The Ethics Series: Supply Chain Transparency and Business Sustainability
The Supply Chain Transparency and Business Sustainability workshop was organised by The Nigerian Economic Summit Group (NESG) in collaboration with the United Nations Global Compact Nigeria Network and Siemens Integrity Initiative.
The objective of the workshop was to discuss the transparency in Supply Chain Management in Nigeria and its impact on Business Sustainability. The event was moderated by Mr. Ladell Robbins, Vice President of African Alliance and chaired by Mr. Foluso Phillips, Chairman of the Board of the Nigerian Economic Summit Group (NESG). The supply chain of an organisation was identified as highly vulnerable to corruption, which may not be easy to detect or prevent. However, companies were encouraged to take measures to tackle corruption in their businesses.
Presentations were made by representatives of Centre for Public Policy Alternatives, Department for International Development (DFID)/Growth and Employment in States 4 (GEMS4), Guinness Nigeria Plc, Shell Nigeria and MTN Nigeria. Topics covered include Supply Chain Transparency: Policy and Business Case for Sustainability, Communicating for Transparency, De-Risking the Supply Chain: A Roadmap.
Supply Chain Transparency: Policy and Business Case for Sustainability presentation
The first presentation was anchored by Dr. Olufemi Olarewaju a Research Fellow at the Centre for Public Policy Alternatives. The topic presented was Supply Chain Transparency: Policy and Business Case for Sustainability. The presentation focused on issues such as leadership and communication.
Dr. Olufemi stated that corporate governance has a key role to play in ensuring business sustainability. By putting in place good corporate governance, proper structures and having right minded individuals in place, organisations can drive transparency and positive change in society.
According to the presenter, Nigeria is projected, to have a population of about 400 million people by 2050, with over 50% living in urban cities. This will pose challenges for businesses and policy makers, which effective communication and leadership can address. Businesses in Nigeria are well placed to resolve the social and economic problems faced in the economy as it was pointed out that some companies have a turnover of over $62 billion, which represented 25% of the country’s GDP at the time of the presentation.
He noted that in the sustainability sphere, the public sector is responsible for policy formulation and regulation, whilst the private sector is responsible for business solutions and strategic partnerships. He rounded off the presentation by saying that business, through good corporate governance and involvement in the policy making process, are more powerful in driving the sustainability agenda in our society.
Critical Elements in Supply Chain Sustainability and Management Presentation
The presentation on Critical Elements in Supply Chain Sustainability and Management was anchored by Mr Christopher Shyers, Team Leader at DFID/GEMS4. GEMS4 is a project funded by DFID, World Bank and the Nigerian government. The project is designed to promote economic growth, improvement and economic inclusiveness in Nigeria’s wholesale and retail sector.
He stated that there is an absence of an effective supply chain management in Nigeria, saying that 98.5% of trade in Nigeria does not involve the supply chain process. He went further to explain that many Nigerian manufacturers do not examine the process of how their products get to the customer. It led to his observation that the absence of Nigerian products from large retail store could be due to the many leakages in the system. He educated the participants on the 10 principles of the Global Compact and Supply Chain Sustainability which covered human rights, labour, environment and anti-corruption. He also made them aware of the four Ps of sustainable Supply Chain Management (SCM):
- Policy: Management commitment to a policy of sustainable supply chain management.
- Planning: SCM is cross functional requiring co-ordination and planning
- Processes/ Procedures: Establish management systems and operational guidelines for training and communication with internal and external stakeholders
- Performance monitoring: Establish an effective monitoring and evaluation system
In highlighting critical elements for Sustainable Supply Chain Management, Mr Shyers also presented the 4 A’s which are:
- Assess Self – (policy, planning, process/procedure, performance monitoring)
- Assess Risks
- Audit Self and suppliers – businesses need to audit their suppliers and monitor the quality of their suppliers
- Ability Strengthening or capacity development – training and technical assistance to supplier and service providers
De-Risking the Supply Chain: A Roadmap Presentation
Mr. Cephas Afebuameh, Supply Director of Guinness Nigeria Plc made his presentation titled De-Risking the Supply Chain: A Roadmap. He explained that the supply chain process involves demand and supply planning. He also added that the supply chain process is very complex and is vulnerable to several risks including:
- Volatility in Demand
- Changing regulatory landscape
- Increasing cost to service
The presentation highlighted the importance of companies understanding their operating environment. He also noted that businesses should have very clear Key Performance Indicators (KPIs) which would assist in setting up processes to manage risks. Performance measurement is critical to managing risks and promoting transparency. The use of tools such as risk matrix and SWOT analysis were recommended for analysing risks.
He stated that the Nigerian supply chain network is very complex and thus the risks present are more difficult to manage. Some steps were recommended to enable a business manage their risks, such as; simplification of networks, system evaluation and deployment of technology amongst others.
He went on to say that a de-risked supply chain would give business benefits such as simplified networks, efficient and cost-effective operations etc. This would result in satisfied partners and a responsive and sustainable performance.
Supply Chain Sustainability – the MTN Experience Presentation
Supply Chain Sustainability – The MTN experience was presented by Mrs. Uto Ukpanah, the company secretary of MTN. Her presentation highlighted MTN’s Sustainability model which cut across Human Rights & ICT, dignity in labour, the environment and sustainability in energy management. Salient points highlighted included their Human Rights policy which is tailored to the United Nations documents, mandatory minimum standards of labour, employment equity, human rights and environmental protection for its suppliers. Their environmental initiatives include environmental and safety assessments of operations of key suppliers and reduction in the use of physical recharge cards, while energy management includes a Carbon Emission Management Report and hybrid power solutions for BTS sites.
Supply Chain Communication for Transparency Presentation
The final presentation made by Dr Uwem Ite, Team Lead at Shell Nigeria was on Supply Chain: Communicating for Transparency. He highlighted that public reporting is a tool to stimulate and enhance sustainability and transparency of the business. He also noted that communication is crucial for establishing strong, functional and effective links. His presentation also covered Sustainability Reporting with focus on the Global Reporting Initiative (GRI). He linked the GRI Standards to supply chain management such as environmental & social impact assessment of suppliers.
He concluded by reiterating the importance of supply chain sustainability, public reporting to stimulate transparency in the supply chain, and sustainability reporting as a platform for communicating the outcomes of a supply chain transparency approach.