ESG Disclosure and Risk in Supply Chain companies
Abstract
The pursuit of a sustainable economic model, urged by policymakers and financial markets, exposes companies to several challenges and risks: companies must reconsider their business model, disclose ESG performance, integrate sustainable practices from the three ESG pillars, and make investments to convert their business, i.e., finance the transition. The challenge is manifold.
The transition and the disclosure of ESG profiles require the implementation of information flows and organisational changes. This issue is increasingly pressing, given the current debate at the European level on the application of reporting obligations also for smaller firms.
Supply chains (SCs) serve as an ideal target group to investigate ESG disclosure and risks, as they involve different companies, from MNCs to SMEs and might have different levels of advancement in the integration of ESG in their business and in the awareness and readiness to face ESG disclosure and risk. While larger companies are generally more aware of the need to report and adapt to climate change regulation and are already implementing solutions, SMEs might be less prepared for these changes.
Additionally, the integration of sustainability also permeates the financial sphere of the supply chain. Innovative solutions to tackle ESG risk include Sustainable Supply Chain Finance instruments, as well as specific financial instruments designed to integrate the ESG risk of companies in the pricing.
This research project investigates: i. the advancement level of sustainable solutions and reporting systems for SC organisations; ii. the organisational and informational challenges faced by SC in dealing with ESG disclosure and risks; iii. the financial challenges faced by SC when integrating ESG into their business models.
All these aspects will allow us to shed light on the level of ESG disclosure and transition risk in the market and provide interesting managerial and policy implications.
Description of research unit
Coordinator: Alessandra Tanda (DEM Unipv)
Other researchers
- Alberto Francesconi, DEM Unipv
- Stefano Filomeni, Essex Business School (University of Essex, UK)
- Ana Ivanisevic Hernaus, University of Zagreb (Zagreb, Croatia)
- Tim King, University of Vaasa (Finland)
- Rossella Locatelli, Università dell’Insubria (Varese, Italy)
- Alla Petukhina, HTW Berlin - University of Applied Sciences (Berlin, Germany)
- Cristiana Schena, Università dell’Insubria (Varese, Italy)