What is Risk Assessment in Supply Chain?
Risk Assessment in Supply Chain is the process of identifying, analysing, and managing the potential risks and vulnerabilities within a supply chain that could disrupt operations, impact profitability, or harm the reputation of the business.
For supply chain traceability companies, this involves examining various elements of the supply chain, from sourcing raw materials to delivering finished products, to identify potential risks such as supplier failure, regulatory non-compliance, environmental impact, and ethical issues like labour practices and illegal logging.
A thorough risk assessment enables companies to develop strategies to mitigate these risks, ensuring the resilience and sustainability of their supply chains. This can include diversifying suppliers, enhancing transparency and traceability measures, and implementing stricter compliance and sustainability criteria for suppliers. By proactively managing supply chain risks, companies can protect themselves against disruptions, align with global sustainability standards, and meet the expectations of consumers and stakeholders for responsible business practices.
Related terms
Proof of Authority
Proof of Authority (PoA) is a consensus mechanism used in secure digital ledger networks where transactions and block creation are validated by approved accounts, known as validators.
Risk Assessment in Supply Chain
Risk Assessment in Supply Chain is the process of identifying, analysing, and managing the potential risks and vulnerabilities within a supply chain that could disrupt operations, impact profitability, or harm the reputation of the business.
Sustainability
Sustainability in the context of supply chain management refers to the development and implementation of environmentally responsible and socially equitable business practices throughout the supply chain. It aims at meeting the needs of the present without compromising the ability of future generations to meet their own needs.