It’s the Year of the Rabbit, the UN’s International Year of Millets (google that) and, by popular demand of our thinkstep-anz team, the Year of the Supply Chain. Or, as we prefer to call it, the Year of the Supply Web. (Supply arrangements are complex and connect on many levels. They’re more like a spider’s web than a daisy chain.)
Why are we big on supply webs? It’s because delving into the relationships that make up your supply web is one of the fastest ways to make sustainable progress – especially to reduce your greenhouse gas emissions. Modern supply webs are a ‘spaghetti’ of relationships. Buy a low-carbon service and you reduce your emissions. Redesign your products to reduce their carbon footprint and you cut your customers’ emissions too.
Supply webs and the global picture
Global sustainability organisations like the United Nations (UN), the World Resources Institute (WRI) and World Business Council for Sustainable Development (WBCSD) know that supply chains and sustainability go hand-in-hand.
The UN has given supply chains their own Sustainable Development Goal. SDG 12 champions Responsible Consumption and Production. It supports many other goals in the SDG framework, including SDG 13: Climate Action.
The UN knows, too, that organisations need to work together to take sustainable action through their supply chains. So, let’s give a shout-out to SDG 17 too – Partnerships for the Goals.
The WRI and WBCSD’s global Greenhouse Gas (GHG) Protocol includes a stream of work (Scope 3 carbon emissions) dedicated to reducing emissions in supply chains. The GHG Protocol is one of the ‘bibles’ that sets the rules for measuring and reducing greenhouse gases.
Supply webs and trans-Tasman businesses
Looking inside our own business here at thinkstep-anz reveals that most of the services we offer help our clients on both sides of the Tasman focus on their supply chains (or their customers’ supply chains). For example, we’ve helped:
- Trans-Tasman manufacturer Essity (formerly Asaleo Care) to measure and communicate the environmental footprint of the tissue products they sell.
- New Zealand food producer Meadow Mushrooms to understand the carbon footprints of different options for packaging their mushrooms.
- New Zealand grocery retailer Countdown to measure emissions in their supply chain, including electricity and transport, and to reduce them
- the Green Building Councils on both sides of the Tasman to encourage investors, architects and construction companies to demand, design and build properties using products low in embodied carbon. (That’s the carbon ‘hidden’ in building products.)
- Australian manufacturer Eagle Lighting to develop a responsible procurement framework to buy products and services made in environmentally and socially sustainable ways.
Ten supply web tips to kick off 2023
1. Value your supplier relationships
You’re not on your own. Work together to reduce your emissions. This is SDG 17: partnerships for the goals.
2. Measure
‘What gets measured gets managed.’ It’s an old adage, but true for all that. Use data to measure your starting point, set a target and chart your progress.
3. Focus on what matters
You can’t do it all. Focus on the environmental impacts that are material (significant in size) and most relevant to your business.
If you manufacture a product, tools like Life Cycle Assessment (LCA) will help you identify your environmental ‘hot spots’. These are the activities or inputs that have the greatest environmental impacts. Are they your raw materials? Or the transport that delivers them to your factory?
If you want to tackle your organisation’s carbon footprint, our free thinkstep-anz Scope 3 Explorer will help you understand where to focus.
4. Communicate with your suppliers
Create a responsible procurement policy that sets out your ambitions for a more sustainable supply chain. Tell your suppliers what you expect them to do (and not do) to meet your social, environmental and governance standards.
5. Seek proof
Look for reputable, third-party evidence about the products and services you buy. If you’re buying a product, Environmental Product Declarations (EPDs) contain verified data. Cradle to Cradle® Certification (C2C) confirms that products are circular, safe and responsibly made.
Then check out the company behind the product. For example, carbon certifications with Climate Active (Australia) and Ekos and Toitū (New Zealand) show the company is meeting globally recognised standards.
6. Adapt, don’t replace
Burning supply relationships creates risk for your organisation. Instead, adapt your existing procurement system to show suppliers that you care about more than price. And get your own house in order first. Could you pack more product into each shipment before you switch transport supplier?
7. Boost your influence
Your suppliers have suppliers who have suppliers. Help them understand their own environmental and social footprints. Encourage them to share this information across their supply web too. Responsible procurement is contagious (in a good way!)
8. Train your team
Help your procurement and sales teams talk about sustainability. For example, if you’re a manufacturer, explain how EPDs work. Help your team show customers how to use the environmental information they contain.
9. Remember that sustainability is about people
Some organisations support modern slavery without realising it – through their supply chains. Modern slavery is a serious global issue that breaches human rights. Make sure you’re not inadvertently bankrolling it in the goods and services you buy.
10. Be patient
Good things take time. (Including becoming more sustainable!)
January 2023