Identify Impacts

Conduct a conceptual life cycle mapping of materials

To grasp potential risks and opportunities across the life cycle of your materials, products, or services, start with conceptual life cycle mapping. Identify your key inputs, especially those commonly procured or costly, and assess their potential negative impacts. Data can be sourced from subject matter experts, public sources, suppliers¹, and other external stakeholders such as regulators and policymakers, NGOs, and industry bodies or trade associations. Quantifying and categorising these impacts will allow for easier comparisons and prioritisation. In addition, conducting a value chain-level hotspot analysis can provide a holistic view of the impact at different stages of your value chain. Define these stages, map the flow of your key inputs, and identify resultant impacts. Delving deeper into the underlying drivers, interconnections, and feedback loops using a systems lens can yield even more insights.

EXAMPLE: Apple develops Material Impact Profiles

Apple constructed Material Impact Profiles by cataloguing 45 common raw materials used in its products and evaluating their social, environmental, and supply impacts based on 16 indicators (see Appendix B). The materials were then assigned weighted scores, allowing Apple to focus on the ones with the highest impact and most significant consumption.²

EXAMPLE: Automotive Coalition Materials Heat Map

DRIVE Sustainability, an automotive coalition, developed an industry-level materials heat map. This tool assists companies in assessing their risk exposure across 37 widely used materials by pinpointing key impacts and sourcing regions. The map also encourages sustainability discussions and aids in setting shared industry priorities.^³

EXAMPLE: Walmart uses the THESIS Index to identify hotspots

Walmart utilises the THESIS Index to scrutinise the sustainability performance of its products. The tool enables Walmart and its 1,800 suppliers to identify social and environmental hotspots and continuously improve across 125 product categories. Suppliers can also gain insights into potential enhancements and understand their relative performance in the field.^⁴

Conduct a life cycle assessment on critical materials

Consider conducting a formal Life Cycle Assessment (LCA) for critical materials, products, or services, particularly if you plan to make sustainability claims or if the material is linked to deforestation, for instance. LCAs, ranging from basic qualitative overviews to comprehensive quantitative assessments⁵, can help pinpoint environmental and social impact hotspots. Streamlined LCAs are suitable for internal decision-making where you need to take a firm position, while a full LCA is optimal for validating sustainability claims externally. When performing an LCA, ensure it covers various impacts to avoid fragmented understanding. Integrate your LCA results into procurement processes by creating specifications or criteria based on identified thresholds or devising a scoring system that considers environmental performance. These strategies can transform your LCA from a one-off project into a routine procurement tool. Involve your marketing and communication teams to communicate the environmental performance of your products or services effectively.

EXAMPLE: Impossible Burger backs its sustainability claims with an environmental LCA

A third party conducted an ISO 14044 standard LCA for a plant-based meat substitute company, comparing the environmental impacts of their "Impossible Burger" to a conventional beef burger. The study revealed that the plant-based Burger significantly reduced water and land use, aquatic pollution, and GHG emissions.⁶