Case Study ยท RedLines Pro
Understanding climate cost exposure across global materials
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
A quantified foundation for climate-smart sourcing decisions
Senior leaders gained a clearer understanding of climate risk across key ingredients
Established a repeatable capability for modelling future crop yields
Highlighted the sourcing regions requiring closer monitoring
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