Case Study ยท RedLines Pro
Climate cost exposure quantified across 14 sourcing geographies
How Mondelez mapped climate cost exposure across its ingredient supply chain.
The Challenge
Climate change was creating material cost uncertainty
Mondelez sources key ingredients from climate-sensitive regions across Africa, South-East Asia and Europe. It needed to understand which materials and sourcing locations carried the greatest long-term financial exposure.
Existing approaches relied heavily on qualitative risk registers. The board needed a consistent, forward-looking view of exposure by material, geography, scenario and time horizon.
The Solution
RedLines Pro quantified climate-related cost exposure across the supply base
RedLines Pro assessed 14 key ingredient sourcing geographies under standard SSP scenarios and across multiple time horizons. The analysis covered material physical hazards including extreme heat, flooding, water scarcity and wildfire.
Projected climate conditions were combined with relevant material and sourcing exposure data to compare potential financial impact by ingredient category and region. This distinguished general climate exposure from risks likely to become financially material.
The outputs gave sourcing, risk and finance teams a consistent basis for reviewing supplier concentration, diversification priorities and longer-term procurement decisions.
The Outcomes
What was quantified, and what leaders did with it
Climate-related cost exposure quantified across 14 sourcing geographies and the key ingredients behind them
A repeatable model for future crop yields that the team can rerun as scenarios and sourcing change
The sourcing regions needing closer monitoring identified for senior leaders. Financial return was not measured, and none is claimed
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