Sustainable Supply Chain
What is it?
Supply chains are critical links that connect an organization’s outputs to its inputs. Supply chain sustainability is a business issue affecting an organization’s supply chain in terms of environmental costs, risk and social impact costs. Sustainable inputs generate sustainable products, a prerequisite for sustainable – and thus survivable – organizations.
Why is it important?
Measuring and improving sustainable performance internally, is half the job; a company must also look at the sustainability performance of its suppliers. For organization survivability, monetary costs and supply process attributes such as just-in-time delivery and lower transport times can no longer be the dominant factors in evaluating supply chains. Growing consumer pressures for environment-friendly products and processes, as well as increasing environmental costs in obtaining and processing resources, impels executives to introduce environmental and social considerations in measuring supply chain profitability.
Today, more and more managers realize that a Sustainable Supply Chain implies a profitable supply chain. Concern for sustainable supply chain improves risk management regarding unsatisfactory performance of a supplier. This is quite crucial, since:
- Consumers, as well as the organization’s shareholders, are becoming more and more sensitive to sustainability issues (e.g. pollution) and ethical issues (e.g. child labour) and thus predisposed to “punish”, not only the organization but also the organization’s customers and collaborators.
- Most Eco-labels, such as the Carbon or Water Footprint, and eco-practices require a Life Cycle Analysis which, by definition, takes into consideration the supply chain; in many cases, the major environmental impacts of a product relate to this chain.
Close the Loop helps the organization manage effectively its supply chain and upgrade it to a Sustainable Supply Chain. More specifically, we support:
- The development, in unison with the organization’s sustainability strategy, of quantitative and qualitative criteria (as, for example, the EPD attributes) and performance indicators for the evaluation of suppliers
- The evaluation of suppliers with supplementary tools and methods, such as LCA, Carbon Footprint and Water Footprint, as to their impact to the organization’s performance
- The gradation of suppliers by their impact to the sustainability performance of the organization; selection of those with most positive impact
- Competitive commercial advantage for eco-sensitive and environment-conscious customers and markets
- Substantial improvement of the sustainability performance of products and services
- Discovery of more reliable/safer/economical suppliers
- Reinforcement of collaborations with suppliers or other organizations to share/reduce costs and risks in win-win arrangements
- Improved logistics networks
- Substantial contribution to your Corporate Responsibility Strategy and Sustainability Report
- Effective risk management
The supply chain and its impact on the sustainability performance of products or services, or even of the whole organization, are at the forefront of the bid for Sustainable Development. This is recognized as self-evident, since suppliers, production processes, customers and shareholders constitute interdependent parts of an integrated Whole, and links of a continuous chain. They are all connected systemically. Every part affects the behaviour of every other, and of the Whole. Concentrating on a single link (e.g. customers, production process, or suppliers) could be futile, if the organization’s survivability is at stake. The importance of these interdependencies is evident when employing tools like LCA and Carbon or Water Footprint. Unquestionably, the systems approach is unavoidable.
All actions, studies and analyses of Close the Loop are based on a systems approach. The organization or the company is always viewed and examined as part of a broader environment which includes all interested parties, regulatory bodies, shareholders, suppliers and customers. Such a Life Cycle approach, aiming at a Sustainable Supply Chain, highlights real opportunities for easily reducing costs and environmental and social impacts.
Ourscientific expertise in decision-making tools and decision support systems, such as the systems approach, allows us to effectively structure the process of evaluating the suppliers and selecting those with the most positive impact on the organization.
In all its endeavours, in all its projects, Close the Loop adopts the internationally acknowledged approach of the International Project Management Association (IPMA); it is a management approach that ensures life-cycle impact and costing consideration, fulfilment of the objectives within preset time and cost restraints, respect of environmental and social obligations and, mainly, stakeholders’ satisfaction.