How CPG And Retail Firms Can Navigate Sustainability Hurdles With Digital Solutions

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How CPG And Retail Firms Can Navigate Sustainability Hurdles With Digital Solutions

Consumer packaged goods (CPG) and retail firms are constantly facing public scrutiny over their ESG and sustainability-related commitments. Just last month, Unilever – often viewed as a leader in terms of its sustainability initiatives – announced an ‘evolved sustainability agenda’, scaling down several of its environmentally-friendly and socially-conscious initiatives. In March 2024, Unilever, Procter & Gamble, Walmart and other major firms had their Science Based Targets Initiative (SBTi) targets removed for being unable to meet their net zero commitments. With revenues totalling nearly $240 billion and over 2.3 million employees, these three firms’ actions can significantly drive change.

Unilever’s struggles reflect the many challenges that other firms in this industry face, such as demonstrating progress towards sustainability commitments, managing complex supply chains and staying knowledgeable about shifting consumer preferences. These challenges are causing CPG and retail organizations to rethink their existing practices and implement digital strategies and systems to improve their sustainability plans. Verdantix finds that firms looking to improve their sustainability contributions in these industries should:

  • Establish internal processes to set the foundation for a successful sustainability programme.
    Firms need to establish a dedicated cross-functional team to develop their sustainability digital strategy and navigate the multi-faceted components of their ESG programmes. These teams must ensure proper controls and governance practices are in place to ensure both sustainability and assurance requirements are met. Additionally, CPG and retail firms should educate their entire workforces about sustainability initiatives to ensure that each employee can appreciate how their actions contribute to firm-wide goals.

  • Collaborate with external stakeholders.
    Retail and CPG firms must look outside of their organizations to address sustainability challenges, as much of their environmental and social impact stems from factors beyond their direct control. Firms in these sectors should collaborate with external stakeholders – including suppliers, franchisees, partners, industry groups and even their peers – to find ways to further incorporate sustainability into their operations and drive sustainability initiatives.

  • Establish the technical foundation to implement sustainability-related software.
    Investing in software to manage ESG and sustainability is crucial to drive performance improvements, meet regulatory requirements and align with stakeholder demands. Firms should first evaluate their existing IT systems and infrastructure to see how legacy systems can contribute to their ESG information architecture. They can then develop a digital strategy for future investments in technology that aligns with the organization’s goals and values.

  • Evaluate what digital solutions can help address their most pressing sustainability needs.
    Verdantix research reveals that there is no single software platform that can handle all of a CPG or retail firm’s sustainability challenges, with many businesses relying on a combination of software and services to support their sustainability goals. Categories of software that may help firms meet these goals include software for carbon management, ESG reporting and data management, traceability solutions, supply chain sustainability software, and sentiment monitoring technologies.


For additional insights on how CPG and retail firms can address their sustainability challenges, see Verdantix Best Practices: ESG & Sustainability Digital Strategies For CPG & Retail or watch our recent webinar.

Jessica Pransky

Principal Analyst

Jessica is a Principal Analyst in the Verdantix ESG & Sustainability practice, which she joined in 2022. Her current research agenda covers ESG reporting and data management software, ESG solutions for investors, and risk in ESG and sustainability. Prior to joining Verdantix, Jessica worked at Ramboll, focusing on ESG risk and opportunity identification for mergers and acquisitions, as well as EHS due diligence. Jessica has previously held roles evaluating water resource allocation for a state municipality and ensuring EHS compliance for GE Aviation. She holds a BS from Tufts University and an MEng from Johns Hopkins University focused on environmental engineering, as well as an MBA from Boston University.