EcoVadis’s new Sustainability Ratings Index, 10th Edition, highlights an interesting trend in supply chain management. The report scored over 100,000 companies on various sustainability factors in their supply chain management. They found that those who have been conducting assessments longer scored better than those just getting into the game:
“Ten years of Index data have established one thing with consistency: score improvement compounds with assessment frequency, particularly for SMEs. Among small companies, first-time raters average 53.4. Companies in the same size group completing their second or subsequent rating score 60.8. That 7.4-point gap – between two groups of companies that are otherwise comparable in scale and resource – is the compounding return on experience. Each assessment cycle builds documentation, embeds processes, and anchors sustainability practices into operational routines. It also gives companies a structured opportunity to identify gaps and prioritize the areas where improvement will have the most impact. The pattern holds across all size groups for reassessed companies: medium (100–499 employees) moves from 50.5 to 58.9, medium-large (500–999) from 52.7 to 61.5”
Companies approach sustainability in one of three ways. Either they are leaders and trailblazers, middle of the pack, or laggards. Being a leader is a risk. Obstacles must be overcome, processes must be created from scratch, and a lot of the time you aren’t going to get everything right on your first try. Those in the middle of the pack are often thought to have the advantage. By waiting, they allow the trailblazers to establish best practices and assume much of the risk. These results from EcoVadis call that conventional wisdom into question. It seems that experience counts for quite a lot. Those still waiting on the sidelines won’t be able to simply skip their way to maturity through learning from others. It seems there’s no substitute for hands-on learning.
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