Guest post by: Justin Floyd, CEO of RedCloud
Most corporate ESG strategies focus on visible, incremental improvements. Companies invest in sustainable packaging, carbon offset credits and compliance reporting. They appoint Chief Sustainability Officers to measure progress and publish annual updates.
These efforts matter. But they often overlook a systemic failure that undermines many sustainability initiatives at once.
Every year, an estimated $3 trillion of fast-moving consumer goods is wasted globally. That is not just spoilage. It is excess production, expired inventory, write-offs and forced discounting embedded into the system by design. This level of waste represents a material environmental and social cost that is increasingly difficult to justify as a normal cost of doing business.
Global trade is running on an operating system that hasn’t changed since the 1970s.
The blind supply chain
The root cause of this waste is guesswork.
For decades, the world’s largest manufacturers have been flying blind. A brand produces a million units of detergent or soft drinks. They ship them to a distributor. The distributor ships them to a wholesaler. The wholesaler sells them to a retailer. At every step of that journey, visibility is lost.
Once a product leaves the factory gate, it effectively disappears into a chain of intermediaries. The brand sees purchase orders. It does not see consumption. The manufacturer has no real-time data on who is buying their product, where it is being sold, or what the actual demand is, so they overproduce. They flood the market with inventory to avoid stockouts, accepting that a significant percentage will simply go to waste. They rely on historical spreadsheets and manual orders, which are by definition reactive and slow.
This ‘push’ model is dangerously inefficient. You make things, push them into the world, and hope they sell. It wastes raw materials. It wastes fuel on unnecessary transport. And in emerging markets, where food security is critical, it wastes calories.
Moving from ‘push’ to ‘predictive’
You don’t solve a $3 trillion problem with paper straws. You solve it by changing how decisions are made.
By digitizing the supply chain and connecting manufacturers directly to distributors and retailers on a unified protocol, we turn the lights on. We replace guesswork with demand signals. This is where AI becomes a critical sustainability tool – not as a communications tool, but as infrastructure.
Predictive AI systems built on live transaction data from thousands of merchants allows businesses to anticipate demand more accurately, identify imbalances earlier and intervene before waste occurs. The system shifts from pushing inventory into the market to pulling it based on real consumption. This means that you only produce what is needed, you only ship what is sold and you stop moving air.
Efficiency is sustainability
When we use AI to eliminate the friction in global trade, the ESG impact is immediate. Fewer goods are manufactured unnecessarily, fewer shipments move without clear demand and emissions linked to excess production and transport fall at the source, rather than being managed after the fact. At the same time, better visibility improves margins for distributors and brands while ensuring more reliable access to essential goods for consumers
If ESG is about long-term environmental responsibility, social resilience and sound governance, then fixing the inefficiencies embedded in global trade should be a priority. ESG cannot remain a reporting exercise layered on top of inefficient systems. It must become an operational redesign. Until trade itself becomes intelligent, sustainability will remain cosmetic.
