ESG in the supply chain: 19+1 to-dos

For procurement and supply chain managers, regulations such as the LkSG, CSDDD, CSRD, EUDR, and CBAM mean more documentation requirements, higher transparency demands, and increasing pressure on suppliers.

Despite all these challenges, ESG compliance in the supply chain is an opportunity to identify risks early, reduce costs, and strengthen your own market position. With the right strategy, sustainability can shift from a cost center to a profit center.

But where should you start? This practical checklist with 19 actionable to-dos and one bonus tip provides clarity.

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Review and prioritize ESG regulations

1. Assess which ESG regulations may affect your supply chain

2. Review which regulations apply to your company and when – some regulations (e.g., CSRD, CSDDD, and EUDR) are implemented in phases

3. For most companies, CSRD, LkSG/CSDDD, CBAM, and EUDR are currently the most relevant

Read more:

• LkSG and CSDDD: The most important changes
• Questions and answers on the EUDR
• Fit for CBAM: background, key data and requirements
• CSRD and the supply chain: These disclosures are requested by procurement

Collect ESG data in the supply chain and increase transparency

4. Obtain up-to-date supplier master data and define points of contact

5. Use standardized ESG questionnaires for suppliers and verify them through targeted audits

6. Capture Scope 3 emissions and identify hotspots

7. Define climate targets for the supply chain and implement a climate strategy

Read more:

• Decarbonizing the supply chain

Identify and manage ESG risks

8. Review suppliers for human rights, environmental, and climate-related risks (abstract, concrete, and event-driven risk analysis)

9. Establish measures for risk prevention and implement remedial actions

10. Establish a holistic, future-proof management system for supply chain risks

Strengthen supplier management for long-term ESG compliance

11. Embed ESG criteria in supplier contracts and communicate a Code of Conduct

12. Assess the ESG maturity level of suppliers

13. Provide training and support for suppliers to improve ESG standards

14. Regularly review supplier ESG performance

Review IT systems and optimize data management

15. Review the interoperability of your IT systems

16. Implement digital ESG data management to ensure full transparency and communication with suppliers

Check off ESG reporting and ensure compliance

17. Consolidate data and standardize reporting processes

18. Ensure regular reporting and leverage synergies: Some BAFA requirements (LkSG) overlap with the ESRS (CSRD), EUDR, and CBAM data and can be reused for CSRD reporting

19. Involve external auditors (e.g., certified public accountants) at an early stage

Bonus tip: How to achieve ESG compliance in the supply chain with less effort

Admittedly, ESG requirements for supply chain managers are demanding. However, with the right strategy, they can be addressed efficiently. Use this checklist as a starting point to make your supply chain ESG-compliant. A more detailed breakdown is available in our practical guide to sustainable supply chains.

Our bonus tip: The VERSO Supply Chain Hub creates transparency and supports you efficiently in implementing the LkSG, CSRD, CBAM, and EUDR – automated and legally compliant.