The Rise of Sustainable Supply Chains

After the recession of 2008 companies got leaner and part of this new way of doing business involves looking at inefficiencies throughout the value chain as a way to leverage cost and enhance savings. Lean efforts have been demonstrated to yield substantial environmental benefits (pollution prevention, waste reduction and reuse opportunities) as well as leverage compliance issues.

Although sustainable supply chains have been steadily growing, in 2010 we saw an explosion of activity. The growth of greener supply chains in 2010 included a much greater focus on monitoring, measurement and verification from a host of companies including Wal-Mart, IBM, Proctor and Gamble, Kaiser Permanente, Puma, Ford, Intel, Pepsi, Kimberly-Clark, Unilever, Johnson & Johnson, Dell, AT&T, P&G, and Herman Miller.

In addition to private enterprise, government agencies in the US (General Services Administration) and abroad (DEFRA in Britain) have set green standards and guidelines for federal procurement.

Major value chain concerns such as materials water and waste management, are part of a growing sustainability trend where companies are increasingly concerned with their suppliers’ sustainability efforts.

Corporate social responsibility issues including addressing concerns for human rights, fair labor and sustainable development got a lot of attention from big companies like Nestle, Corporate Express, Danisco, Starbucks, Unilever and the apparel industry.

Companies are embracing transparency and collaboration in the supply chain in an effort to be truly sustainable. They are getting on board with supply chain sustainability because they can’t afford to be viewed as laggards and because they recognize that there are very real benefits to being first movers with green technological innovation.