INSIGHT 2
Confidence in supply chain transparency and visibility is improving
Supply chain transparency is not a new concept, but until recent years, markets and organizations have lacked both the impetus and ability to invest in making effective improvements. Today, prompted by factors such as consumer demand, the need to manage risks and build resilience, and enabled by ever-emerging technology solutions, transparency is a critical component of supply chain management.
The data tells a positive story, with 82% of global CEOs professing sufficient visibility and transparency to inform decision-making. However, as organization size increases, this confidence decreases, with CEOs from the largest participating organizations professing a lower 70%. Still, this figure is up on the overall 60% last year. Transparency is going mainstream, even if the means to achieve it still vary.
Leading the way are CEOs from the Automotive sector, with 91%, which could reflect the sector's maturity and investment in supply chain automation. Conversely, Manufacturing (71%) and Retail (71%) have the lowest confidence, which again may reflect supply constructs over multiple “tiers,” whereby opaqueness emerges as more suppliers are added to each chain.
Over two-thirds of CEOs are concerned about the potential for human rights abuses in their supply chain, the number increasing slightly, from 66% last year to 70%. This could correlate with the improvement made in transparency and visibility. However, the ‘concern’ associated with the response suggests that uncertainty remains about addressing it. Furthermore, the highest concern came from CEOs in Utilities (78%), Manufacturing (77%), Raw Materials (75%), and Retail (75%) – sectors that have had their fair share of publicity around human and labor rights issues in recent years.
The human rights group Walk Free and the International Organization for Migration reported that an estimated 21.3 million people were living under forced labor in 2022, up from 20.1 million in 2016. Additionally, more than $460 billion in goods potentially linked to forced labor is imported into G20 nations annually.
Therefore, the CEOs' involvement does not stop with greater transparency. There is a need for active intervention and management of the revealed landscape.
