Adopting a data-driven mindset and transforming your responsible sourcing

Traditional auditing methods, while necessary to monitor supplier risks, are no longer sufficient to meet evolving regulatory demands and increasing expectations for organisations to improve their supply chain risk management. Businesses are being asked to optimise supplier transparency, mitigate and remediate environmental, social and governance risks, all while being able to predict and prevent future potential ESG risks. Once-a-year supplier checks will no longer meet the mark.

Companies must go a step further and adopt the data-driven mindset and implement further due diligence measures in their supply chains. This is where LRQA's supply chain intelligence software, EiQ, comes in, revolutionising how companies manage their responsible sourcing risks.

Beyond audits: The power of data-driven decision making

Audits have long been the cornerstone of supply chain risk management. However, they often provide only a snapshot in time, leaving businesses vulnerable to emerging risks that can occur between audit cycles.

EiQ transforms this approach by supporting businesses in near real-time monitoring of their supply chains. By leveraging a wealth of data sources, including more than 25,000 audits per year and trusted civil society research, combined with monthly scans of supplier incidents detected in media channels, EiQ offers granular insights and comprehensive risk analysis which enable companies to proactively identify and mitigate risks before they escalate into major issues.

Example of EiQ dashboard overview

Scanning suppliers for adverse media

A key feature of EiQ is Sentinel, an advanced tool that scans suppliers for adverse media instances. A single negative news report can significantly impact a company's reputation and financial standing, especially as media reports are increasingly surrounding forced labour and child labour investigations in global supply chains. Sentinel continuously monitors global news sources and flags any adverse media mentions related to suppliers, covering more than 250,000 entities each month. This proactive approach enables companies to respond swiftly to potential issues, maintaining the integrity of their supply chains and safeguarding their brand reputation.

Receive a free trial scan of your suppliers with Sentinel.

Proactive management of responsible sourcing risks

With EiQ, companies can transition from reactive to proactive risk management. The platform's robust analytics and reporting capabilities provide a holistic view of the supply chain, highlighting areas of potential risk and offering actionable insights for improvement. This proactive stance not only helps in mitigating immediate risks but also in building a more resilient and sustainable supply chain in the long run.

EiQ further enhances risk management by providing detailed risk scores for sourcing regions, products, and individual suppliers. These scores offer invaluable insight into the level of risk exposure associated with each element of the supply chain. Derived from from-the-ground data and supplemented with trusted public domain data, these scores enable businesses to make informed decisions and prioritise areas that require immediate attention. By understanding the specific risk factors associated with their supply chain, companies can better allocate resources and implement targeted strategies to mitigate potential issues.

Meeting and exceeding regulatory requirements

The increasing regulatory scrutiny of supply chain practices requires companies to maintain sourcing integrity and demonstrate compliance with various standards. Regulatory frameworks like the EU’s Corporate Sustainability Reporting Directive (CSRD), Germany’s Supply Chain Due Diligence Act, and forced labour regulations in regions like the EU, US, and Canada demand stringent compliance and transparency.

EiQ simplifies the due diligence process by providing a centralised platform to monitor and manage audit and risk data from both an individual supply chain level as well as a global perspective. The platform’s comprehensive reporting tools ensure that companies can easily compile and present the necessary documentation to regulatory bodies, avoiding penalties and enhancing their compliance posture.

EiQ is a strategic tool that empowers businesses to meet the challenges of modern responsible sourcing. By integrating data-driven decision making and leveraging tools like Sentinel, EiQ enables companies to proactively manage their ESG risks and stay ahead of regulatory requirements. For businesses looking to build resilient, ethical, and compliant supply chains, EiQ offers the innovation and support needed to thrive in today’s complex global market.

Contact us to learn more about how you can use EiQ to enhance your responsible sourcing approach.