As the regulatory landscape evolves, compliance becomes a significant challenge for Food and Beverage enterprises. The introduction of new regulations, such as the European Union Deforestation Regulation (EUDR) and Corporate Sustainability Reporting Directive (CSRD), is ushering in a wave of change that will require food & beverage companies to forge deeper connections with their supply chains.

Facing the Evolving Landscape is a Challenge

For many food and beverage enterprises, navigating compliance with new regulations can feel like a challenging endeavor, often prompting a realization of the evolving landscape. In some cases, there may be a recognition that the level of supply chain engagement required is more substantial than initially anticipated. This observation is particularly noteworthy for companies with extensive and globalized supply chains, where ensuring visibility and transparency may present unique challenges.

Companies may encounter challenges in maintaining a seamless connection within their extensive network of suppliers. The potential lack of connectivity could imply a shortage of the requisite expertise, resources, or established processes needed for a prompt adaptation and compliance with new regulations.

In addition, due to the novelty of these regulations, the specific requirements are still unfolding. Companies may find themselves in a position where the details and tactics for compliance are not yet fully understood. As these new regulations are being implemented, businesses will need to invest resources in gaining a comprehensive understanding of their intended scope and implications for supply chain operations.

The Complexity of Building Compliance Operations

Building compliance operations is a comprehensive process that demands detailed planning and execution. From developing internal policies and communicating expectations to suppliers, to establishing reporting protocols and implementing workflows, the process can easily span half a year or longer. Contrary to common misconceptions, compliance is not necessarily a task that can be immediately delegated to suppliers. It requires a holistic approach that involves all stakeholders in the supply chain.

Establishing compliance operations involves a multifaceted approach, including policy development, communication strategies, and workflow implementation. This complexity makes the process time-consuming and challenging to expedite.

Compliance extends beyond internal operations to collaboration with suppliers. Companies must work closely with their supply chain partners to ensure a seamless and transparent compliance process.

The Looming 11th-Hour Challenges

For Food & Beverage companies that have not yet embarked on the journey of planning for EUDR and CSRD compliance, the clock is ticking. With a lot of work awaiting them at the 11th hour, these companies must urgently initiate strategic planning to navigate the complex realm of regulatory requirements.