Space Technology and Supply Chain Sustainability: Satellite-Based Due Diligence and the EU Deforestation Regulation

Today’s global supply chains are complex, dynamic and often opaque, with companies struggling to trace back where their material is coming from beyond their direct suppliers and the numerous intermediaries along the chain. Simultaneously, sustainability issues such as deforestation (and the resulting carbon storage and biodiversity loss) but also human rights violations and forced labor tend to be most frequent and devastating deep upstream in the supply chain, effectively hidden from sight. As certification schemes and audits have come under increased scrutiny, companies in forest-risk commodity supply chains (e.g., for palm oil, cocoa, coffee and timber) are now increasingly looking to satellite-based monitoring to gain transparency and continuous oversight over deforestation risk at the raw material source. While this line of application is relatively new, it is gaining momentum as the upcoming EU Deforestation Regulation essentially mandates remote monitoring and new technology providers are entering the market. This chapter explores the current landscape of satellite-based monitoring in supply chain sustainability management, how companies develop the capabilities and collaborations to effectively use satellite data, which challenges and unintended side effects emerge as well as where the opportunities and pitfalls lie when looking ahead, in terms of lasting sustainability impact on the ground, collaboration across the supply chain as well as interoperability and information security questions.