Supply Chain Empowerment Learn how to correctly analyse this topic.

Sarah Simon

19 min Read Time | May 23rd 2022

Key takeaways


The topic deals with projects and activities that have a proven positive and direct impact on the company’s supply chain and promote the local development of the communities the workers live in.


The core focus should be on how activities promote, foster, and develop the communities' living standards, access to resources, inclusion, and well-being.


This topic may include philanthropic initiatives or donations as a secondary point.

Executive Summary

This topic addresses how a company empowers people and communities in its own supply chain. Empowerment and securing livelihoods can be addressed mainly through the company's core business activities.

It also includes a company’s ability to ensure diverse suppliers' access to resources and livelihoods, specifically in the context of underserved population groups. It includes, but is not limited to, smallholders and farmers, women, indigenous businesses, local suppliers in the supply chain and emerging markets.

If the impact is significant, the analysis can also discuss empowerment through the company's initiatives, projects, opportunities, etc.

The empowerment of the supply chain includes, but is not limited to:

  • Skills and training  - that helps workers and their communities gain resilience and security
  • Microloans - helps stabilise income flows and savings
  • Local sourcing - aids in poverty reduction and economic growth 
  • Diverse supplier spending - fosters diversity and inclusion of minority groups

This topic is not focused on minorities or gender equality as such; this can be added as a secondary point to the analysis. The focus is on the supply chain as a whole, and how the company's activities, projects, and initiatives empower the members in their supply chain and the communities that they live in.

What is it?

Supply chains are crucial for the global economy and businesses. The supply chain can be defined as a “network between a company and its suppliers to produce and distribute a specific product to the final buyer. This network includes different activities, people, entities, information, and resources.”

Empowering members of the Supply Chain promotes and develops strong community relations and compliance with fundamental rights.

Empowerment can be defined in different ways. When talking about underserved populations, lower-income people, rural populations, women and minorities’ empowerment, it means accepting and allowing all people who are on the outside of the decision-making process into it. Empowerment is the process that creates power in individuals over their own lives, society, and their communities. It is all about equipping and allowing people to make life-determining decisions.

The opposite of empowerment is degradation, “the act of lowering something or someone to a less respected state.”

Being firmly interconnected with rights, inclusion and empowerment increases access to food, healthcare, education, land, clean water, and more vital resources for increasing wellbeing.

Being civically and socially responsible can be the driving force for local development (LD). LD is a social science theory based on “the identification and use of the resources and endogenous potentialities of a community, neighborhood, city, municipality or equivalent.” Both economic and non-economic factors can influence LD.

The economic factors might include: purchasing materials and supplies from the local communities, creating job opportunities, fostering local endowments, strengthening local financial assets.

Non-economic factors include: “social, cultural, historical, institutional, and geographical aspects.” In other words, encouraging local development through building strong, empowered, and resilient communities.

SDG 1 No Poverty


✅ SDG 1

✅ Impact Category: Processes

Exception - Products

  • Agricultural Products
  • Chemicals

✅ ILG: Basic Needs

Data Points & Units

Data we are looking for:

  • Only data from 2022 is accepted - if unavailable, you can use 2021 but no later than that

  • Number of people in the company’s supply chain

  • Comprehensive initiatives the company has in place to empower its suppliers

  • How have these initiatives impacted suppliers? Are crop yields higher? Farmers’ incomes more stable?

  • How many people benefitted (reach)?

  • How long have the initiatives been happening? Is there a good reason to believe they will continue (persistence)?

  • If treating diverse/local suppliers we need to know the % they represent from the total.

Some definitions:

  • Disclosed: when the data is directly disclosed by the company, i.e., we did not do any calculations/estimations to obtain the figure

  • Estimated: when we have calculated the figure

  • Complete: when the data represents 100% of the company’s operations

  • Partial: when the data is given for only a portion of its operations (not 100%)


  • We want to have homogenous and comparable units.

  • We accept financial values in USD or Euros but not both in the same analyses.

  • Make sure to mention the currency the first time you use a monetary value. Later you can use just the currency symbol. For example: “Company A invested USD 100,000 in its total supply chain and $80,000 in local suppliers

Impact assessment

In your analysis, describe the project/initiative(s): the what, how much, and the who, following the IMP framework.

You must mention the direct and intended impact of the company's actions and measure how significant it is.

Learn more in the article Step 5: Assess scale and value.


The introduction should provide background information about the importance of a resilient supply chain and the wider social impact this would have on the communities they are part of.

  • Discuss the vulnerability of supply chain workers that is industry-specific

  • It should consider the relevant geographical areas the impact is in

  • Consider the ways empowerment of such groups boosts community well-being

Read more on how to build a strong introduction in this article.

Core Analysis

The body shall explore the direct company’s action/project/program, delineating:

  • The number of suppliers the company has, and if possible, the number of employees in the supply chain (indirect employees)

  • What types of jobs do the workers have in the company’s direct supply chain

  • What the geographical reach is

  • How the workers and communities are empowered, through, for example:
    • Microloans

    • Fairtrade and fair purchasing contracts and practices

    • Skills, such as farming, economic training, sustainable and responsible practices, etc.

    • Increased decision making

    • Local sourcing

  • Since when and for how long workers and communities have been positively impacted

  • How many people were actually reached and impacted

  • The tangible outcomes and impact, such as:
    • Reduced poverty rates in one area

    • Increased security and access to resources (financial, food, employment, water, and other resources)

    • Increased ownership, such as land

    • Stable income and increased profits

It would be valuable to know how the company is driving its policies into the supply chain.

Rather than conducting relative impact assessments (representation as a percentage or only compared to the industry), an absolute impact assessment needs to be made. You should report on how the company is empowering or degrading underserved populations in absolute terms, such as systemic changes brought about by the company or in its supply chain.

What the company is doing that is helping or hurting women's standing in society, such as:

  • Whether the supply chain upholds what societal norms and standards accept as 'appropriate' jobs for the underserved population.

  • Are they working in the lowest-paid quartiles?

  • Are women vulnerable to sexual harassment and violence? Are there security threats when traveling during non-conventional working hours? Are the women's care responsibilities paid for?

  • Do the underserved communities have limited bargaining power? Are they underrepresented in unions?

  • Within the supply chain, is the spending for diverse suppliers significant compared to non-diverse suppliers?

Regarding inclusion, the analysis can discuss one or more ways the company has proactively built a diverse and empowered workforce in the supply chain:

  • Strengthening anti-discriminatory policies

  • Eliminating bias in the evaluation process and promotion opportunities

  • Spending significant amounts on diverse supplier groups

  • Cross-training programs, training, microloans, fair trade, local sourcing, etc.

  • Other initiatives such as fostering diverse thinking and changing language, mentorship programs for diversity growth, training options for diversity training

  • Within the supply chain, is the spending for diverse suppliers significant compared to non-diverse suppliers?

A few points to consider:

Some companies are empowering communities outside of their supply chains, such as chemical companies assisting farmers to increase crop yields through the supply of their products. A lot of empowerment is happening, but not actually in their supply chain. This should still be written about when there is a significant impact, but it should be written under the topic 'Labour Practices' (please contact a member of the team if you want to capture a significant impact).

Job security, protective equipment, and certifications = do not equal empowerment.
When companies use suppliers, it automatically created employment which does not mean that these workers are being empowered. Protective equipment is a basic standard depending on the nature of the work. And for certifications, you should be critical about these and they should not be the focus of the analysis as there is a lot of 'social-washing'.

Avoid making big claims that are unsubstantiated with quantitative data, having the text mirroring sources.
For instance, claiming that companies are ensuring "job security", "increase economic growth", "financial stability", etc. Should not be included if there is no data to prove this and show how this is being done.
You do not need to make the impact seem bigger than it actually is by making big claims about empowerment and its impacts.
Remain nuanced, unbiased, and factual to just report on the impact data.

If the company only sources locally or only spends a significant amount on diverse suppliers, this can be written about.
It should, however, include a disclaimer that to the best of our knowledge, the company has not reported initiatives on other empowerment methods. This should then be captured in the scale (smaller side).

To find impact data, you can always look for studies on specific communities (without researching the company) to see if there are any constraints faced by these communities or if they have been able to secure their livelihoods, etc.

How do measure the impact of Supply Chain Empowerment?

Example 1: Through training and microloans, Nestlé supports the livelihoods +500k farmers in its supply chain

The issue: "Global supply chains employ ~450 million (M) people11. Farmers are part of society's most vulnerable group, often facing food and wage insecurity and making most of the world's poor and undernourished12. Good supply chain practices provide better-earning prospects, & build better communities13;p6."

Program 1: "The company works directly with 550,000 farmers in its "Farmer Connect Program", providing entrepreneurial training to 400,000 each year, which represents 57% of all Nestlé's supply chain farmers3,6;p26

Impact: …attracting young farmers and reducing food insecurity while improving nutrition6;p25-26.”

Program 2: “Village Savings and Loans Association (VSLA) scheme has helped 6,690 women save & manage their own business…

Impact: ...increasing by 5% their land ownership and involving them in decision making8;p14.

Program 3: “Terrafertil, a controlled entity of Nestle since 2018, collaborates with small farmers in Colombia and Ecuador…

Impact: ...offering them training and stable incomes by guaranteeing crop purchases at fixed prices10;p8,9.

Program 4: “Nestlé also set in place a Milk District Model in developing countries, offering free vet services and technical animal husbandry support as well as $25Mn in microfinance loans to more than 296,000 farmers

Impact: ...ultimately alleviating poverty5.

Example 2: Symrise improves livelihoods of Malagasy vanilla farmers, but might be also creating dependence

The issue: "80% of the world's vanilla is grown in Madagascar1, the 9th poorest country3, where 75%2 out of 28,361,8259 live in poverty. In addition, small-scale vanilla farming is threatened by price fluctuation, creating economic instability for the farmers5,6;p4."

Supply Chain Context: Symrise sources vanilla directly from 7,000 Malagasy farmers in 84 villages1. By working directly with them (see report 20208;p123), Symrise provides them with a long-term guaranteed income5. This brings growth, transparency, traceability, and benefits 34,000 people1.

Partnership 1: “Symrise established partnerships to achieve sustainable vanilla sourcing in Madagascar…

Impact: …For example, its partnership with Kellogg provided resilience and crop diversification training to 1,000 Malagasy vanilla farmers3,7.”

Partnership 2: “Since 2016, Symrise also partners with Save the Children…

Impact: …The partnership provided health insurance to 9,000 households and 38,000 community memebers2. In addition, 40,000 people received essential package training to improve health and nutrition, and 2,400 people got access to education services2.”

Certifications: “Symrises uses certifications (Fairtrade, Rainforest Alliance, Organic)6;p20 to ensure fair treatment of farmers6;p4

Impact: …As a result, it was ranked among the top 10 sustainable companies out of 9,6004. The farmers get most benefits by being given rice advances, premiums paid in advance, and crop diversification programs that all benefit the livelihoods of farmers6;p21. Further, these programs prevent early harvesting (which is positive) due to an immediate need for food money6;p21 and ensure quality.”

It is important to remain critical and nuanced. In your analysis, make sure you add value to your readers and go beyond the company’s CSR report by not merely reporting data from the company’s report but going the extra mile of providing additional metrics, studies, and sources to make your analysis robust and the impact value and scale are clear.

“On the other hand, these programs prevent farmers from selling on an open market and render the farmers dependent on the company6;p28.

Common Mistakes:

  • Make sure the empowerment initiatives take place inside the company’s own supply chain.

  • Go beyond the company’s own reports/websites to avoid green/social washing.

  • Make sure the impact is relevant.

  • When partnerships are discussed, individuate the company’s contribution.

  • We are looking for initiatives that are helping suppliers solve their problems and empowering them, initiatives aimed at making the company’s practices less carbon-intensive, or remediation initiatives that are not relevant.

  • Avoid making big claims that are unsubstantiated with quantitative data.

Make sure to describe the scale of the impact by taking into account:

1/ The breadth of the impact

  • Is the impact local, national, or global?

  • How many people are concerned? Thousands? Hundreds of thousands?

2/ The depth of the impact

  • Is the life of people concerned deeply affected, or does the issue just marginally impact them?

  • Are the changes brought by the issue profoundly changing society or the planet?

3/ The persistence of the impact

  • How long would the impact described last for? Months? Years? Decades?

  • How reversible is the impact described in the impact analysis? Can it be easily stopped/extended?

Helpful Sources

Direct data from the company

  • Annual reports

  • CSR/ESG reports

  • URD (Universal Registration Document)

  • ESG data tables on the Website of the company

  • Official websites

Whenever there are doubts about the meaning of something, we encourage you to thoroughly read the reports of the company, considering footnotes, and methodology frameworks, as those might contain the answer to your doubts.

External sources

  • Using external sources to corroborate the company’s impact is very important for this topic.

If you cannot find a source to corroborate what the company has done for a community, try to research that community to see if any studies or news articles have been published on empowerment. You can, for instance, search on google scholar for the initiative without the name of the company. There are usually studies on this.


1. Check if the assigned analysis has more recent data (we require the latest data available - at least 2021)

NO: do not refresh the analysis and please report it 

YES: Move to step 2

2. Check the intro: Is it up to standard? Are sources working? Is data current and relevant?

YES: do not refresh the introduction

NO: move to step 3

3. Check if the most relevant initiatives are being discussed

YES: stay with the same activities and update the note with the most recent data

NO: move to step 4

4. Find the most relevant initiatives and include their most recent data.

5. Update the number of people reached.

6. Include direct impacts.

7. Fix the conclusion.

8. Update the data points as per the available data.

9. Fix the Headline.

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Step 5: Assess scale and value

Learn how to assess the analysis you are writing or reading.

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