Using AI to detect supply chain risk in 2024

A well functioning supply chain is vital to a company’s success, yet the risks across supply chains have never seemed greater. From human rights violations, to environmental factors, labour and land disputes, geopolitical factors, and a myriad of other economic, environmental, political and social factors these pressures have all. intensified under the introduction of more stringent supply chain laws. These supply chain risks can incur significant economic costs and reputational damage with Deloitte’s Global Survey on Reputation Risk revealing that “on average, more than 25% of the company’s market value is directly attributable to its reputation.”

Supply chain risks have never been greater

Although risk has always been a factor organizations must consider, it has never before had the chance to inflict as much damage as does so quickly today thanks to the immediacy of the news cycle. This leaves little room or time for businesses to prepare internally for the potential backlash and mitigate the damage. Research shows intangible factors account for 63% of a public company’s market value. Such market value can easily drop in the case of scandal and can have a negative financial impact on the company.

Figure 1:  Example of supply chain monitoring for a UK supermarket, the colour responds to positive/negative data on the supplier and the label denotes the number of media data-points.

Automating supply chain risk monitoring

At Permutable, we help clients from all across the world to help monitor in incoming issues that may be affecting their entire supply chain. We also know from our work, using Natural Language Processing, just how much supply chains can expose companies to hidden, seemingly uncontrollable risks and the negative affects of neglectful ESG screening across their supply chain network

By using AI, we analyse real-time news about suppliers from publicly available online media sources (in all languages) across the world, using Natural Language Processing to scrape vast amounts of data to flag up any suspicious of potential violations related to the UN’s SDGs and ESG data points. including criteria such as environmental pollution and consumption of natural resources, human rights violations, product liability, corporate governance etc. using a tagging system of geo-location, time stamping, as well as the aforementioned topics to signal, analyse and filter potential suspicious activity. 

Uncovering supply chain risks at early stage

In layman’s terms, we use GPT 4 technology to look at what a company says they are doing in these areas vs what is being reported about them, enabling our clients to uncover violations at early stage, and deal with them in a timely and appropriate manner, to mitigate supply chain risk.


For companies who have entered into a code of conduct with their supply chain partners. this enables them to unearth any environmental, social or compliance issues within their supply chain and carry out ongoing assessment of their business partners. This enables them to ensure that their sustainability performance is in line with their own standards. 


The use of AI is becoming an increasingly important part of supply chain risk monitoring and management which compliments already existing channels and tools in an increasingly complex climate. By using cutting edge technology, what would take a supply chain compliance department months to do, now only takes a couple of days. 


Figure 2: Weekly monitoring of company Environmental issues for a major UK supermarket retailer.

Real-time and constantly improved monitoring

One of the main benefits of using AI to monitor supply chain risk is that our intelligent algorithms and NLP technology is constantly learning. The system is continuously improving in it’s ability to recognise and flag up risk indicators. Moreover, the real-time nature and speed at which the AI sifts through source data and recognises risk factors, enabling our clients to be aware of and assess any supply chain risk factors promptly, enabling the potential for swift action and recourse is an immensely powerful business benefit.

Book a demo below to discover how our technology can help you detect and mitigate supply chain risk swiftly