Bob Walker

Companies spend enormous amounts of time debating sustainability strategy. They invest in emissions reduction. They launch environmental initiatives. They publish ESG reports. They set ambitious goals. Yet many overlook a simpler question: Who is helping shape those decisions in the boardroom? Recent research published in the Journal of Business Logistics suggests that board composition may influence environmental performance in ways that executives do not fully appreciate. The study examined more than 2,000 firm year observations across 306 publicly traded business-to-business companies. The researchers explored whether having a customer or supplier represented on the board of directors affected a firm’s environmental performance. The answer was yes. But not in the way many executives might expect. Most discussions about board diversity focus on demographics, functional expertise, or independence. This research points to another form of diversity that may be equally important: where directors sit within the supply chain. A customer and a supplier can look at the same sustainability decision and see very different priorities. Those priorities often shape the choices firms ultimately make. The researchers found that companies with customer affiliated directors generally achieved stronger environmental performance. Customer representatives appeared to bring market knowledge and external stakeholder expectations into board discussions.…

Dial P for Procurement host Kelly Barner recently displayed her expertise in supplier diversity in writing Empowering Supplier Diversity Managers to Succeed in all Economies for Supplier.io’s company Supplier Diversity Blog. Check out the entire article here.