How Cox Enterprises is shaping its sustainable supply chain

Sumit Dutta: Supply chain sustainability has become a top board-level topic but organizations struggle to move forward. How did you start this journey at Cox Enterprises?

Clarence Jackson: Cox was a pioneer when we started in 2007 with energy-saving goals to reduce our internal carbon footprint by 20% in 10 years, and we hit that early. Then we said, “OK, let’s be more comprehensive.” We wanted zero waste to landfill by 2024 and carbon and water neutrality by 2044, but we recently went through a strategic planning process a year and a half ago and accelerated the latter goals to 2034. This aligns with aggressive revenue targets and social goals as well. As part of that, we said, “Let’s look at our supply chain.” Our supply chain had been designed for efficiency — to get the freight moved and supplies on-time.

We had no idea what our impact was, but we thought it was big, because we spend billions on outsourced items, working with 50,000 suppliers. We worked with EY professionals to, first off, do a materiality assessment. We all knew we wanted to be sustainable, but where is the priority for us, our customers, investors and our board?

Then we analyzed our supply chain spend, which needed to be sourced from multiple databases. For about a year, we examined our climate impact within certain spending categories, with EY help, using a comprehensive environmental data set. For instance, in software, for every dollar spent, it has this much carbon, waste and water use. And we knew that some of our suppliers were much better than others on sustainability. Directionally, that spend analysis showed 13 categories and priorities, and we developed strategic processes on how to measure and address the very high-impact categories, such as electronics returns, packaging and transportation.

SD: One of the regular challenges we see in sustainable supply chains is where to focus. Most companies start their sustainability journey in procurement. However, there are also compliance, revenue enhancement and increased shareholder value opportunities. As you went through the journey, how did you prioritize your efforts?

CJ: In 2020, our VP of Corporate Social Responsibility made environmental, social and governance (ESG) a bigger priority. We brought EY professionals back in again to look at our areas of focus and specific metrics, and sustainable supply chain was part of that, including supplier diversity measurements. We hadn’t been auditing our suppliers, and we assumed that, since we were a service business, we had minimal supplier risk. We weren’t monitoring risk from an environmental or sourcing standpoint. So, we came up with a list of things to check off and focus on and based on the prior analysis we knew which categories had the highest impact.

We focused on the short-term wins, and now we’re on to longer-term projects, like sustainability programs around coaxial cable and electronics. In electronics, we had processes in place for reuse and recycling. Next, we put the environmental priority on that and closed the loop: recycling is awesome, but we’d rather keep it in our business and remanufacture it, like TV remote controls. We work with non-profits to do that work, so there’s a social aspect as well.

SD: How do you make sustainable supply chains real and demonstrate progress— do you focus on procurement, logistics or product design? Or do you just try to measure where you are and get better from an operations perspective?

CJ: Well, it’s all of it. We took our categories data and integrated it into tools that our sourcing managers now use. A lot of them asked: “Why do you want me to ask about sustainability for software? There’s no impact there.” But now they have dashboards that show them the impact, because of travel and those types of things — they can see the directional environmental impact in carbon, water and waste.

We’re training our stakeholders, starting with business leaders, and the folks within our company who are engineering, for example, a new cable box or a new process, so that sourcing isn’t the only department trying to fight for sustainability. The owners of the processes in the business are now asking how to be part of sustainability. They know that we’ll be putting these requirements in requests for proposals and contracts about reporting, such as for sustainable packaging.

SD: Supply chain sustainability is not a linear journey. Tell me about the things that you tried and didn’t work, or that you struggled with.

CJ: Sustainability is a mindset shift for some of our subcontractors. Their business models are piece rate or by package, for example. Their job is to service something for us, but we also must train them in sustainability even if they lack goals of their own.

In the analysis, we found that we devoted millions of our spending to one particular company. I thought: “This is easy. Send them a survey; we’ll find out what they’re doing.” They refused. The pivot on that was training. We went to them and said, “Let’s have lunch. It’s not your priority now, but we’re a large company, and we have these goals, and let’s talk about what you can do.” When we dug in, we found that they were doing some things already. We also work with some trade groups — not new groups but partnering with those who know their businesses and their space and fitting sustainability into the agenda.

Half my job is business and operations sustainability out in the field, and the biggest part of that is change management. My goal is not to build a team that’s just going to create and manage sustainable supply chains. I want to empower the customers in our organization and our sourcing teams and suppliers that want to come on the journey with us — to train them on sustainability while also being economical, efficient and attentive to quality. We must figure out where they are and come to them in the way they want to be approached. My main goal is getting our customers and organizational leaders to be co-champions with us — that we are all in this supply chain sustainability journey together.