The Importance of Supply Chain Sustainability
The availability and cost of imports mean millions of goods are shipped around the globe every day. This generates considerable carbon emissions, an issue which needs to be addressed. In addition, it distances retailers from suppliers, which can mean a lack of awareness about unethical production. These reasons highlight the importance of supply chain sustainability, but how is this achieved?
The Impact of Global Trade
There are around 58,000 cargo ships in the world and the average distance travelled by these vessels is 179,000 miles per year. Every day, multiple merchant ships arrive at docks across the world and huge operations are required to unload and distribute the containers.
The shipping industry never sleeps, as we continuously import and export goods. As a result, manufacturers, retailers and consumers have greater choice, but it comes at a cost. Unfortunately, high volumes of carbon emissions are released into the atmosphere by cargo ships. In fact, the shipping industry is responsible for 3% of the world’s carbon emissions**.
Aware that growing demand for global trade will drive this figure up, the industry is taking action. Through a range of measures, the International Maritime Organisation is committed to halving the environmental impact by 2050. One step is that new vessels are being built that reduce carbon emissions by 40%. However, more action is needed and one is the introduction of the Carbon Emissions Tax.
Carbon Emissions Tax
In October, the first carbon emissions tax was introduced in the EU. The aims are to encourage change through:
- Greater accountability on the climate impact of global trade
- Better mapping of the supply chain to increase transparency
- Improved awareness of suppliers, their practices and impact on workers, the community and the environment
- Enabling locally manufactured goods to compete on prices
- Encouraging the switch to sustainable suppliers
The UK and Japan are among the non-EU countries that are also putting in place measures to encourage supply chain sustainability and transparency.
How to Increase Supply Chain Sustainability
As consumers, we want companies to be proactive in becoming more sustainable. We want to make green choices and look to retailers to make that possible. Give us transparency, not greenwashing! It isn’t easy to make environmental decisions, especially when you aren’t aware of the whole picture.
Therefore, as a retailer, you need to take on responsibility for getting to know your supply chain. If there are options, make sustainable choices. This is easier to achieve when you:
- Limit the number of suppliers used and work to establish relationships with them and collaborate on data gathering.
- Use accredited suppliers, such as those with FSC® This provides evidence that their products and processes are independently audited.
- Opt for UK suppliers where possible, as this greatly cuts shipping emissions and makes it easier to visit and gain a fuller understanding of manufacturing practices.
Those local and ethical supplies include packaging. Yes, the unit price of packaging is often cheaper from suppliers in China compared to UK and EU manufacturers. However, factor in both the financial and environmental costs of shipping and local packaging manufacturers are competitive. In addition, you benefit from shorter lead times, more responsive customer service and greater flexibility.
As an FSC® certified packaging manufacturer, who is proactively working towards net zero the team at Aylesbury Box Company is here to help. From sourcing raw materials to minimising waste, our green credentials, we can help you evidence supply chain sustainability.
Contact our team on 01296 436888 or firstname.lastname@example.org to discuss your requirements and find out more about our ESG commitments.
Tracking the Supply Chain for the Full Environmental Picture
Gathering the necessary data to evidence supply chain sustainability is a challenge when you ship raw materials and components from across the globe. Fully understanding and recording data on the entire process requires detailed investigation.
As an example, electric vehicle batteries are often sourced from suppliers in China. Global buyers can check out the Environmental & Social Governance (ESG) of these companies, but that doesn’t tell the full picture. Nor does recording the carbon emissions of shipping batteries from China to Europe.
The cobalt and lithium needed for electric vehicle batteries are often mined in poor communities. Extracting these from the earth can be dangerous. What’s more, there has been evidence of unsafe conditions and exploitative labour, along with considerable air and water pollution in mining regions. When buyers are aware of such issues, they can visit suppliers and check conditions.
When tracking the supply chain sustainability, a fuller understanding of the environmental impact is realised. This transparency is necessary for producing goods that don’t cost the earth.
* Source: World Shipping Council