Gartner’s Sabu Mathai: ‘Sustainability Increasingly Builds Resilience’

Has supply chain sustainability run its course? Many businesses, faced with a seemingly endless torrent of disruptions, challenges and uncertainty over the past few years have put sustainability on the back burner. But, to Sabu Mathai, research director with Gartner’s Supply Chain Practice, sustainability is not a back-burner issue, but rather a mechanism that helps businesses overcome the challenges being presented.

“While turbulence and a lack of bandwidth contribute to this imbalance, so do perceptions that sustainability has marginal value to the business, or that sustainability and resilience are mutually exclusive rather than mutually reinforcing,” he wrote in a recent blog on Gartner.com. “To the contrary, progress on sustainability addresses downside environmental risks, including, for instance, from fast-moving changes in both environmental regulations and the environment itself (e.g., extreme weather, natural resource degradation). And with many supply chain leaders concerned that delayed progress on sustainability could result in lost market share, reaching for sustainability’s opportunities is crucial to mitigating risks and securing a better future for the business. Today, sustainability increasingly builds resilience.”

Mathai went on to argue that sustainability should remain core to business and pointed to Gartner research that found companies that “build in” sustainability at their core, rather than “bolting on” sustainability at the margins were more likely to see sustainability-related success.

“Leaders in build-in companies say their firms are 3.7 times less likely to deprioritize sustainability than leaders from bolt-on companies who face nearly equal rates of disruption,” he wrote.

That initial blog posting was followed by a more detailed Q&A with Mathai, released last week by Gartner. In that Q&A, Mathai addressed what organizations that can’t find a balance between sustainability and resilience could lose, how organizations can break out of the cycle of deferring sustainability initiatives and provided some recommendations for chief supply chain officers.

You can read the full Q&A here.

“There are growing downside risks from a continued imbalance between sustainability and resilience,” Mathai said. “Delayed progress on sustainability can leave organizations unprepared for environmental risks. Today, fast-moving changes in both environmental regulations and the environment itself (e.g., extreme weather, natural resource degradation) create increasing operational and strategic exposure for the supply chain and the entire enterprise.”

He cited a Gartner survey released in March that found 52% of leaders “cited competitive differentiation as their biggest motivation to increase supply chain sustainability over the coming three years.”

Mathai said making sustainability a “key aspect” of the business was crucial and advised not to set it aside during challenging times.

“Building in sustainability starts with a recognition of the growing connection between sustainability and resilience, but it goes further,” he said. “For instance, build-in companies take a whole-of-enterprise approach to explore the business case for sustainability. They see sustainability’s high costs in the context of the rising costs of inaction, and they lower the net costs of sustainability by finding new ways of doing business.”

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