EcoVadis has warned that sustainability performance inside many companies is improving faster than their ability to see what is happening further down the supply chain, with a new index showing that most tier-1 suppliers still lack basic systems for monitoring risks beyond their immediate operations.
The business sustainability ratings group said 80% of rated companies have no documented process for identifying or managing sustainability risks deeper in their supply chains. Its...
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Sustainability Ratings Index, published on 1 July and based on almost 200,000 scorecards covering more than 100,000 companies rated globally between 2021 and 2025, also found that 73% do not report upstream Scope 3 emissions and 77% have no downstream tracking. Only 2% have an external grievance channel that workers further down the chain can realistically use to report human rights abuses.
According to the authors of the report, companies are making visible gains on climate and labour issues within their own walls, but that progress fades as scrutiny moves beyond direct operations. EcoVadis said the data points to a transparency problem in which suppliers are often unable, or unwilling, to provide decision-grade information to customers, leaving buyer organisations with incomplete visibility.
That gap matters because many firms are now using more sophisticated digital tools to manage procurement and sustainability. In its companion Barometer 2026 report, EcoVadis said 68% of corporate buyers have adopted artificial intelligence tools in sustainable procurement programmes, with carbon data validation cited as a leading use case. Yet the supplier base is not keeping pace: 30% of suppliers provide no carbon data at all, while 26% submit only aggregated estimates.
Sylvain Guyoton, EcoVadis’s chief rating officer, said the core obstacle is not the software on the buyer side but the quality and structure of the underlying data. He argued that better systems alone cannot solve a measurement problem rooted in suppliers’ own reporting practices, and said improvement depends on sustained engagement, structured assessment and documented follow-through.
The report also suggests that compliance remains heavily document-driven. Forty-two per cent of companies still rely on unverified supplier questionnaires, while just 46% require suppliers to sign a sustainability code of conduct. Only 20% carry out on-site audits, a figure that EcoVadis said has barely changed in four years.
At the same time, the company said many rated businesses are strengthening internal policies. Environmental scores recorded the largest four-year improvement across the themes measured, rising by 9.6 points on average. The share of companies reaching Advanced+ status, defined as a score of 65 or above on EcoVadis’s 0-100 scale, climbed from 17% in 2021 to 38% in 2025. Labour and human rights remained the strongest category globally, with an average score of 59.5, while 80% of rated firms had formal diversity, equity and inclusion policies and 78% had health and safety policies in place.
EcoVadis, which positions sustainability ratings as a tool for procurement, investors and regulators, said the findings underline a widening divide between corporate ambition and supply chain verification. Its broader assessment is that sustainability reporting is becoming more common, but genuinely traceable oversight of suppliers further upstream remains limited.
Source: Noah Wire Services
