An estimated 80 per cent of global trade passes through supply chains – networks of customers and suppliers that contribute to delivering an end product or service to market.

In many industries, it is a company’s supply chain – rather than the company itself – that is responsible for the majority of greenhouse gas emissions and therefore offers the greatest potential for environmental improvements. By setting high procurement standards, buyer firms can help drive sustainable practices in supplier businesses.

We want to operate in a world where global supply chains support sustainable economic growth by offering opportunities for decent work and minimising negative environmental impacts.

What HSBC is doing

At HSBC, our aim is to support the sustainable development of our clients’ supply chains, and foster new business development and the sustainable, international growth of small and medium-sized enterprises and entrepreneurs.

To achieve this, we are forming partnerships with customers, NGOs and other key stakeholders to transform supply chains towards sustainability. We will also ensure our community investment programmes support sustainability in sectors including clothing and palm oil.

HSBC has made four commitments to supporting greater sustainability and responsible business practices in companies’ supply chains:

  • Introducing supply chain solutions that embed sustainability. We will seek commercially viable propositions that support environmental and, where possible, ethical improvements in our clients’ supply chains

  • Supporting garment factories, tanneries and mills in China, India, Vietnam and Bangladesh to shift towards sustainability. We will do this in partnership with charities including WWF, WaterAid and the Apparel Impact Institute (see case study)

  • Supporting the Roundtable on Sustainable Palm Oil and partnering with NGOs, industry bodies and customers to increase demand for certified, sustainable palm oil. Led by HSBC teams in Asia, we will increase our support for research and collaboration to remove barriers to flows of certified sustainable palm oil and provide practical support to demonstrate what’s possible in the shift to sustainability in the sector, in line with our no deforestation, peat or exploitation commitment

  • Expanding our review of the ethical risk posed by our suppliers. All our suppliers of high-risk products and services, and those operating in high-risk locations, will be required to complete self-assessments of their policies and performances by 2020

We already have a policy which sets standards for customers involved in the manufacture of palm oil, which was last updated in February 2017. You can read a progress report on the implementation of this policy in our November 2017 ESG Supplement (20-page PDF 580KB).

Improving sustainability in the leather industry

In 2018 HSBC joined the Ganges Leather Buyers Platform – an initiative launched by the charity WWF to reduce the environmental impact of the leather tanning industry along India’s Ganges river. 

The Platform brings together leading clothing and footwear brands that buy leather from the region. Members work to understand the environmental impact of their supply chains, reduce water pollution by encouraging their suppliers to take part in local WWF initiatives, and raise awareness of the issues. HSBC has joined in order to share its knowledge of trade finance and support sustainable improvements in India-Europe clothing supply chains.

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Measuring our impact

We publish regularly updated information on our performance in relation to environmental, social and governance issues.