This blog aims to define AI’s role in environmental risk management, addressing challenges, and explaining how Unchained services align with new regulatory needs.
Environmental risk management in supply chains is becoming increasingly important as companies face pressures to reduce carbon footprints and implement sustainable practices. This shift prompts essential questions: How dependent is your company on natural resources? What emerging regulatory frameworks will impact your operations?
AI is emerging as a powerful tool to help manage these risks by providing more accurate insights, predictive capabilities, and real-time monitoring across the supply chain, AI can help companies proactively address inefficiencies. From optimizing logistics to reduce excessive energy use, waste generation, or resource overconsumption or deforestation linked to supply chain activities, AI’s capabilities extend across countless applications.
However, the use of this technology can also present challenges in terms of balancing social good with environmental risks. Interpretation errors and algorithmic biases are common and need to be thoughtfully considered in the sustainability domain. In the fields of agriculture, environment, and sustainability, misinterpretations and biases within AI algorithms can create unintended consequences, such as risks to food security or ecosystem stability if data are misrepresented. Privacy and ethical concerns also arise, as data collection becomes more pervasive, demanding careful handling of information on both systems and individuals to avoid decisions based on misleading patterns or correlations.
This discussion is far from over and continues to spread globally.
The EU’s AI Regulation: Setting a Global Standard
That AI-driven platforms are revolutionizing global supply chain transparency we already know, but how will the new AI regulations affect companies worldwide? This question is particularly relevant with the European Union’s (EU) pioneering AI Act. Adopted by the EU Parliament in March 2024 and approved by the Council in May, the AI Act has strong action on environmental issues, supporting green transition, and further climate neutrality by 2050 and aims to increase transparency while aligning with the EU’s broader digital transformation goals.
AND HOW CAN UNCHAINED HELP YOUR BUSINESS?
Unchained provides facilitation and advisory services to support your due diligence and supply chain management process, from data gathering to strategic planning and triage. Partnering with industry leaders, we integrate AI into your due diligence framework to enhance operational efficiency and ensure compliance, all while driving a positive societal impact. Contact us today to see how Unchained can guide your path toward sustainable supply chain management.
