As climate concerns grow, companies are shifting their supply chain priorities from speed and cost to long-term sustainability. The urgency is clear: An estimated 40 percent of supply chain emissions could be reduced through accessible, cost-effective strategies, according to the World Economic Forum.
For future business leaders, understanding how to design and manage more sustainable supply chains is quickly becoming essential. Below are key strategies and trends every aspiring supply chain manager should know.
Sustainable Supply Chain Management (SSCM) is the practice of integrating environmental and social considerations into the sourcing, production, and distribution of goods. It aims to incorporate sustainability principles into each stage of the supply chain, from strategic planning to product delivery.
The goal? To minimize a company’s negative impact on the environment while ensuring efficiency and a strong bottom line.
By building sustainable supply chains, companies can drastically reduce their greenhouse gas emissions (GhG), the primary pollutant of supply chains. Globally, supply chains account for more than 80 percent of GhG, as well as 90 percent of negative impacts on air, land, and water resources.
SSCM also provides meaningful business benefits, including enhanced profitability and brand image. Sustainable supply chains reduce waste, minimize energy output, and improve efficiencies—all activities that reduce production costs.
Companies that use SSCM also improve their reputation and trust with stakeholders. This can help differentiate their brand in the marketplace, which directly influences sales.
To implement SSCM effectively, companies must collaborate closely with suppliers, manufacturers, and procurement teams at every stage of the supply chain. They should also evaluate their practices using the environmental, social, and governance (ESG) framework.