The State of Responsibility 2024 | Must Read “Based on the sheer volume of EcoVadis and Higg FEM audit requests I get from distributors, I’m surprised the $50M+ suppliers aren’t at 100%,” Mazze says. Companies who responded “Other” reported that their retail brand partners use third-party testing facilities. TABLE 4: Has your company adopted a code of conduct that reflects a commitment to responsible environmental, social and governance structures (such as the PPAI Code of Conduct)? Yes No Other PPAI 100 Suppliers: 94% 4% 2% Suppliers $100M+: 93% 7% 0% Suppliers $50M-$100M: 100% 0% 0% Suppliers $25M-$50M: 67% 17% 17% Suppliers $5M-$25M: 100% 0% 0% Suppliers Under $5M: 77% 15% 8% “From the outside looking in, it can be assumed that our industry doesn’t do much to mitigate the negative effects of our operations from the standpoint of how our products are used and marketed,” Sheffey says. “However, these numbers tell us that efforts are being made. We’re at a turning point, just like other industries have been before us. We can make the right changes that will have not only our operations more sustainable, but our industry as well.” “For as many as 40% of suppliers in the $25M-$50M category to have not yet initiated one or more of these certifications is hard to believe,” Harris says. “There is growing pressure on suppliers to not only become certified themselves, but also to ensure that their subcontractors do as well.” Mazze argues that the biggest concern for promo right now is the pressure to certify and assess rather than innovate. She cites a recent IBM study that indicates “spending on sustainability reporting exceeds spending on sustainability innovation by 43%.” “Distributors are putting a lot of pressure on suppliers to achieve these certifications,” Mazze says, “yet most of us in the $25M-$100M range only have one person dedicated to sustainability. It’s just not possible to juggle it all.” TABLE 6: Does your company have a sustainable packaging policy, such as recyclable, recycled, reused or compostable, etc.? Yes No Other PPAI 100 Suppliers: 85% 4% 10% Suppliers $100M+: 86% 0% 14% Suppliers $50M-$100M: 100% 0% 0% Suppliers $25M-$50M: 83% 17% 0% Suppliers $5M-$25M: 67% 0% 33% Suppliers Under $5M: 53% 33% 8% TABLE 5: Has your company engaged in audits in the environmental, social or governance realms, such as SMETA, BSCI, HIGG, EcoVadis or B Impact Assessment? Yes Audit Underway Beginning Shortly Not Yet PPAI 100 Suppliers: 75% 6% 9% 11% Suppliers $100M+: 79% 7% 0% 14% Suppliers $50M-$100M: 69% 6% 19% 6% Suppliers $25M-$50M: 60% 0% 0% 40% Suppliers $5M-$25M: 78% 11% 11% 0% Suppliers Under $5M: 58% 8% 0% 33% PPAI • SEPTEMBER 2024 • 73
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