Executive Summary
Supply Chain Survey
The sustainable supply chain is the future supply chain. Rising
populations and resource scarcity mean doing more with less.
However, sustainable supply chains are not solely about
regulatory compliance and meeting customer or consumer
expectations; they are also about increasing efficiency and saving
money. Collaboration is critical to realizing these benefits; not only
within the supply chain, but at times also with external agents such
as non-governmental organizations (NGOs).
“More than two-thirds of all
respondents also say sustainability
will play a more important role in
the supply chains of the future.
A number of companies have
already started investing in
technologies to reduce their carbon
dioxide emissions and excluding
any supply chain partners that
don’t adhere to the highest ethical
standards.”
Sustainability and supply chain integrity initiatives require
manufacturers and their supply chain partners to identify and
PwC Global Supply Chain
eliminate processes and activities that are environmentally or
Survey 2013
socially unproductive. Corporate social responsibility (CSR)
initiatives are becoming drivers of supply chain decisions, with
increased pressure and visibility on organizations that don’t operate responsibly.
Successful collaboration needs tools to facilitate it. Data Discovery software bridges information gaps
between stakeholders through a simple and easy interface, helping to open up new analytical paths and
data visualizations. Only then can the full benefits of a sustainable supply chain be reaped, both for the
environment and for the bottom line.
The Sustainable Supply Chain | 3
Sustainable Profits
With declining crop yields, mass floods, tens of millions displaced
and up to 40% of species facing extinction, the ethical and
environmental reasons for going green are seemingly abundant
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and clear. Unfortunately many businesses believe the
misconception that implementing sustainable initiatives mean
adding complexity and costs. In reality, becoming sustainable is
about the exact opposite. It is about reducing costs, increasing
efficiencies and improving goodwill.
Consumer pressures have played a significant role in promoting
sustainable initiatives. Corporations must actively display a
responsible operation which includes taking steps towards
minimizing their environmental footprint, providing a fair deal to
everyone in the supply chain and actively improving conditions in
areas where they operate. Failure to do so can result in brand
damage, leading to a loss in market share. For example, Apple
has suffered highly negative publicity over the working conditions
of its Chinese workers in its partner, Foxconn’s, manufacturing
plant. And in the case of Shell and Halliburton, brand damage was
combined with multimillion-dollar fines when allegations surfaced
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of bribery of Nigerian government officials.
Yet regulations are arguably the real muscle behind sustainable
initiatives. Many organizations are required to comply with
legislation in different market jurisdictions e.g. RoHS, REACH and
WEEE. Violations can result in expensive penalties and other legal
risks. These activities are underpinned by data and collaboration
and involve measuring performance, benchmarking and
communicating performance to multiple stakeholders. Traceability
and location data helps create smarter supply chains. Companies
now have to comply with new, stricter standards of CO2 emissions
set by bodies such as California Air Resources Board, whose goal
is to improve air quality.
Supply Chain
Sustainability Definition:
“The management of
environmental, social and
economic impacts, and the
encouragement of good
governance practices, throughout
the lifecycles of goods and
services. The objective of supply
chain sustainability is to create
protect, and grow long-term
environmental, social and
economic value for all stakeholders
involved in bringing products and
services to market.”
Dr. Pieter Nagel, Executive Director
of the Alliance for Supply Chain
Innovation, from The Good Chain,
Fast Thinking Magazine, Spring 2011
Edition
Marks and Spencer’s Plan
A drive of 180 commitments to
tackle climate change, reduce
waste and use sustainable raw
materials saw a net benefit of
£105m – a 50% increase on the
£70m delivered in 2010/11.
The Guardian, M&S becomes
“carbon neutral”
“It’s not philanthropy,” was the blunt statement from Tyler Elm in 2008, Wal-Mart’s then Senior Director of
Corporate Strategy and Business Sustainability; the efforts made stem from self-interest. By the end of
the first year of Wal-Mart’s sustainability strategy the network teams had generated savings that were
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roughly equal to the profits generated by several Wal-Mart Supercenters.
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Stern Review: The economics of climate change
Brammer, Hoejmose, Millington, Managing Sustainable Global Supply Chains
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Stanford Social Innovation Review, The Greening of Wal-Mart
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4 | The Sustainable Supply Chain
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