A Greener Supply Chain

Tags: Green Logistics, Supply Chain, Sustainability

Much has been written about the recent US-based Business Roundtable event, where 181 CEOs announced their commitment “to lead for the benefit of all stakeholders,” not just shareholders. The implications will ripple through boardrooms around the country, as the event redefined the purpose of a corporation as one that serves — equally — shareholders, communities and suppliers, among others. As expressed by attendees, this means that traditional practices must be measured against the impact on others, with corporate social responsibility elevated to executive decision making (and not simply promoted in one’s press release materials).

The announcement coincides with a global corporate shift towards sustainable transportation practices. While most maintain that reducing carbon emissions is the responsibility of all corporate citizens (as well as private), it should be noted that the socially responsible move also makes — in many instances — sound economic sense.

Anheuser-Busch announced earlier this year that it had purchased 800 fuel cell trucks, with the truck’s manufacturer, Nikola, promising to build more than two dozen fueling stations along AB’s travel routes.

"Once fully implemented, the carbon reductions gained from these 800 trucks will reduce the brewer’s carbon emissions from logistics by more than 18 percent—equivalent to taking more than 13 thousand passenger vehicles off the road annually," Anheuser-Busch wrote in a press release announcing its purchasing commitment.

At the same time, the company will pay no more to operate the trucks than they do for today’s diesel trucks, making the emissions savings a no-brainer for the company. “My generation is tired of emissions,” said Nikola CEO Trevor Milton. “…They want things that solve the environmental impact problem.”

But even incremental shifts — not overhauls to zero emission technology — are making a difference. Advanced biodiesel fuels in diesel engines can reduce greenhouse gas emissions by at least half (and up to 80% if renewable diesel fuels are used) without any vehicle modifications needed. A recent study by the North American Council for Freight Efficiency revealed that these new technologies can elevate Class 8 diesel trucks to achieve in excess of 12mpg, a remarkable efficiency that reduces emissions while also supporting one’s bottom-line on fuel costs.

These are savings that are not just hypothetical but ones that are being realized in corporate boardrooms around the world. Last year, 115 of the world’s largest companies sought environmental impact information from more than 5,000 suppliers, part of the CDP’s Supply Chain Disclosure program. Collectively, those suppliers reported the reduction of 633 million metric tons of carbon dioxide emissions, savings that also trimmed $19.3 billion in supply chain costs.

The process does not come by chance; rather, companies looking to make profound changes must make the commitment a top-down directive that encourages the entire enterprise to ask probing questions and actively support efforts to make their supply chain more environmentally friendly.

Each of us, in our own way, can make a difference.

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