Sustainability and the Supply Chain

1. Sustainability and the
Supply Chain
Paul Tasner
Presented to:
Monterey Bay International Trade Association
“Streamlining Global Trade”
Palo Alto, California
July 17, 2014

2. The Plastic Pollution Problem
130,000,000 lbs CO2e9,000 TONS/DAY
1,700 PICKERS/DAY USA EXPORTS

3. 3 Phases of Sustainability
Phase 1: Getting the basics right.
This is the basic level and the phase in which the majority
of organizations reside. Companies employ simple
measures such as switching lights and computers off
when left idle, recycling paper, and using greener forms
of travel with the purpose of reducing the day-to-day
carbon footprint. Some companies also employ self-
service technologies such as centralized procurement
and teleconferencing.

4. 3 Phases of Sustainability
Phase 2: Learning to think sustainably.
This is the level where companies begin to realize the
need to embed sustainability into supply chain
operations. Companies tend to achieve this level when
they assess their impact across a local range of
operations. In terms of the supply chain, this could
involve supplier management, product design,
manufacturing rationalization, and distribution
optimization.

5. 3 Phases of Sustainability
Phase 3: The science of sustainability.
The third level of Supply Chain Sustainability uses auditing and
benchmarks to provide a framework for governing
sustainable supply chain operations. This gives clarity to the
environmental impact of adjustments to supply chain agility,
flexibility, and cost in the supply chain network. Moving
toward this level means being driven by the current climate
(in which companies recognize the significance of cost
savings through green operations) as well as pushing
emerging regulations and standards at both an industry and
governmental level.

6. Implementation Overview
 Establish standard procedures and codes of conduct
(set the ground rules)
 Increase quality of communications/reporting
(make it easier)
 Encourage and support cross-functional collaboration
(marketing, legal and procurement)
 Engage and manage supplier and stakeholder
(community) relationships

7. Core Idea
Value
Chain
Adding
Value
Creating
Value

8. Shift Focus
Labor
Productivity
Improving
RESOURCE
Productivity
Examples:
 Water usage
 Energy-efficient buildings
 Recycling (reclaiming/repurposing)

9. Strategies for Implementation
 Starbucks Fair Trade best
practices
 Home Depot FSC wood
 Walmart Sustainability
Index/Consortium
EXAMPLES

10. Engage Suppliers
• Choose and set strategic targets and
metrics in absolute or intensity terms
(e.g., reduction in GHG’s)
• Engage suppliers in the big goals and
gain input on best rollout mechanics
• Collect supply chain sustainability
information
 Supplier scorecards
 RFPs
 Procurement data systems

11. Engaging Suppliers
• Provide training to Suppliers during phase-in and
again when new requirements are initiated (RP
policy, practices)
• With regards to information tracking: look for patterns,
improvement
• Partner to offer suggestions, incentives & recognition

12. “Make vs. Buy”
A business whose supply chain is
dominated by 3rd party relationships
has a significantly greater challenge
effecting change than a business
that controls their own means of
supply.

13. Transportation Carbon
Comparison
Air 8X
Road 1X
Rail 4X
Sea 8X

14. SmartWay® Transport
Partnership
The SmartWay® Transport Partnership is an
innovative collaboration between the U.S. EPA
and the freight industry to increase energy
efficiency while significantly reducing
greenhouse gases and air pollution.

15. Fuel Consumption &
Emissions
Technologies and strategies for reduction:
• Idle Reduction
• Improved Aerodynamics
• Improved Freight Logistics (the left turn!)
• Automatic Tire Inflation Systems
• Wide-base Tires
• Driver Training
• Low-Viscosity Lubricants
• Weight Reduction
• Intermodal Shipping
• Hybrid Powertrain Technology

16. “Greensourcing”
The goal of this program is simple: to identify and
ultimately improve the environmental and social impacts of
the business with the supplier.
The first step of the program is to integrate
the reporting of key sustainability metrics
and issues into the ongoing client-vendor
relationship. Through this, one gets a
baseline understanding of the joint
environmental footprint, and, very
importantly, allows sustainability to become
an added dimension of current practices.

17. “YOU CAN’T FIX
WHAT YOU DON’T
MEASURE.”

18. Why We Want to Work With You
• your footprint is our footprint
• you are the expert – you know your business best
• you’ve made a commitment to our business
• both businesses will benefit from these steps
• there are many advantages to making sustainability
one of your business’s priorities:
 energy + material cost savings,
 ability to attract new business, and
 steps to get ahead as businesses start to address
sustainability.

19. What We Expect From You
• COMMITMENT. To examine and record your
business’s environmental impacts.
• REPORTING. On the metrics that have been
established.
• EXECUTION. Setting and completing goals to
improve our joint environmental footprint.
• REPETITION. We ask that you repeat this
process with your key vendors.
• TRANSPARENCY. We are looking for areas
to improve, and we reward honesty in
identifying these.

20. What You Can Expect From Us
• COMMITMENT. This added dimension to our business
relationship strengthens the link and increases its
unique capacities.
• SUPPORT. Our teams are resources for identifying and
introducing environmental best practices to your
business, ultimately helping to make sustainability a
core competency for you.
• INCENTIVES. We are happy to reinforce positive
change either in direct financial terms (such as the
carbon reduction incentive) or with longer-term contracts
for our business.
• COMMUNICATION. We commit to tell the story of the
successes of this program broadly.

21. • WATER
• ENERGY
• MATERIALS
OBJECTIVES: what is the ultimate goal?
STRATEGY: how do we want to get there?
BEST PRACTICES: examples of meaningful
environmental innovations.
METRICS: how do we track progress?
How It Works

22. THANK YOU
Paul Tasner, Co-founder & CEO
PulpWorks, Inc.
Renaissance Center
1115 Third Street, Suite 2
San Rafael, CA 94901