When Cargill stopped doing business with a palm oil supplier that was facing accusations of environmental and human rights violations, it was just one of many indicators of how far companies have come on the supply chain sustainability front over the last few years. Defined as a holistic view of supply chain processes and technologies that addresses the environmental, social, legal, and economic aspects of a supply chain's components, supply chain sustainability helps organizations better understand that they’re part of a larger system, and not just operating as single entities.
Cargill, which is on track to achieve a 100% transparent and sustainable palm oil supply chain by 2020, isn’t alone in its quest. Numerous electronics companies, in fact, have joined the fray and taken steps to create more sustainable supply chains. In 4 Supply Chain Predictions for 2018, Forbes notes that transparency and sustainability will shape consumer demand, and discusses how the “explosion of demand from consumers to know where their products are originating” and extremely granular information requirements are pushing more companies to rethink their supply chain sustainability approaches.
Take the NextWave consortium, for example. The group includes Dell, General Motors, and other corporations, all of which are working to industrialize the use of ocean-bound plastic in manufacturing by collecting it before it reaches the sea, according to Oceans Deeply. Through this initiative, the organizations are bringing “industrial scale to artisanal efforts to tackle the ocean plastic pollution crisis by building a supply chain to intercept plastic trash and turn it into everything from packaging and furniture to bicycle parts,” Todd Woody writes in Dell, GM to Create Ocean Plastic Supply Chain to Fight Marine Pollution.
Tech Steps Up
Within the electronics realm, Dell products that can be made from the ocean-bound plastics include packaging trays for laptop computers, package handles, cushions used in desktop computer packaging, and other shipping materials, Woody writes. “Any place we can use a plastic and get it from mismanaged waste and into a recycling stream, that’s how we believe we can scale usage and really start to tackle the problem of ocean plastic,” Dell’s Oliver Campbell told Oceans Deeply.
“Our initial estimates are that we can do this at a lower cost with the same quality and performance,” he continued. “That’s how you scale sustainable solutions and ocean plastic is no different. It’s critical to our business that we continue to drive costs and we believe we can do that with ocean plastic.”
Building Blocks of Sustainability
Companies looking to create their own sustainable supply chains in a world where climate change, human rights issues, and environmental issues are all playing a role in consumers’ buying choices can start the processes by examining their own procurement approaches and working to gain better visibility over their suppliers’ activities. In 3 Steps to Improve Supply Chain Sustainability, Jeremy Bodenhamer notes that sustainable practices have become a critical component in how customers and companies are defining success. “In fact, according to a recent Unilever study, one in three consumers are making buying decisions based on social and environmental impact,” he writes. “Sustainability has become a market opportunity worth more than $1 trillion.”
Taking the time to understand the impact (i.e., where does all the plastic packaging that’s being produced actually go once people are done with it?); setting goals, and then discussing those goals with vendors, partners, and customers; and leveraging technology and data, all go a long way in helping organizations operate more sustainability.
“Building a sustainable supply chain has many benefits. Not only do green practices open doors to new selling opportunities, but they also offer excellent options for reducing costs,” Bodenhamer writes, noting that Procter and Gamble reported cost savings in excess of $1 billion while cutting its environmental impact in half. “Although bottom line improvements are nice, the real benefit is being part of a solution that will create a better workplace for our employees and a better planet for our children.”