On this recognition of Earth Day in the year 2021, it is important for global supply chain management teams to remain focused on the critical role they have in helping to save our planet in some many dimensions of effort and contribution.

There is the reality that 70-80 percent of emissions stem from supply chain related activities and that aggressive goal setting, disclosure and mitigation remain critical, and is influencing product development plans with sustainability factors in-mind.

The Ecovadis 2020 Business Sustainability Risk and Performance Index that is based on cumulative 2015-2019 performance data drawn from more than 40,000 companies globally indicated that while business sustainability index performance was improving through 2019, scores in sustainable procurement remained in their lowest levels. While North American based companies had led in active reporting of carbon emissions, European based companies were leading in implementing actions in reducing emissions. Greater China reportedly remained as the lowest scoring region.

In our Ferrari Consulting and Research Group’s 2021 Predictions for Industry and Global Supply Chains published in January of this year, we predicted that the COVID-19 pandemic’s learnings and realizations in 2020 will lead to a more active focus on both business sustainability and corporate social responsibility efforts over the coming years, as global and regional economies begin to improve. There is an increased belief that the pandemic and the consequent economic and social impacts, have undone many human rights or diversity gains that companies have made. The significant disruptions that occurred among domestic and global supply networks provided added senior management recognition to the importance of supplier relationships as being an extension of business sustainability. Thus, organizations will face heightened attention surrounding sustainability and CSR oversight and initiatives.

The opportunity for new thinking is to view product demand and global supply networks in the dimension of overall business sustainability and corporate responsibility. There is now a building emphasis among companies towards embracing environmental sustainability in the lens of a circular model, a concept to avoid production of any waste while emphasizing the packaging and use of products in advanced forms of recycling or re-use. Such strategies differ from commitments in energy consumption or strictly carbon reduction and emphasize more focus on renewable energy and reductions of reliance on fossil fuels. This is a rather important differentiation for supply chain focused initiatives.

For our part, Supply Chain Matters remains committed on this Earth Day in providing a more active focus and education on industry supply chain sustainability efforts and directions. Last month we featured a three-part series on the subject of food waste and the need for more agile and socially conscious food supply networks.

In that vein we were pleased to read this week that U.S. grocery chain Hannaford Supermarkets achieved major sustainability milestone for sending no food waste to landfills. Hannaford donates and diverts all unsold food, is the first large-scale supermarket retailer in New England and New York to mark this achievement at each of this grocery chains over 180 stores. This retailer’s zero food waste program kept 65 million pounds of food waste from reaching landfills in 2020.

Next week will share additional commentary related to Earth Day.

We all have a critical role to play, as businesses, supply chain teams, and as consumers of products and services.

Let us save our planet in all of the dimensions that we can.

 

Bob Ferrari

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