Adams - Greening Your Supply Chain

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"Why? Drivers for Greening the Supply Chain" - from 8/18 Business & Environment Session, Greening the Supply Chain: Drivers, Challenges and Strategies

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  • Yellow arrows are equivalent to risk – loss of control of materials and exposureMULTIPLE LAYERS OF SUPPLY CHAIN UPSTREAM AND DOWN
  • Yellow arrows are equivalent to risk – loss of control of materials and exposureMULTIPLE LAYERS OF SUPPLY CHAIN UPSTREAM AND DOWN
  • Pollution preventionResource scarcities political issues conflict mineralsYour products are someone else’s inputs
  • Toxic materials management, haz waste, air & water permitsMistakes – fines, liabilitiesHarm to env or workers, customers
  • Green dominoes – need to keep up with competition greener than the next guyBrand and performance – investors and maybe consumer market. Certifications.
  • Supply Chain Environmentalism In the retailer community there is sound evidence that Supply Chain Environmentalism has become a reality and, perhaps, a market imperative. Supply chain environmentalism is defined as the enhancement of competitiveness of products through either cost reduction or product differentiation, or both, achieved by reduction of environmental impacts (e.g. greenhouse gas emissions, water consumption, etc.) in the supply chain. ENVIANCE
  • Suppliers viewed as biggest env impact – you meet Walmart goals for GHG reductionCarbon Disclosure Project (CDP)Greenhouse gas emissionSolid waste generatedWater useSustainability purchasing guidelines for your direct suppliers3rd party product certificationsLocation of ALL facilities that make your productsQuality pre-check suppliersManage “social compliance” for you and your suppliersCommunity development activities
  • Another: Kaiser http://www.greenbiz.com/news/2010/05/04/kaiser-applies-new-green-scorecard-medical-supply-chainP&G scorecard http://www.pg.com/en_US/news_views/blog_posts/2010/may/sustainability_scorecard.shtml
  • Sony “Road to Zero” program are based on four environmental perspectives: climate change, resource conservation, control of chemical substances and biodiversity and six product lifecycle stages: business operations, take back and recycling, Research and development, product planning and design, distribution and procurement. Develop and refine “3R” (Reduce,Reuse,Recycle) technologies that reduce the use of nonrenewable resources and water and the generation of waste throughout product life cycles
  • Coke, best Buy, aveda, Ford, GM, General Mills, nike, Dell
  • Green dominoes – need to keep up with competition greener than the next guy
  • Pacific Northwest Pollution Prevention Resource Center
  • Adams - Greening Your Supply Chain

    1. 1. Greening Your Supply Chain<br />Georjean L. Adams <br />EHS Strategies, Inc.<br />Environmental Initiative BES<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    2. 2. Ideal Supply Chain Life Cycle<br />Make<br />Use<br />Supply<br />Recycle<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    3. 3. Real Life<br />Emissions, discharges<br />and exposures<br />Make<br />Raw Materials <br />and Energy use<br />LIFE CYCLE<br /> IMPACTS<br />Supply<br />Use<br />Recycle<br />Inefficient yield<br />and transfer<br />Safety and toxicity<br />hazard<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    4. 4. Why Green Your Supply Chain?<br />dollar savings through energy, materials and waste reduction<br />avoid regulatory costs and liabilities <br />enhanced reputation - brand and employee loyalty<br />customer demand for environmentally preferred/green<br />Reduced impact on the environment<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    5. 5. Real Life<br />$<br />Emissions, discharges<br />and exposures<br />Make<br />$<br />Raw Materials <br />and Energy use<br />LIFE CYCLE<br /> IMPACTS<br />$<br />$<br />Supply<br />Use<br />Recycle<br />Inefficient yield<br />and transfer<br />Safety and toxicity<br />hazard<br />$<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    6. 6. Inputs Outputs<br />Energy<br />Product<br />Raw Materials<br />Emissions<br />Solid & Liquid wastes<br />Wastewater<br />waste<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    7. 7. Green Inputs Green Outputs<br />energy<br />product<br />RAW MATERIALS<br />wastes<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    8. 8. Greener Resources<br />Renewable<br />Low “embedded” energy<br />Low GHG/carbon footprint<br />Low toxicity<br />Biodegradable<br />Recycled content<br />Recyclable<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    9. 9. Green and Lean<br />Reduce Inputs/Waste<br />Recycle/Reuse Wastes<br />energy<br />PRODUCTS<br />Raw materials<br />Wastes<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    10. 10. Lean Suppliers = Greener Suppliers<br /><ul><li>Overproduction
    11. 11. Inventory
    12. 12. Transportation
    13. 13. Defects
    14. 14. Over processing
    15. 15. Waiting
    16. 16. Energy [GHG, nonrenewable fuels]
    17. 17. Materials and water consumption
    18. 18. Waste - hazardous and solid
    19. 19. Air pollution
    20. 20. Water pollution</li></ul>8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    21. 21. Why Green Your Supply Chain?<br />dollar savings through energy, materials and waste reduction<br />avoid regulatory costs and liabilities <br />enhanced reputation - brand and employee loyalty<br />customer demand for environmentally preferred/green<br />reduced impact on the environment<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    22. 22. Why Green Your Supply Chain?<br />dollar savings through energy, materials and waste reduction<br />avoid regulatory costs and liabilities <br />enhanced reputation - brand and employee loyalty<br />customer demand for environmentally preferred/green<br />reduced impact on the environment<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    23. 23. 8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    24. 24. Why Green Your Supply Chain?<br />dollar savings through energy, materials and waste reduction<br />avoid regulatory costs and liabilities <br />enhanced reputation - brand and employee loyalty<br />customer demand for environmentally preferred/green products (esp. B2B)<br />Reduced impact on the environment<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    25. 25. Customers Want to be Green<br />B2B, Government and Consumers<br />Environmentally preferred purchasing<br />Bio-based<br />Renewable<br />Recycled content<br />Recyclable<br />Low energy<br />Less toxic<br />Reduced packaging<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    26. 26. B2B Demands for Information<br />Regulatory Compliance Declarations<br />RoHS, REACH SVHC<br />Inventories<br />Conflict Minerals<br />Customer Black Lists<br />Regulatory + company “hit” list<br />OEM data bases – IMDS (auto), BOMcheck (electronics)<br />Full Material Declaration<br />Rapid response to new listings<br />Life cycle assessment<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    27. 27. Sustainability Index<br />Energy and Climate: Reducing Energy Costs and Greenhouse Gas Emissions <br />Material Efficiency: Reducing Waste and Enhancing Quality, Packaging<br />Natural Resources: Responsibly Sourced Raw Materials<br />People and Community: Ensuring Responsible and Ethical Production<br />Sustainability Consortium with 30 other firms <br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    28. 28. Sustainable Apparel Coalition <br />http://www.apparelcoalition.org/http://ecoindexbeta.org/<br />Adidas …Environmental Defense Fund…Gap Inc., HanesBrands…JC Penney, Kohl’s Department Stores… Levi Strauss & Co… L.L.Bean, Marks & Spencer … Nike, Nordstroms… Patagonia… PUMA, REI … Target, Timberland, USA DuPont, EPA … Walmart<br />Engage upstream suppliers to collect data for index<br />Minimal level of specified best practices<br />Share best practices to improve whole industry supply chain<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    29. 29. Supplier Scorecard<br />Energy Usage – electric, fuel, renewable<br />Water Usage – input/withdrawal, output/discharge<br />Waste Disposal – hazardous and nonhazardous, recycled<br />Kyoto gases – direct and indirect<br />Annual output used to calculate intensity of above<br />P&G Sustainability Ideas & Initiatives<br />Fines & Sanctions<br />Environmental Management System<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    30. 30. Kaiser Permanente Supplier Scorecard<br />Corporate: sustainable policy, reporting, ISO, local food, waste, recycling, GHG, EPEAT, Energy Star, materials composition<br />SKU: BPA, RoHS, halogens, phthalates, Prop 65, antimicrobials, hazardous waste, reusable, recycled content, composition<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    31. 31. Life cycle assessment of their products<br />Cradle to cradle<br />two-hour tour of suppliers' facilities<br />documentation of the supplier's environmental policies and performance<br />follow-up done every 12 to 18 months <br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    32. 32. Suppliers shall commit to reducing the environmental impact of their designs, manufacturing processes, and waste emissions.<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    33. 33. Roadmap to Sustainability:<br />Companies will ensure that suppliers meet the same environmental and social standards as the company has set for its internal operations<br />- including disclosure of goals and performance metrics <br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    34. 34. Why Green Your Supply Chain?<br />dollar savings through energy, materials and waste reduction<br />avoid regulatory costs and liabilities <br />customer demand for environmentally preferred/green<br />enhanced reputation - brand and employee loyalty<br />reduced impact on the environment <br /> Sustainability (green + economics + social)<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    35. 35. 8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    36. 36. Ask Yourself<br />Do you understand the environmental/health impacts associated with your products throughout their life cycle? <br />Who your suppliers are?<br />What is in your raw materials and products?<br />What happens downstream - distributors, users and disposal? <br />What do your customers want?<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    37. 37. Benchmark<br />Standards: Global Reporting Initiative, ISO 14000, Ceres, Natural Step, Responsible Care<br />Relevant business leadership groups<br />Identify your strengths and weaknesses<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />
    38. 38. Communicate with Supply Chain<br />Develop shared goals and targets<br />Measure<br />Evaluate and improve<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />Get comfortable with TRANSPARENCY<br />
    39. 39. Resources<br />Case Studies: http://www.pprc.org/pubs/grnchain/casestud.cfm<br />Green Suppliers Network: http://www.greensuppliers.gov/<br />EPA Lean: http://epa.gov/lean<br />MnTAP: http://www.mntap.umn.edu<br />Network for Business Sustainability http://nbs.net/knowledge/supply-chain/<br />http://Ehsstrategies.com<br />8/18/2011<br />©2011 EHS Strategies, Inc.<br />

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