Sustainability as a risk-management imperative: A stakeholder analysis of supply chain reform in the UK fast-moving consumer goods sector

Abstract

Sustainability has shifted from a voluntary reputational activity to a core determinant of regulatory compliance and market access within the United Kingdom fast-moving consumer goods (FMCG) sector. This paper critically evaluates the strategic and operational implications of sustainability-driven supply chain reform, using Unilever UK as an illustrative case. Drawing on secondary industry and regulatory data, the study applies PESTLE, Porter's Value Chain, the Balanced Scorecard, Mendelow's Power–Interest Matrix, and the Stakeholder Salience Model to examine how regulatory, retailer, and supplier dynamics jointly shape sustainability outcomes. The analysis finds that retailers function as de facto regulators, translating statutory requirements into commercial conditions such as delisting, and that supplier capability gaps – with over a quarter of suppliers lacking basic traceability systems – represent the principal constraint on compliance. The paper proposes a three-layer sustainability constraint model (regulatory enforcement, retailer amplification, and supplier capability) and argues that sustainability now functions primarily as a strategic risk-management imperative rather than an inherent source of short-term competitive advantage. Prioritised, KPI-linked recommendations are offered covering supplier capability building, phased digital traceability investment, and deferred sustainability optimisation. The paper contributes a structured account of how regulatory pressure is mediated through commercial power in contemporary FMCG supply chains.