Guide
Prioritizing
Because most companies (and particularly SMEs) are unable to simultaneously address all risks related to all of their products and services, prioritization is key. However, setting priorities should be a well-thought out process.
After this chapter:
- You understand the legitimate considerations that can influence processes of prioritization;
- You have selected one or two ‘pilot’ supply chains that will form the focus of your actions.
What should you prioritize?
International guidelines talk about prioritizing risks. Yet most companies are buying a wide range of products and services, and are therefore faced with an even wider range of risks. Therefore, we propose a first preliminary step that involves selecting a small number of ‘pilot supply chains’ that will form the focus of your actions, at least at first. For some companies (notably companies selling one or two key products or services), selecting pilot supply chains may be easier than for others (e.g. retailers selling a lot of different products).
How should you prioritize?
International guidelines refer to the severity of risks as the primary basis for prioritization. Severity depends on the scale, scope, and irremediability of negative impacts. While in some cases assessing the relative severity of risks may be rather straightforward, in other cases it is an exercise that is marred in practical and ethical challenges.
| Description | Less severe |
More severe | |
|---|---|---|---|
| Scale | How ‘bad’ is a potential adverse impact? | A 15-year-old boy working in his parents' shop. | A 10-year-old working in a coal mine |
| Scope | What is the magnitude of a potential adverse impact? | Partial expropriation of one household | Forced displacement of an entire community |
| Remediability | How difficult/easy is it to correct the adverse impact? | Improper dismissal of an employee. | Lung cancer resulting from long-term exposure to pollutants. |
While the severity of risks should undoubtedly play a key role in processes of prioritization, pragmatic and strategic considerations can play a role. For instance, priorities may shift according to the strategic nature of products or suppliers; the nature of your supplier relationship (and notably the leverage you have over suppliers); existing sustainability efforts; etc. While it is not wrong for these ‘other’ considerations to come into play, it is crucial that you are transparent about these considerations towards both internal and external stakeholders.
From the initial list of goods/services included in the 'Product analysis' sheet of your excel file, you now need to select at least one, but preferably more, pilot supply chain(s). These pilot supply chains will form the focus of your future actions. This decision should be made on the basis of the considerations listed below. Once you have made a final selection, you should briefly justify your selection in a few sentences in your word template.
- Severity of risks: based on the results of your preceding risk assessment (sheet 'Product analysis').
- Supplier relationship: Can you engage in a dialogue about human or environmental risks with suppliers? Do you have sufficient leverage to pressure your supplier(s) into taking action?
- Other strategic considerations: What is the strategic and commercial importance of the good/service/supplier? Are you already taking initiatives towards more sustainable procurement of these products/services?
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