Applicability of supply shed approach in global supply chains: integrating supply shed and landscape approaches for natural capital assessment

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Authors: Keishi NAKAO, Ryo Kohsaka
Cited by: 2
References: 13

Abstract

Abstract Private companies are increasingly expected to evaluate and disclose their environmental impacts across entire value chains, yet supplier-level traceability remains highly burdensome. Core barriers include supplier volatility, commodity mixing, and nondisclosure by upstream actors. These challenges limit the feasibility of site-specific monitoring and hinder compliance with emerging frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD), the European Union Deforestation Regulation (EUDR), and the Kunming–Montreal Global Biodiversity Framework adopted under the Convention on Biological Diversity (CBD). In response, the “supply-shed” approach has emerged as a pragmatic alternative. By grouping suppliers within defined markets or regions, it enables collective impact assessment and management without requiring precise supplier identification. This method, already applied in corporate Scope 3 greenhouse gas accounting, reduces costs while maintaining meaningful links to environmental outcomes. Integrating the supply-shed concept with landscape approaches provides a hybrid framework that balances practicality and ecological relevance. The supply-shed brings organizational clarity and accountability within supply chains, while the landscape approach anchors assessments in spatial and ecosystem-specific boundaries. Together, they allow companies to conduct initial risk screening at regional scales using secondary data, remote sensing, or environmental DNA (eDNA), followed by targeted supplier-level studies when higher resolution is necessary. This model offers efficiency in addressing traceability barriers and supports more systematic monitoring of biodiversity, water, and land-use impacts. Looking ahead, critical issues remain in defining responsibility across overlapping supply-sheds, ensuring coordination within broader landscapes, and aligning with regulatory regimes that may burden smallholders. Nonetheless, embedding supply-shed–landscape hybrids into evolving policy frameworks presents a cost-effective and inclusive pathway for corporate natural capital assessment. Such integration can lower financial and technical barriers, expand corporate participation, and foster more credible contributions to global biodiversity conservation.

Fields of Study & Subjects

Food Supply Chain Traceability Sustainable Supply Chain Management Global trade sustainability and social impact

Publication details

Journal / source
Environmental Research Communications
Publisher
IOP Publishing
Volume
8
Issue
2
Pages
022501–022501
Publication date
26 January 2026
Language
EN