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EcoVadis Study: 72% of US Executives Say Tariffs & Trade Wars Are Top Supply Chain Risk to Business

via Business Wire

More than Half of Respondents Say Tariffs Will Force Their Companies to Compromise on Sustainability & ESG Priorities

Tariffs and trade wars are the most significant external supply chain risk to business, according to 72% of US executives surveyed in part two of the 2025 US Business Sustainability Landscape Outlook: Executive Divides, ESG Blind Spots, and the Future of Supply Chain Resilience, released today by EcoVadis. The report reveals the ripple effects of rising tariff and trade pressures: more than half (56%) of respondents say tariff policies will force their organizations to compromise on sustainability or ESG priorities, with 22% saying significantly so. Only 23% say they will uphold their ESG strategies and commitments regardless of tariff and trade pressures.

While executives agree that trade disputes dominate the risk landscape, views diverge on what comes next. For C-suite leaders, the risk picture is broader with 41% citing extreme climate events and 40% pointing to geopolitical conflict as top concerns. Directors and VPs are focused on operational headaches that disrupt their daily responsibilities, from cyber threats and labor disruptions (both 36%) to ESG regulatory compliance challenges in different regions (33%).

Across functional teams, risk and compliance leaders stand apart, naming cyber threats (63%) as their top concern above tariffs (58%) and labor disruptions (42%). Finance, supply chain, and procurement and sourcing leaders still point to tariffs as their chief risk but differ in what follows: finance leaders highlight cyber threats (34%) and climate events (32%), supply chain leaders point to ESG regulatory compliance across geographies (44%) and geopolitical conflict (39%), and procurement and sourcing leaders cite cyber threats and labor disruptions (both 35%) alongside extreme climate events (34%).

“Tariffs and trade wars are intensifying the pressure on supply chains and exposing cracks in sustainability commitments,” said Pierre-François Thaler, co-founder and co-CEO of EcoVadis. “Leaders are being forced to make trade-offs in real time to balance immediate cost and sourcing pressures against longer-term sustainability goals. The companies that will come out ahead are those using supplier intelligence to see risks early, diversify their options, and avoid letting short-term shocks derail long-term resilience.”

These pressures are adding to the strain of broader supply chain disruptions. Nearly half (44%) of companies experienced 4 to 10 disruptions tied to third-party failures, trade disputes, labor issues, or environmental events in the past year – while 22% faced 11 or more. In response, leaders are taking action to build resilience with 61% working with value chain partners to reformulate product or service offerings to reduce upstream vulnerabilities, 56% focusing on second and third sourcing strategies of key components, 52% actively engaging suppliers on ESG and sustainability issues, 51% shifting sourcing away from risky regions, 36% bolstering supplier risk management capabilities, and 20% turning to continuity insurance.

Other key findings include:

  • Big companies are more likely to hide risks: 16% of all companies admit covering up major sustainability risks in their supply base because the affected suppliers were vital to their business. Among those with revenues above $20 billion, that jumps to 30%.
  • Climate inaction persists: Despite repeated wildfires and hurricanes, 21% of companies have taken no steps to address climate-related supply chain risks, even as liabilities could reach $500 billion annually by 2030.

The report findings are based on a survey of 400 US executives at companies with more than $1 billion in revenue across consumer, industrial, technology, and services sectors. The first report found that most companies are continuing to invest in sustainability, even amid regulatory rollbacks and greenhushing.

Explore the full findings of part two here.

ABOUT ECOVADIS

EcoVadis is a purpose-driven company dedicated to embedding sustainability intelligence into every business decision worldwide. In 2024, EcoVadis acquired Ulula, a leading worker voice platform that strengthens its capabilities in supporting human rights due diligence. With global, trusted and actionable ratings, businesses of all sizes rely on EcoVadis’ detailed insights to comply with ESG regulations, reduce GHG emissions, and improve the sustainability performance of their business and value chain across 250 industries in 185 countries. Leaders like Johnson & Johnson, L’Oréal, Unilever, Bridgestone, BASF, and JPMorgan are among 150,000+ businesses that use EcoVadis ratings, risk, and carbon management tools and e-learning platform to accelerate their journey toward resilience, sustainable growth, and positive impact worldwide.

Learn more on: ecovadis.com, X or LinkedIn.

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