Reducing Volatility in the Supply Chain

We've seen the COVID-19 pandemic and climate-related events cause massive disruptions in global supply chains, with harmful impacts on the economy and society. As more companies focus on climate change, there's a great need—and opportunity—to examine equity as a key driver of resilience in supply chains.”
Jamesine Rogers Gibson Climate Consultant and member of the Women+ in Climate Tech TECFD team

Women play a critical role in supply chains worldwide. For example, women represent:

  • Over three-quarters of garment sector workers (90% in Cambodia, 85% in Bangladesh, 70% in China and 63% in Jordan).
  • 75-80% of workers in floriculture, and an estimated 45% in horticulture.
  • 50% of the workforce in mobile phone production.
  • 70% of the global tourism workforce.

Large businesses reliant upon female labor are likely not adequately and fully capturing their climate-related risks through the TCFD recommended scenario planning. This is because they are not accounting for the increased risks facing women as a population; gendered climate scenario analysis does not yet exist as of the writing of this report, a fact that WiCT+ is working to change.

The increased climate-related risks facing women can be explained in part by occupational segregation seen in many of the industries mentioned above. Women are primarily low-skilled laborers at the bottom of global supply chains, and gender discrimination often prevents their access to higher-paying jobs and upward mobility that would increase their earnings, resilience, and more.

Further, women-owned businesses lack access to capital, insurance, and other products for de-risking and building resilience. Reducing gender inequities in financial products for agriculture, for example, could increase yields on women’s farms by 20-30 percent, according to GenderSmart. Root Capital’s Women in Agriculture Initiative is designed to improve the climate resilience of women in agroforestry collectives in Central America. The program considers gender-based vulnerabilities by providing loans, grants, and training.

More research is needed to uncover and quantify the positive impacts that women-owned businesses have on building resilience and promoting adaptation—both across the corporate supply chain and within community settings. However, we know that overall, only one in five export-oriented businesses are owned by women despite the fact that more than 30 percent of micro, small, and medium-sized enterprises (MSMEs) worldwide are owned by women (Infosys BPM). Put another way, corporations spend trillions of dollars acquiring goods and services but purchases from women-owned businesses account for only 1 percent of the total spend (UN Women, 2017).

Navigating Volatility

5. Action Steps

©2022 Aon plc. All rights reserved | Contact Us | Privacy Policy | Legal