Download this article in PDF format.

Knowing what your suppliers are doing is a constant struggle for organizations that not only need to monitor what’s going on within their own four walls, but also out across the broader supply chain. This has never been easy, but technology does give companies more connectivity, power and oversight over something that can quickly turn into a mysterious “black box” of the supply chain.

The supplier oversight challenge is particularly thorny once you get into the Tier 2 and Tier 3 levels, where smaller suppliers and vendors that don’t deal directly with the buying organization often operate with much more autonomy. One supplier that misreports its emissions or one vendor that overlooks a labor violation can throw a customer’s entire sustainability program into disarray.

And while it’s always been known that visibility beyond Tier 1 is elusive, findings from the new EcoVadis Sustainability Ratings Index highlight a starker reality: 80% of Tier 1 suppliers have no documented process for identifying or managing sustainability risks within their own supply chains. Seventy-three percent don’t report upstream Scope 3 emissions, while 77% don’t track downstream emissions.

“Organizations have built sophisticated tools to analyze supplier sustainability data, [but] the suppliers either don’t have that data or can’t report it in a form the tools can use,” said Sylvain Guyoton of EcoVadis, in a press release. “Better software does not close that gap. The measurement problem lives in the supply base itself, and closing it requires sustained engagement over time: structured assessment, scored performance, and documented follow-through.”

Sustainability Programs Need Some Work

U.S. companies may not be talking as much about environmental, social and governance (ESG) programs right now, but that doesn’t mean they’ve taken their foot off the sustainability gas pedal. In many cases, they’re just using different language and folding those priorities into procurement, compliance, emissions reporting, supplier management and risk programs.

The problem is that those programs often don’t extend far enough into the supply chain. According to EcoVadis:

• Four out of five suppliers aren’t managing sustainability risks deeper in the chain. Most suppliers (80%) have no documented process for identifying or addressing those risks within their own supplier networks.
  
  
• Scope 3 reporting remains sparse. Seventy-three percent of EcoVadis-rated companies don’t report upstream emissions and 77% don’t track downstream emissions.
  
  
• Most workers have no outside channel for reporting violations. Just 2% of suppliers assessed by EcoVadis have an external grievance mechanism that workers can use to report human rights concerns.
  
  
• Buyers still aren’t getting detailed supplier data. Less than 1% of companies assessed by EcoVadis provide granular sustainability information that customers can use to make purchasing and supplier-management decisions.
  
  
• Environmental performance is improving inside company operations. Forty-six percent of rated suppliers purchase or generate renewable energy and 38% provide climate training for employees.
  
  
• Most suppliers still lack science-based carbon targets. Despite the improvement in environmental scores, 78% haven’t established science-based emissions reduction goals.
• Supplier verification still relies heavily on paperwork. Forty-two percent of companies use unverified supplier questionnaires, while just 20% conduct onsite audits. That audit rate has barely changed in the last four years.
• Artificial intelligence is running into the same data problem. Sixty-eight percent of corporate buyers have deployed AI in sustainable procurement programs, but 30% of suppliers provide no carbon data and 26% provide only aggregated estimates.

EcoVadis says companies can start closing these gaps by setting specific supplier expectations, collecting better emissions and labor data and following up when problems arise. The company also recommends using audits, corrective-action plans and regular supplier reviews instead of relying mainly on self-reported information.

On a Positive Note…

Some companies and institutions are making measurable strides on the sustainability front this year. According to the Global Electronics Council (GEC), the winners of the 2026 EPEAT Purchaser Awards collectively bought more than 1.5 million EPEAT-registered products, cutting an estimated 224,000 metric tons of greenhouse gas emissions. Those purchases also reduced energy use by 978 gigawatt-hours, conserved 2.25 billion liters of water and kept 20,400 metric tons of solid waste out of the waste stream.