Sustainable Practices That Support the Global Supply Chain

For creating a cleaner and more just world, supply chain management plays a crucial role. The World Economic Forum (WEF) reports that the supply chains of just eight industries make up over half the world’s carbon emissions.

By adopting sustainable supply chain management practices, the WEF finds, those industries could slash their emissions by at least 40%, with no added costs to consumers.

That’s why eight in 10 corporate executives are ramping up their sustainable supply chain activities, according to a 2022 EY survey.

But what do those activities look like? A number of practices exist for creating more sustainable supply chains. A degree program in supply chain management can prepare workers to take part in creating them.

What Is a Sustainable Supply Chain?

A common definition of sustainability is the ability to meet present-day needs without compromising the abilities of future generations to meet their needs. Sustainability focuses on three kinds of responsibility.

Environmental: Reducing impact on the environment, such as cutting emissions, using renewable energy and recycling waste
Social: Promoting human rights and ethical labor practices, such as providing safe workplaces and fair wages
Financial: Ensuring that programs are financially sustainable by managing operating costs, minimizing risks of major losses and helping comply with regulations

Those goals can be applied to any of the links in a supply chain, from the beginning to the end of a product’s life cycle.

What Are Challenges for Sustainable Supply Chains?

Sustainability may sound promising in concept, but implementing it in supply chains isn’t always easy. They can be long and complicated, posing various challenges to achieving sustainable change.

Reducing Waste

Wasteful processes cost companies and consumers money while adding to solid waste in landfills.

Wasted inventory amounts to $163 billion a year globally, according to a survey by Avery Dennison, the maker of adhesive labels and functional materials.
Food waste accounts for 8% of global greenhouse gas emissions, reports McKinsey & Company.

Reducing Emissions

To reduce the release of greenhouse gasses and hazardous chemicals, companies have to look beyond their own immediate operations. CDP, an organization that helps businesses with environmental reporting, finds that suppliers produce 11 times more emissions than companies’ own operations.

Ensuring Supplier Compliance

To meet their sustainability goals, companies need to set standards for suppliers, screen for suppliers who are able to meet them and ensure compliance.

Tracking Progress

To ensure that suppliers are meeting standards, companies must devise methods to monitor them; their methods include audits and electronic sensors.

What Are Solutions for Sustainable Supply Chains?

Although sustainable supply chains can present daunting challenges, companies are using a wide range of innovative practices to overcome them.

Supplier Codes of Conduct

Sustainable companies lay out specific supplier standards in codes of conduct. The global agribusiness leader Cargill, for example, includes the following:

Labor protections, fair wages and a human rights policy
Standards for reducing greenhouse gas emissions, waste and water use
Environmental policies on fiber packaging, palm oil, forests and animal welfare

Life Cycle Assessments

To analyze the impacts of each link in a supply chain, companies conduct product life cycle assessments. Those assessments include steps before and after manufacturing.

Mining, harvesting, and procuring materials
Transporting and distributing
Marketing, retailing and usage by consumers
Recycling or disposing of waste

Internet of Things Monitoring

The Internet of Things (IoT) lets companies measure supplier compliance in real time by using sensors connected to the internet. Various kinds of sensors can promote various aspects of sustainability.

Gas sensors can ensure that emissions controls are working.
Temperature and humidity sensors can prevent perishable food waste.
GPS sensors can track routes and locations of delivery vehicles.

Sustainable Transportation

Transportation makes up 28% of all U.S. greenhouse gas emissions, according to the U.S. Environmental Protection Agency (EPA). Companies are using a variety of strategies to reduce them. Below are a few examples:

Energy-efficient and all-electric vehicles
Alternative fuels, such as biodiesel and ethanol made from agricultural waste
Computerized fleet management to make routes more efficient and reduce miles driven

What Are Careers in Sustainable Supply Chains?

Sustainable supply chains offer positions in a wide variety of industries and employers, from manufacturing and trade to government. According to the U.S. Bureau of Labor Statistics (BLS), all of them offer above-average wages and job growth, and most require at least a bachelor’s degree.

Supply Chain Manager

A supply chain manager coordinates all aspects of a company’s supply chain, from recruiting suppliers to distributing finished products. Much of the work is managing relationships among the players in this complex network.

According to the BLS, as of May 2024, supply chain managers earned a median annual salary of $99,200; the average was $48,060 for all occupations. Jobs were projected to grow by 8% from 2022 to 2032, compared with 3% for all occupations.

Logistician

Logisticians manage the transport of materials and goods. They ensure that parts arrive at the right time, that products get to stores and that costs are controlled along the way.

The average annual salary for logicians was $79,400 in May 2024, the BLS reports. The bureau forecasts 10-year job growth of 18%.

Purchasing Manager

A purchasing manager oversees the purchasing of both raw materials and parts. Their responsibilities include finding suppliers, negotiating contracts and prices, and product quality control. A purchasing manager may oversee the work of multiple purchasing agents.

The average annual salary of purchasing managers was $136,380 in 2024, according to the BLS. The bureau expects job openings to increase by 4% over the coming decade.

Explore a Career in Supply Chain Management

With increasing concerns about environmental and social impacts of business, supply chain management offers practical ways to create a more sustainable future. A degree program such as the Bachelor of Science in Business Administration (BSBA) in Supply Chain Management at Appalachian State University can prepare students to become professionals in the field.

The program covers all aspects of supply chains — procurement, sourcing, logistics, manufacturing, distribution and quality management — while allowing students to interact with experts and earn certifications. Learn more about how such a program can lead to a career in sustainable supply chain management.

Sources:

Bloomberg, “Oversupply, Damage Sees $163 Billion in Inventory Tossed Annually”

Cargill, Supplier Code of Conduct

CDP, Scoping Out: Tracking Nature Across the Supply Chain

EY, “How Sustainable Supply Chains Are Driving Business Transformation”

GEP, Supply Chain Sustainability

Harvard Business Review, “A More Sustainable Supply Chain”

IBM, “What Is Sustainable Supply Chain Management?”

Infosys BPM, Green Transportation: Driving Logistics on a Sustainable Track

Internet of Things, “IoT-Based Supply Chain Management: A Systematic Literature Review”

KPMG, Life Cycle Assessment Guide

McKinsey & Company, “Reducing Food Loss: What Grocery Retailers and Manufacturers Can Do”