In this Supply Chain Matters blog commentary we focus on this week’s sobering report from the United Nations Intergovernmental Panel on Climate Change (IPCC) that provides stark conclusions on the state of our planet.

Among the report’s takeaways is that “it is now unequivocal that human influence has warmed the atmosphere, ocean and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere have occurred.” The consequence are already upon global nations in the form of record-breaking climate events. Further indicated is that even if the community of nations started to sharply cut emissions right now, global warming will rise even more within the next two decades.

In essence, the report’s conclusion is that a hotter Earth is now locked in, that changes as a result of higher greenhouse gas emissions are already “irreversible” and more drastic mitigation measures are required by all nations.

United Nations Secretary General Antonio Guterres summed the report’s findings as “a code red for humanity.” The report itself represents investigation and findings from 234 researchers and the full report consists of upwards of 4,000 pages while report reviewers indicate that never before has such stark and direct language eminate from multiple scientists and the UN.

Media outlets such as The Washington Post and the New York Times have termed this report as the most comprehensive look at the state of climate science. The headline from the Times seemed to sum the essence of the report’s takeaway: A Hotter Future is Certain, Climate Panel Warns, But How Hot is Up to Us. (Paid subscription or metered view)

An excerpt from this Times further summarizes the takeaway conclusion s from the UN Report:

Not all is lost, however, and humanity can still prevent the planet from getting even hotter. Doing so would require a coordinated effort among countries to stop adding carbon dioxide to the atmosphere by around 2050, which would entail a rapid shift away from fossil fuels starting immediately, as well as potentially removing vast amounts of carbon from the air. If that happened, global warming would likely halt and level off at around 1.5 degrees Celsius, the report concludes.

But if nations fail in that effort, global average temperatures will keep rising — potentially passing 2 degrees, 3 degrees or even 4 degrees Celsius, compared with the preindustrial era. The report describes how every additional degree of warming brings far greater perils, such as ever more vicious floods and heat waves, worsening droughts and accelerating sea-level rise that could threaten the existence of some island nations. The hotter the planet gets, the greater the risks of crossing dangerous “tipping points,” like the irreversible collapse of the immense ice sheets in Greenland and West Antarctica.”

As to the degree of urgency, this Editor has heard two scientists indicate that the window of stepped-up mitigation efforts is during the next five years.

We urge all of our readers to take the time to at a minimum review the summary findings and conclusions.


Implications for Ongoing Multi-industry Supply Chain Initiatives

The implications for this week’s report are obviously very concerning and alarming, but at the same time provides opportunities for stepped-up efforts and added market and business opportunities.

In a prior Supply Chain Matters blog published at the end of May, we characterized a monumental week for global sustainability efforts when several large and powerful energy companies encountered what Politico described as: “a series of extraordinary blows after shareholders, customers and the courts turned on the industry out of concern for climate change.

This week adds to that byline and there will surely be more monumental weeks to come in regard to more aggressive and forceful sustainability influences.

Our overall perspectives are the following:

Supply Chain Sustainability actions are now no longer optional in that they must now have context to an overall business continuity plan reviewed by senior executives and shareholders. There already indications that within the coming months, every public company doing business in the U.S. will likely have to report climate information related to products, services and their respective supply chains.

Actions will have to involve not only individual manufacturers, retailers and services providers but the vast amount of infrastructure players that support global commerce to include ocean shipping, rail, air, surface transportation and material handling movements. Carriers have tended to drag out efforts toward less dependency on fossil fuels, or initiate means to have shippers and beneficiary cargo owners fund sustainability efforts in added surcharges and rate structures. We believe that concerted climate change mitigation efforts on the part of collective nations will lead to pressures and/or incentives for accelerated timetables. Europe will not be the only region providing leadership in such efforts.

Consider the climate events that already occurred with the business disruption and monetary impacts consequences growing larger. The UN report conclusions imply that concurrent and multiple changes in climatic impact will now occur in combinations of destructive events, one leading to the other.

While existing initiatives may have context to consumer desires to do business with responsible companies, a new imperative is that supply chains and the infrastructure that supports global commerce must take the lead in reducing dependency on fossil fuels within the next decade, ideally the next five years.

Some companies have carbon neutral goals that extend to the year 2050. We anticipate that such a window is no longer valid and that there will be considerable pressures or monetary incentives on the part of global leaders and institutions to accelerate existing timetables.

There are also opportunities presented in an accelerated timetable toward zero dependence on fossil fuels. That includes added demand for alternative fueled vehicles, new business models that weight carbon impact for customer fulfillment and in new advanced technologies that can be leveraged for lower fuel costs and more efficient production and transportation processes. Software and technologies can provide added means to analyze carbon consumption, reduce unnecessary trips or provide more seamless and synchronized inter-modal transport.

The next five years may well present a rethinking of the notions of global supply chain movements in favor of more regionalized supply chains serving specific market regions.

Indeed, the global community may hopefully look back to this week as the start of a discernable inflection point in sustaining our planet along with the realization that supply chains did their part in action planning and new business models.

Bob Ferrari

© Copyright 2021, The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.