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ACCA Applied Knowledge · Business and Technology · Sustainable business practices

Karolis Ltd, a furniture maker, now buys timber only from suppliers certified as replanting the forests they harvest. Which aspect of sustainable business practice does this most directly illustrate?

This is responsible sourcing in the supply chain. By buying only from suppliers certified as replanting harvested forests, Karolis extends its sustainability commitments beyond its own operations to the resources it depends on, reducing environmental harm and reputational risk linked to its inputs.

  1. AResponsible sourcing within the supply chainCorrect
  2. BVertical integration to reduce costs
  3. CA cost leadership strategy
  4. DDiversification into unrelated markets

Explanation

Requiring suppliers to meet environmental standards is responsible (sustainable) sourcing, managing environmental impact beyond the company's own operations. It is not about integrating the supply chain, cost leadership or diversification, since Karolis still buys externally and stays in furniture.

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