Making Sustainability Count: Study of Sedex Finds 372% ROI Over Three Years
A new study, conducted by Forrester Consulting on Sedex’s behalf, identifies the potential return on investment (ROI), cost savings and other linked benefits of Sedex.
Supply chain due diligence is often perceived as a daunting, resource-intensive and costly task, even when business leaders also recognise it as a priority.
Investors, legislators and consumers continue to pressure companies to operate more sustainably, and address the social and environmental impacts they contribute to in their supply chains. This pressure makes activities like supply chain mapping, supplier sustainability assessment and ESG risk analysis all the more necessary. Yet we often hear how difficult it can be for procurement and sustainability professionals to get buy-in from their senior stakeholders.
The 2023-commissioned Total Economic Impact™ study, conducted by Forrester Consulting, quantifies the significant ROI Sedex customers unlocked from core due diligence activities. It puts firm figures on this historically hard-to-measure aspect of corporate sustainability, by examining the potential operational and financial benefits available.
The study identified:
- Up to 70% reduction in supply chain sustainability management labour costs.
- Up to 2% of suppliers classified as high risk earlier, with associated cost savings.
- Avoided audit costs of $2,000 US dollars per supplier site — where recent audits already exist on the Sedex platform for suppliers’ worksites, companies can access these and avoid duplicating the assessments.
- $304,000 of at-risk profit retained, recognised as being at risk if a company fails to meet supply chain sustainability transparency requirements.
- 372% return on investment in total over three years, with payback on initial spend in just seven months.
These benefits were calculated for a composite organisation with $500 million in annual revenue, based on four Sedex members’ experiences and their reported results.
“We hope these insights will empower businesses and make it easier for senior executives to support ambitious sustainability programmes. It’s clearer than ever how such initiatives can fulfil both company performance and corporate sustainability goals, aligning with a ‘triple bottom line’ approach comprising social, planetary and financial targets.
“By leveraging Sedex’s network, existing supplier data, risk analysis and more, companies can deliver against their ESG commitments while reaping proven business benefits,”
Maurizio Capuzzo, Chief Marketing Officer, Sedex
The study’s findings challenge the assumption that supply chain sustainability is a net cost or without clear ROI. Alongside the quantified value, the study identified many related benefits that will be well-known to sustainability and procurement professionals already. These include increased supply chain visibility, improved resilience and a stronger, better-protected reputation for brands.
Ultimately, these insights equip professionals with the evidence to build a compelling case for supply chain sustainability and secure corporate buy-in.
“We are thrilled by the findings of Forrester’s study, which show the significant impact of Sedex’s solutions. We believe they underscore how we pave the way for leaders to streamline collaboration across supplier networks, proactively manage ESG processes and risks, and meet the latest regulatory demands. Our platform holds the potential for any enterprise to harness transformative results.”
Jon Hancock, CEO, Sedex
Read the full study to find out how Sedex helped these organizations gain a comprehensive and transparent view of their supplier sites, ensuring compliance with sustainability and ethical standards – or just ask us directly!
