The Supply Shift: Issue #4
Transparency vs. Traceability
In modern supply chains, two words are often used as if they mean the same thing:
Traceability and Transparency.
They sound similar. They’re related. But they’re not interchangeable.
We keep hearing companies say they want one when the other would create more value.
Confusing the two could lead to failed sourcing programs, lost credibility, and misaligned strategies.
Think about the difference this way:
Traceability is like mapping the path of water into a pond.
You can track the flow from the mountain spring, through the stream, into the pond itself. You know where it came from and how it got there.
Transparency is knowing what’s in the water.
The number of species in the pond. How much fertilizer is in it. The temperature.
Combined, you know whether the stream passed through farmland with fertilizer runoff, a healthy forest, or a polluted drainage ditch. The whole story is revealed.
One tells you the route. The other tells you the reality.
A good story requires both, but thinking about which one matters most to the brand and its consumers can help prioritize supply chain investment.
Traceability = Proof of Where
This is your supply chain’s GPS log. It tracks the journey of a product or ingredient from origin to end use.
Where did it come from?
Who touched it?
When did it move?
If you can prove that a box of beef came from Ranch A, then was processed at Plant B, and ended up in Brand C’s burgers—that’s traceability.
Why it matters:
It supports identity preservation
It’s essential for recall prevention, compliance, and origin claims
It builds confidence in the supply chain’s basic integrity
But it doesn’t tell you how it was produced.
For a farm-to-table restaurant, high quality is already expected. The additional value is created by knowing where the product came from. Is it being grown next door? Or from a well known brand regionally? If someone wants to know how it was grown, they can consult the source. Traceability wins.
Transparency = Proof of How
Transparency explains the conditions, practices, and values behind that traceable journey.
How were the animals raised?
What feed was used?
Was the farm sustainable?
Were workers fairly treated?
Transparency = context.
It answers: Was the production regenerative? Low-emissions? Nutrient-dense?
Why it matters:
It enables credible claims
It provides depth to sustainability and health branding
It helps buyers align sourcing with values—not just logistics
For a company like McDonald’s, people seek convenience and cost. Everyone knows that McDonald’s doesn’t buy premium ingredients, but as long as they are honest about their decisions and efforts to improve, nobody minds. Transparency wins.
Why This Distinction Matters
Many CPGs and ingredient buyers are asking for traceability before they have defined what they want to be transparent about.
If you don’t collect the right on-farm and supply chain data, all that time and money spent on traceability just tells you where the commodity moved—not how it was made.
That leaves you vulnerable to:
Greenwashing accusations
Regulatory gaps (e.g. for Scope 3)
Unverified brand claims
…wasted investment
You can trace something that doesn’t meet your standards.
You can be transparent without knowing where a product came from.
Building real trust requires a balance of both, but meeting your internal standards should always take priority.
Finding Success
Traceability secures the chain of custody
Transparency verifies the practices behind the product
Optimizing value requires defining what traceability and transparency means for the brand.
For companies that are just starting down this route, focusing on transparency over traceability will generate quick wins and build confidence towards traceability in the future.
For companies with existing strategies and experience delivering transparency, narrowing down on the value proposition of traceability will tell you where investments should occur next.
Closing Thought
Traceability asks:
“Can we follow the product?”
Transparency asks:
“Can we stand behind it?”
Think about what is most important to your brand today:
Knowing where it came from, or trusting what is in it?