51% of North American Supply Chain Executives Consider Sustainability a Strategic Priority, but lack of funding and resources hamper efforts
A study by Loyola University’s Supply and Value Chain Center, West Monroe Partners and BearingPoint found that more than half (51%) of North American supply chain executives say having a green supply chain is a strategic priority. While an additional 36% plan to address green supply chain in the short-, mid- or long-term, there are still 12% that place no importance on green supply chain.
Interestingly, there isn’t a strong correlation between size of organization and commitment to sustainability – several of the organizations that aren’t doing anything currently are multi-billion dollar companies. Improved competitive advantage and brand image are the key motivators for sustainability.
The study also found that while appetites for sustainability exist; budgets and resources do not. It appears few companies are embracing sustainability initiatives in any meaningful way. Until regulations force action, many companies won’t be able to find resources and funding to make significant change.
Firms have a tremendous opportunity to create competitive differentiation by embracing sustainability now, benefits include:
–Improved brand image
–Meeting customer needs
–Improved the ease of recycling
–Reduced production and logistics costs
–Differentiation from their competition
As supply chain teams struggle to manage the complexities of globalization, the war for talent and increasing consumer demands allocating budget and resources towards sustainability isn’t always feasible unless companies can put together a business case for the return on the investment.
The business case should include, at a minimum:
–A carbon footprint assessment that identifies, quantifies and contextualizes environmental impact
–A customer sentiment analysis to determine potential revenue upside
–Bottom line cost savings
The United Nations Global Compact Sustainable Supply Chains website is a one-stop-shop for business seeking information about supply chain sustainability. On this website, you will find information designed to assist business practitioners in embedding sustainability in supply chains.