Key Takeaways

• Strong safety and operational outcomes start with a solid foundation of core HSE capabilities across the supply chain.
• Expanding beyond this foundation improves visibility of supply chain risk, helping organizations identify and address issues earlier.
• Each risk management capability strengthens oversight, alignment, and control, which contributes to safer and more reliable operations.
• When applied as part of a connected system, these capabilities reinforce one another and close gaps that a single process cannot address.
• Stronger safety performance saves work hours, reduces overhead, and improves operational efficiency.

Introduction

Risk in the supply chain has become constant, layered, and often difficult to see until something goes wrong.

For those responsible for safety or supplier performance, this creates a challenge: how do you move beyond compliance to build operations that are consistently safe and reliable?

For HSE and procurement leaders, this also raises practical questions on where to focus limited resources, how to prioritize risk, and how to connect safety performance to broader operational outcomes.

New analysis based on data from more than 130,000 suppliers across global industries offers a clear answer. Organizations seeing the strongest outcomes are building a stable foundation of core health, safety, and environment (HSE) capabilities — then expanding their approach with additional risk management tools that provide deeper insight into supply chain risk.

Each risk management capability plays a role in the system. Some establish the baseline for safe work. Others surface risk across broader operational, financial, and organizational factors. Together, they create a more complete view of risk, helping organizations prevent incidents, increase efficiency, and keep work moving reliably.

Let’s explore how these capabilities work together, starting with the foundational HSE tools that form the backbone of effective supply chain risk management, followed by the additional capabilities that expand visibility across the supply chain.

Building the foundation: Core HSE capabilities

Effective supply chain risk management starts with a strong foundation. Core health and safety capabilities establish the systems and processes that help organizations identify, control, and reduce risk. These tools create consistency across suppliers, set clear expectations before work begins, and provide the baseline needed to improve safety performance across the supply chain.

Prequalification

Prequalification is where supply chain risk management begins. It verifies that suppliers meet required safety, compliance, and documentation standards before work starts. This creates a consistent baseline across the supply chain.

Early alignment matters. Suppliers that complete prequalification procedures report:

• 18.33% lower severe injury rates
• 34.73% lower fatality rates

By setting clear expectations upfront, prequalification reduces uncertainty and ensures that only qualified suppliers are approved to begin work. It becomes the first layer of defense and the foundation for every improvement that follows.

From a procurement perspective, each compliant supplier:

• experiences $7,037 less overhead per year
• saves 42 work hours per year

Stronger foundations lead to stronger outcomes, both in safety performance and operational efficiency.

Safety audits

While prequalification confirms readiness on paper, safety audits verify whether those standards are applied in practice.

Audits evaluate safety programs, operational controls, and real-world behaviors with both on-site and remote assessments. They uncover gaps that may not be visible through documentation alone and create a structured path for improvement.

The data reflects this added visibility:

• 16.74% lower fatality rates for audited suppliers

Even when injury rates remain similar, the reduction in fatalities highlights the value of identifying and addressing high-risk conditions before they escalate.

From a procurement perspective, each compliant supplier:

• experiences $1,540 less overhead per year
• saves 5 work hours per year

Audits strengthen accountability across the supply chain — helping ensure safety expectations translate into consistent execution.

Insurance verification

Insurance verification ensures that suppliers maintain adequate, up-to-date coverage aligned with client and regional requirements.

While often viewed as an administrative process, continuous verification plays a critical role in maintaining operational integrity. It reduces exposure to financial and operational risk while reinforcing accountability across supplier relationships.

Suppliers that complete insurance verification processes report:

• 16% lower fatality rates
• $621 less overhead annually

By ensuring that safeguards remain in place throughout the lifecycle of work, insurance verification supports both risk reduction and continuity.

Worker Management

Worker management focuses on one of the most critical risk factors: the individual worker.

These systems verify identity, qualifications, certifications, and training before allowing access to a job site — ensuring that every worker is prepared and authorized to perform their role.

With greater control at the worker level, organizations see measurable improvements:

• 14.52% lower severe injury rates
• 22.47% lower fatality rates

When worker compliance is high, fatality reductions can even exceed 50%.

From a procurement perspective, each supplier that participates in a worker management process:

• experiences $5,461 less overhead per year
• saves 34 work hours per year

By improving visibility into workforce readiness, organizations reduce risk at the point where work actually happens.

Worksite Scheduling and Permissions

Worksite scheduling and permissions processes bring supply chain risk management to active job sites.

These tools track safety activities, monitor contractor presence, capture incidents and observations, and ensure site-specific requirements are met before and during execution.

The impact is significant:

• 68.87% lower fatality rates when worksite scheduling and permissions processes are implemented

When combined with structured processes like Job Hazard Analyses (JHA) and End of Project Evaluation (EPE), fatality reductions can reach over 90%.

From a procurement perspective, each supplier that participates in these processes:

• experience up to $23,782 less overhead per year
• saves up to 129 work hours per year

Real-time visibility of contractor and worker activity allows organizations to identify and address risk as it emerges — not after incidents occur.

Expanding visibility: Beyond HSE risk management

As supply chains grow more complex, building on the HSE foundation with greater visibility becomes essential.

Even with strong safety controls in place, many risks sit outside traditional safety processes, including financial stability, ESG performance, cybersecurity, and organizational maturity. Expanding beyond core HSE capabilities gives organizations a more complete view of supply chain risk, improving decision-making, strengthening coordination, and helping teams identify issues before they escalate.

ESG and sustainability

ESG and sustainability capabilities broaden supply chain risk management to cover environmental, social, and governance factors — areas that increasingly influence operational performance.

Structured insights into supplier practices, from labor conditions to ethical conduct, enable organizations to identify risks that traditional safety systems may miss.

Suppliers with more mature ESG practices report:

• 25.42% lower severe injury rates
• 53.5% lower fatality rates

From a procurement perspective, each supplier that adopts these capabilities:

• experiences $11,472 less overhead per year
• saves 59 work hours per year

By broadening visibility, ESG engagement strengthens both safety outcomes and long-term supply chain resilience.

Business risk monitoring

Business risk monitoring focuses on factors that often sit outside traditional safety programs, such as financial stability, compliance status, and operational risk factors.

Suppliers under financial or operational strain are more likely to introduce variability, delays, or unsafe conditions into the supply chain. By tracking these indicators continuously, organizations gain early insight into where risk may be increasing.

Visibility translates into stronger outcomes:

• 9.38% lower severe injury rates
• 28.72% lower fatality rates

From a procurement perspective, each supplier that participates in business risk monitoring:

• experiences $4,974 less overhead per year
• saves 24 work hours per year

By identifying higher-risk suppliers earlier, organizations can act proactively — strengthening both safety performance and operational continuity.

Cybersecurity

Cybersecurity may not be viewed as a traditional safety control, but in connected supply chains, operational risk and digital risk are increasingly intertwined.

Cybersecurity capabilities assess supplier security practices, monitor vulnerabilities, and provide a standardized view of cyber risk across the supply chain. As a result, organizations can better understand how digital weaknesses could disrupt operations, compromise systems, or introduce downstream risk.

Impact extends beyond IT security:

• 9.52% lower severe injury rates
• 22.39% lower fatality rates

From a procurement perspective, each supplier that participates in cybersecurity monitoring:

• experiences $4,274 less overhead per year
• saves 23 work hours per year

By strengthening digital resilience, organizations reduce the likelihood of disruptions that can cascade into operational and safety incidents.

Safety Maturity Index (SMI)

Avetta’s Safety Maturity Index (SMI) is a benchmarking tool that helps organizations move beyond compliance by evaluating how effectively a supplier’s safety system operates.

By assessing leadership, hazard controls, training, incident management, and continuous improvement, the SMI provides a structured view of safety capability.

Suppliers that adopt SMI demonstrate:

• 28.57% lower severe injury rates
• 21.88% lower fatality rates

This shift from compliance to capability enables more targeted improvement over time.

From a procurement perspective, each supplier that participates in the SMI:

• experiences $9,273 less overhead per year
• saves 68 work hours per year

When organizations look beyond whether safety systems are in place and focus on how well they perform, they gain the insight to consistently strengthen safety and operational outcomes.

Each capability delivers measurable impact on its own; but data from Avetta’s global network of 130,000+ suppliers points to a broader pattern. As organizations build on strong foundations and expand their visibility of supply chain risk, they improve alignment between clients, suppliers, and the work itself. Each additional capability strengthens operational standards, surfaces risk earlier, and helps close gaps that a single process cannot address alone. Over time, this creates a more connected and resilient system — one that is better equipped to prevent serious incidents and support consistent performance.

From foundation to performance

A clear pattern emerges across the data: Stronger safety and operational performance come from how organizations build and develop their approach to supply chain risk management.

The most effective supply chains start with a strong foundation of core HSE capabilities, then expand visibility of supply chain risk, and apply those tools as part of a connected, strategic system. Each capability reinforces the next — strengthening oversight, improving alignment, and helping teams identify and address risk earlier.

As these capabilities work together, organizations gain a more complete view of risk and a more consistent way to manage it. The result is safer operations, stronger performance, and supply chains that are better equipped to keep work moving reliably.

Download Avetta’s Insights & Impact Report 2026

Our analysis of individual risk management capabilities highlights their impact, but it also points to a broader opportunity. When these tools are applied together, they create a more connected system of visibility and control that further strengthens safety and operational performance.

Download Avetta’s Insights & Impact Report 2026 to see how layering risk management capabilities drives even greater reductions in injuries and fatalities, while improving efficiency, reducing costs, and helping supply chains stay ready to work.