MIT Sloan Management Review Article on How Supply Chain Transparency Boosts Business Value

In November 2020, executives from Amazon, Ikea, Nike, and other high-profile companies were called before the U.K. Parliament to address claims that their suppliers might be using forced labor.1 Members of the House of Commons’ Business, Energy and Industrial Strategy Committee were investigating the potential exploitation of Uyghur Muslims from the Xinjiang region of China.2 They directly challenged company representatives on how their organizations maintain visibility into and combat modern slavery within their supply chains.

With businesses’ sourcing practices under such scrutiny, supply chain transparency has become an imperative in many industries. Emerging regulations such as the U.K. Modern Slavery Act and the California Transparency in Supply Chains Act are not the only drivers of this trend, however. In industries such as apparel, consumer electronics, and food and beverage, companies are facing pressures from all sides to demonstrate better environmental and social practices in their supply chains.

About the Author

Tim Kraft is an associate professor of operations and supply chain management and the associate research director of the Supply Chain Resource Cooperative at the Poole College of Management, North Carolina State University.

Yanchong Zheng is the George M. Bunker Professor and an associate professor of operations management at the MIT Sloan School of Management.

Learn more about MIT SMR.