to correct deficiencies.

Support for improvement: Rather than penalising suppliers for minor problems, offering support, training and time to correct non-compliance and meet ESG expectations.

Promoting local sourcing and ethical supply chains

Promoting local sourcing: Encourage suppliers to source materials and labour locally, reducing environmental impact through shorter supply chains and supporting local economies.

Ethical sourcing policies: Work with suppliers to establish ethical sourcing practices, such as using certified raw materials or ensuring that labour practices meet human rights standards.

Encouraging a Culture of Sustainability

You are an example: Demonstrate the company's internal sustainability initiatives and invite suppliers to observe or participate in these projects.

Communication and campaigns: Run joint sustainability campaigns with suppliers to promote common goals such as reducing plastic use or cutting emissions.