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Sustainability performance is accelerating as more companies seek to reduce supply chain risks. SMEs in particular are speeding up their sustainability efforts. This is according to EcoVadis' annual Business Sustainability Risk & Performance Index.
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This Index is based on sustainability performance data from more than 83,000 assessments of nearly 53,000 companies in 800 value chains assessed by EcoVadis between 2017 and 2021. Organisations are scored on 21 sustainability criteria across four themes: Environment, Labour & Human Rights, Ethics and Sustainable Procurement. Scores range from zero to 100. Below 25 represents Inadequate (high risk), 25-44 represents Partial (medium risk), above 45 represents Good, and above 65 is Advanced.

More than 65% of companies achieve a performance level of Good or better, up from 50% in 2017. Meanwhile, the proportion of companies with Partial sustainability performance fell from 45% in 2017 to 32% in 2021.

“With increased regulatory pressure and ongoing supply chain disruptions, sustainability risks are coming more into the spotlight and organisations need to rethink their approach to their social and environmental commitments,” said Pierre-Francois Thaler, co-founder and co-CEO of EcoVadis. “We see the improvement accelerating as companies within our network progress further in their sustainability journeys.”

Although scores for Sustainable Procurement had historically declined, this year the theme saw a 1.2-point increase over 2020 (38.8 vs 37.6 respectively). Performance on labour and human rights was the highest of all themes with an average score of 52.2. However, there are still weaknesses in human rights due diligence in some sectors. Only 11% of companies conducted a supplier assessment and 5% an internal risk assessment of child and forced labour in 2021.

For more information, visit the EcoVadis website.