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The Hinrich Foundation, in partnership with Konrad Adenauer Foundation organised an international workshop on Sustainability in Global Value Chains (GVCs) at the Harbour Grand Hotel Kowloon, Hong Kong, on November 14, 2018. The workshop explored existing company initiatives for enhancing the sustainability of GVCs and trade, and also looked at ways of building industry coordination and better standards for more sustainable and resilient supply chains. The event commenced with the opening remarks from Hinrich Foundation CEO Kathryn Dioth, who explained the importance of global value chain’s in international trade. “Global value chains can create opportunities for emerging economies to participate in global trade, with positive impacts on local growth and development,“ she said.

The global value chain includes all the activities and people involved in the production of goods and services, and supply chain activities such as distribution and post sales activities.

These GVCs also create negative externalities, particularly on the environment and on social equity. If these are not adequately managed they can lead to environmental, climate and social stability-related risks for a country, and to material risks for the companies involved, Dioth noted before calling the Director of KAS RECAP, Hong Kong, Peter Hefele to make his introductory remarks.

Following the commencement speech, Hinrich Foundation Research Fellow Stephen Olson introduced the Hinrich Foundation 2018 Sustainable Trade Index (STI). The index measures the sustainability of trade policies of 19 economies in Asia plus the USA. The Hinrich Foundation commissioned the Economist Intelligence Unit to construct the index.

Olson presented the key findings from 2018 STI at the conference. He pointed out that the index highlighted a broad regression in sustainability across Asia, in particular among the wealthier economies.

He highlighted that the economies in the region showed improvement in the economic pillar of the index, however, they were offset by backsliding in the social and environmental pillar.

Olson also shared key takeaways from the global value chains that emerged out from the index. According to the Research Fellow, sustainability drives competitiveness and companies are taking more leadership role for sustainability especially those multinationals with extended supply chains.

“Companies are instituting codes of conducts and audit procedures into their supply chains. Those companies that perform well in the audits, they are getting more orders,” said Olson as he paved the way for the three-session panel discussion.

The panel in the first session looked into the experiences and challenges faced by companies in greening their supply chain. It was chaired by Eileen Gallagher, Manager of BSR Hong Kong. The panellists included:

  • Andreas Meier, Vice President Corporate Affairs, BASF Asia Pacific
  • Amie Shuttleworth, Global Director of Sustainability, Cundall
  • Joerg S. Hofstetter, President, International Forum on Sustainable Value Chains (ISVC), St. Gallen
  • Björn Wahlstrom, Partner and Director of Operations, Current Consulting, Hong Kong

The second session discussed about sustainability as a driver for future growth, which was moderated by Berenice Voets, Director of Marketing and Communications of Hinrich Foundation. The panellist in the session included:

  • Derek Wu, Analyst, GlobeScan
  • Allisa Lau, Regional Manager, China Supply Chain and Consumer Marketing, Cotton Council International
  • Yam Ki Chan, Head of Public Policy, Google

The third session talked about Creating an effective international regulatory framework for sustainable supply chains, presided over by Robert Agnew, Chairman of European Chamber of Commerce, Hong Kong. The panellist included:

  • Joyce Chau, Asia Pacific Regional Director, Amfori, Hong Kong
  • Karen Ho, Head of Corporate and Community Sustainability, WWF Hong Kong Climate Programme, WWF
  • Nadira Lamrad, Assistant Director, Sustainability and ESG Advisory, Business Environmental Council, Hong Kong
  • Andrew Schroth, Board member, Garment, Apparel, Footwear and Textile Initiative (GAFTI)

The workshop concluded with remark from Hubertus Bardt, Managing Director of German Economic Institute, Cologne, who expressed gratitude to the organisers and panellist for putting up a comprehensive dialogue on the need of promoting sustainability in global value chains and trade.

For more information about the 2018 Hinrich Foundation Sustainable Trade Index, click here.

For more information about the event and its agenda,please click here 

About the author- Pragya Bhatnagar

Pragya Bhatnagar is a Research Associate with the Hinrich Foundation where he focuses on International Trade Research. He is a Hinrich Foundation Global Trade Leader Scholar alumnus, earning his Master’s degree in International Journalism, specializing in Business and Financial Journalism, from Hong Kong Baptist University. He received his bachelor’s degree in Economics from Lucknow University, India.