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Creating Sustainable Supply Chains

Year after year, the same news is presented in the media: climate change showing its effects. Deforestation, rising temperatures, unpredictable hurricane cycles, droughts, and other consequences have unfortunately become the norm. The urgency for a green economy is increasingly becoming more apparent.

In recent years, much effort has focused on the product’s sustainability, whether it is made of recycled, reusable, or biodegradable material. As we build a better future, we must consume sustainable products; what is also clear is that we must address and understand the sustainability issues arising from the transportation and distribution of these goods.

It is an undeniable fact that logistics and transportation processes have a massive environmental footprint. According to a McKinsey study, supply chains account for 80% of greenhouse gas (GHG) emissions and more than 90% of air, land, water, biodiversity, and geological resources.

A supply chain involves many different parties and pathways between multiple countries; a company’s goals are not necessarily the same as those of its suppliers. Furthermore, the nature of certain products, as is the case with fast-fashion clothing, demands large volumes in short periods, leaving few resources and time to meet sustainability objectives.

It is these very conditions that prevent a company from seeing the whole environmental panorama of its products. Until there is greater control of suppliers and measurement mechanisms in supply chains, a good’s carbon footprint cannot be effectively mitigated.

This is not just about a better future, which of course, should be the number one priority; it is an effort that will ultimately lead to more significant savings. In multinational food and personal care companies, climate change effects led to losses of more than 350 million dollars a year. Considering this, a change is more than necessary.

But what can be done? A long and complex process such as supply chains cannot be re-engineered overnight. What can be done is analyze what is available and generate appropriate solutions. Is space in containers and transport vehicles maximized? What is the environmental impact of current suppliers? Do they share the same sustainability strategies?

There are currently multiple organizations worldwide engaged in environmental consulting to identify conflict areas within the entire chain. Whether resources are being wasted, human rights injustices occur with specific suppliers, and where the bulk of GHGs are being generated.

Once the issues and opportunities are identified, a company has at hand the building blocks for a new sustainability strategy. It is of utmost importance to ensure that suppliers can carry out such a plan. The company’s responsibility is to ensure that its suppliers comply; if they do not, it must assist in its implementation or find someone who does.

These recommendations do not lead to immediate results, but the effects will be more noticeable in the long term. Socially responsible companies are leaders in the growing sustainable economy. Change starts today; it’s time to act.

For more news, articles, and blogs on all things related to logistics, transportation, and customs issues, stay tuned to our website and social media. At Woodward, we have more than 80 years working in domestic and international logistics, always at the forefront of new technologies and industry trends.