Blog Post

Sustainability and the importance of Supply Chain

MACK BHATIA

Importance of Green Supply Chain™

Sustainability, is no longer a distant term, and is at the core of many organizations and their strategic initiatives. The research shows that the quarter of the world’s top corporations have commitments for credible climate action for 2030. This number has certainly increased over the last few years, however we still have the other three-quarters of the top tier companies who should ideally step up. We do anticipate that the outcome from those companies with a credible sustainable action plan and looking at their results, like any other industry, will encourage and others to join the bandwagon. 

Corporate responsibility was existent in many companies but the general observation is that climate change, as it sits now, is no longer an optional category among the Corporate and Social Responsibility objectives. This transition seems to be driven by many factors including investor expectations, business cases, customer expectations, demands from employees and more.  Out of all factors however, we noticed that the business leaders were more attentive becoming industry compliant and to gain a competitive advantage among their peers. The two reasons are enough and an adequate push for corporations to take actions and reduce their carbon footprint. The 3rd reason, and rather an important factor is - Transparency. 

Transparency, as a matter of fact, has two advantages – First, the more transparent we are with our sustainability action plan and the steps business leaders take to measure the commitments, the more trust is what we develop with our investors and customers. The second is that corporations largely benefit from transparency as they are able to identify potential inefficiencies and focus on opportunities as a transparency's by-product.

The biggest opportunities through transparency lies in any organization’s supply chain. General Motors, as an example was not only able to reduce their costs in supply chain, but through their supply chain compliance program, was able to manage significant risks through systematic and collaborative efforts with their 3400 strong supplier base.

Supply chain has a significant contribution to any measurable goals defined by an organization’s sustainability action plan. Many organizations sooner or later realize that their goals will not be met unless they have visibility into their end-to-end supply chain. This is until steps are undertaken to optimize the supply chain operations. 

As an example – one of the 5 sustainable commitments as defined by BIC Inc. “Writing the Future, Together” program is to ensure that the company is able to identify and collaborate with the strategic suppliers and ensure most secure, innovative and efficient sourcing among their complex supply chain. However, to achieve the objectives the supply chain participants should be able to track the journey of the supplies and should be able to engage and build trust among themselves. 

Mr. Chintan Shah, who heads the Supply Chain Operations in Canada for BIC Inc. articulates this concept really well. “Optimizing our supply chain is one of our key sustainability commitments. Our internal assessment indicates that we can achieve our goals when we work together with our suppliers and vendors. We will now like to track the journey of our supplies and have plans to engage and collaborate with our Tier 1 suppliers to help us meet our objectives.”

As observed, most companies realize that either most GHG emissions, or the maximum percentage of waste occurs somewhere or around the journey of a supply chain. Companies will also want to encourage their suppliers to follow the path of sustainability. Eventually customers and investors will want to have a transparency on the ethical practices of the companies they invest in and will demand transparency on the source of product that they just purchased.

SIOChain™ is one of the platforms that can help achieve this. Contact us to know more and how our team can develop your action plan or support to help you achieve a sustainable supply chain.

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