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The green supply chain

Jul 4, 2013 2:30:33 PM - www.ft.lk

A truly green supply chain is one that goes beyond just transport. Transport is one factor that contributes to the carbon footprint created by an organisation and the products it produces, as such it is imperative that businesses start looking at the carbon emissions associated with their supply chain and the goods they produce.
Although some may have considered reducing emissions within their own organisational boundaries, many may not have considered the impact they have outside these boundaries. Many major companies globally have introduced environmental checklists that suppliers must now complete if they are to continue providing products and services.
In order to keep ahead and track supply chain emissions of a business, two major actions can be taken:
1. Identify and engage in lifecycle thinking
2. Reduce supply chain carbon through appropriate strategies
Identifying and engaging in lifecycle thinking
At every stage of a product’s lifecycle, from the extraction of raw materials to its consumption and disposal, a carbon footprint is left behind. Understanding and quantifying each steps enables an organisation to identify it total carbon footprint. This is achieved through the process of a full lifecycle analysis of a footprint resulting in a complete breakdown of the carbon emissions and their source at each of these stages.
For many smaller businesses and possibly some larger ones, conducting a full lifecycle analysis can be cost prohibitive, leading to this important process being filed away. However a low-cost, high-level assessment of a product’s lifecycle can give the businesses management an overview of the carbon emissions being emitted and the savings available.
A simple way to understand and undertake a low-cost high level assessment is by considering what the product’s lifecycle means to the business. Is having a recyclable and environmentally friendly product good for the organisation’s image and does it form part of its marketing strategy? Could procurement costs be reduced by rationalising upstream processes?
Developing a high-level map of the businesses product lifecycle: List all the key processes along the supply chain that contribute most to a product’s carbon footprint. Get unit managers/department heads to develop these for each of their relevant areas and then create an organisation-wide map. An organisation-wide sustainability committee/team made up of senior and junior staff should be put in place to coordinate efforts and provide strategic direction.
Focus on the most carbon-intensive processes: Taking the list developed above, identify and brainstorm strategies for reducing their impacts. Make individual unit managers/department heads responsible for this task and have them bring back the strategies to the organisation wide committee. It is important here to not only focus on what can be done internally, work with suppliers to help reduce the businesses own carbon footprint and also their carbon footprint. Identify cuts in energy and material use, or work exclusively with suppliers who have already adopted low carbon practices.
Reducing supply chain carbon through appropriate strategies
Improve the business’ own supply chain practices: Improvements can be made quite easily by altering an organisation’s procurement (inputs) and waste disposal (outputs) practices. Make the organisations procurement manager/team responsible for identifying suitable products and services, this person or team is a critical part of any overall committee that is tasked with making an organisation more carbon neutral.
Waste management and disposal is also a hugely expensive and often disregarded factor but very important in reducing the overall carbon footprint of an organisation. Changing the mentality around waste management is the responsibility of every member of an organisation. Get external assistance through a specialist energy efficiency consultant if needed.
The importance of getting suppliers on board: Provide a business’ suppliers with an overview of the organisations new carbon neutral strategy and inform them about the crucial part they will play in helping the organisation achieve its targets and actions.
Make them aware of the benefits of positive results and share successes with them. Start with one or two suppliers and showcase success the business has with them to get other suppliers on board and give them useful ideas. If all else fails locate suppliers who have already taken responsibility for their carbon emissions.
Sharing information: This point is self-explanatory, however many organisations and individuals fail to see the importance of information exchange. This is not only good for the organisation’s image but also helps create a positive impact through the organisation’s sphere of influence.
Offsetting lifecycle impacts: Identify local opportunities for offsetting the impacts of the organisation’s supply chain. Contact organisations like the Sri Lanka Wilderness Foundation to be part of reforestation programs.
(The writer is Director, Business Partner Solutions Ltd. www.bpslk.lk/shenal.basnayake@bpslk.lk.)