Supply Chains

           While a majority of North American firms in the survey (almost 60 percent) have a documented corporate-level sustainability strategy, just over one-third (36 percent) have adopted a formal sustainability strategy for the supply management organization — a crucial step in ultimately being able to deliver on their sustainability promises.

      Those are among the findings of a study by global management consulting firm A.T. Kearney, in conjunction with the Institute for Supply Management.  The study surveyed firms across a variety of industries to assess corporate sustainability practices and understand how sustainability is impacting businesses. Corporate sustainability is defined as the promotion of economic development (e.g., profits and job creation), environmental stewardship (e.g., energy conservation and pollution reduction), and social well-being (labor standards and community impact).

      The research revealed that most firms have recognized the value of adopting sustainable practices, whether to strengthen their brand or to differentiate products. Companies understand that sustainability management is a top-line issue, rather than just a compliance issue.  Sustainability provides companies with an opportunity to improve their corporate image and differentiate their products.

Economic Update

 The installation of Felipe Calderón as Mexico’s new president provides an occasion for Dallas Federal Reserve Bank economists William C. Gruben and Erwan Quintin, both specialists on the Latin American region, to discuss Mexico’s progress toward economic stability as well as its remaining hurdles to growth.

      Q: Why has the Mexican economy been so stable in the face of recent political turmoil?

      Gruben: The first thing to recall is the protracted period of Mexican history when presidential transitions were accompanied by fiscal misbehavior, which created worries for the investment community. Investors would understandably be highly uncertain about the exchange rate, so Mexico would get boom-and-bust cycles every six years.

      One of the most important developments in the last 50 years is that Ernesto Zedillo, Mexico’s president from 1994 to 2000, didn’t engage in this type of behavior as his sexenio, or six-year term, came to a close. Although Calderón inherits a stable, growing economy, he faces the challenges of an ineffective educational system, a legal structure in need of repair and excessive government interference in the private sector.

      Q: What have been the fruits of this good fiscal behavior?

      Quintin: I like to say that Mexico has been able to grow a yield curve in recent years. The Mexican government was unable to sell any debt with over a year to maturity in the aftermath of the mid-1990s Tequila Crisis, but the situation has changed tremendously in the past five years.