2:21 PM, March 1, 2024

The importance of evidence-based traceability

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| The European |

Ashish Gadnis, CEO and co-founder of BanQu, explains how to get ahead in a business world where environmental due diligence and total transparency are no longer optional

Action on climate change is at an all-time high, particularly in the EU, with some of the world’s largest companies – from H&M and Higg, to Shell, South Pole, and Verra – coming under fire for unfounded sustainability claims. The cost? Brand reputation, consumer trust, stakeholder value, astronomical fines, and harm to both people and planet. In light of recent EU due diligence regulations, these exposés will only continue. Compliance auditors are coming, and “out of sight, out of mind” approaches to sourcing and supply chains, no longer cut it.

Whether you’re aiming for net zero, compliance with deforestation-free supply chain requirements, or needing to prove sustainability claims to your investors, the solution is simple, yet urgent: you need evidence-based traceability, and you need it now.

How will evidence-based traceability help my business?

Evidence-based traceability is the ability to track and trace your ingredients or materials down to the source, with data tied throughout the entire chain of custody so you can prove exactly where it all originated. It is the key to saving your business from costly compliance mistakes and reputational harm. Th ere are three benefits to evidence-based traceability that will protect your business – so you can grow revenue while doing good – which are:

1) The ability to have a verifiable chain of custody that is completely auditable.

Source to shelf. Farm to fork. Ocean plastic to your upcycled water bottle. Th e ability to track an ingredient or material from A to Z is as revenue-driving as it is marketing-sexy. End-to-end traceability allows businesses to ensure the utmost quality, efficiency, and resilience of their supply chains while also giving them the information they need to back any sustainability claims. Even if your due diligence requirements don’t require getting all the way to the source, mapping the process will bring focus to your blind spots and build your capacity to pass audits on any claims you make. In today’s compliance-focused sourcing world, traceability gives businesses the ability to have this verified chain of custody that is completely auditable, protecting your business from the repercussions and bad press of an exposing audit.

2) Security in the knowledge that every sustainability claim is backed by the most trustworthy data.

At the heart of recent sustainability controversies lies a lack of trustworthy data. In some instances, false sustainability claims aren’t intentional – the brand was simply provided inaccurate data. Unfortunately, compliance auditors won’t consider whether you knew your claims were baseless. They’ll simply focus on whether the data backs your claims. With evidence-based traceability, brands can ensure that their end-to-end tracing is backed by the most real-time, trustworthy data to corroborate any claim or goal. This security is priceless, quite literally, as non-compliance fines can cost a company millions of dollars.

3) The peace of mind that you are in complete compliance with regulations.

From laws requiring deforestation-free supply chains, to regulations that determine from which area you can source cotton, compliance with ever-changing international and local regulations can feel like a moving target that could make or break your brand. Evidence-based traceability gives you the data you need to completely comply with any piece of legislation (granted you are not participating in illegal deforestation or human rights abuses to source your materials).

Evidence-based traceability allows you to track ingredients and raw materials back to the source

How can I kickstart evidence-based traceability for my business?

Despite its ability to multi-solve a myriad of business pain points, evidence-based traceability can take some time to implement. The most successful traceability initiatives start with supply chain mapping. How much of your supply chain, down to the source, do you know for certain? At each known tier, what information do you have about each manufacturer, factory, or supplier? Get as much detail as possible. Major bonus points if you can track an ingredient or material down to the geo-located coordinates of origin. Last, but certainly not least, I highly recommend partnering with a traceability solution provider so you can leverage their expertise along your journey.

What qualities should I look for in an evidence-based traceability partner?

As the business importance of compliance rises, traceability solutions are popping up all over the place. While it’s great to see the world take such a meaningful shift towards sustainability, it’s important to be able to discern the reliable offerings from the needlessly expensive ones. When evaluating a traceability partner, make sure they can provide you with:

  • Visibility down to the geo-located plot of land, as required by compliance regulations to pass audits. High-level satellite data and spot audits are no longer enough;
  • Data capture along the entire chain of custody from beginning to end, to ensure that even as your materials or ingredients move and transform that they’re remaining compliant and sustainable from point A to point Z.
  • Real-time reporting on sustainability data, so you can have the utmost peace of mind in your green claims and sustainability efforts, whether you’re looking to track and reduce GHG emissions or humane working conditions. Regardless of your business size, industry, or approach, one thing is clear: your business can no longer afford to be blind to the environmental and human impacts of your sourcing. So, whether you’re a fast fashion brand needing proof of your sustainable textile data, a gas company seeking to track and offset emissions, or a world-renowned beverage brand hoping to track source to shelf data, then evidence-based traceability is for you.

Further information

www.banqu.co

Watch The European’s interview with Ashish Gadnis here

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