- Data Analytics
- Machine Learning
Supply chain sustainability has grown steadily in the last half century. Companies today are setting more ambitious goals and investing greater resources. With this accelerated pace come new questions regarding the transparency of sustainability on an aggregate level. How and why have sustainability practices changed from 2020 to 2021? How has the COVID-19 pandemic impacted sustainability commitments by industry? Are there industry characteristics that can explain the differences in sustainability practices? To address these questions, our analysis used a combination of quantitative survey data and qualitative interviews with sustainability executives.
We used non-parametric Mann Whitney U tests of Likert scale data to quantify the change in supply chain sustainability initiatives. To understand the COVID-19 impact, we visualized summary statistics with Tableau dashboards. Then we ran non-parametric Kruskal-Wallis ANOVA tests to determine if industries differed in their sustainability commitment due to COVID-19. Lastly, we ran unlabeled k-means clustering on the Likert scale data to establish new profiles of companies based on their unique levels of sustainability behaviors.
We determined that supply chain sustainability on an aggregate level has continued to grow in 2021. Businesses doubled down on the issues most impacted by COVID-19: significant growth was seen in employee welfare and safety, human rights protection, and renewable energies. The fear of a sustainability retraction due to COVID-19 was unjustified. Both our executive interviews and empirical research showed that there was either no impact or an acceleration in sustainability promises. Our clustering identified six classes of industries based on their varying levels of sustainability commitment: Leaders, High Effort, Standard, Compliant, Dreamers, and Low Effort. The largest differentiators between the leaders in sustainability and those that lagged were company size and type. These clusters could be used in future research to understand the motivations for a company to adopt high standards in sustainability commitments.