sustainabiity(2)

8/10/2019 sustainabiity(2)

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Sustaina

V

bility in Supplyhain

BY

ERNIKA AGARWAL


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us a na e

Abukhader and Jonson ( regar ng og s cs an s

1. What is the im

2. What is the im

og s cs an upp y

2004) posed two important questionspp y c a n an na ura env ronmen :

pact of logistics on environment?

pact of environment on logistics?


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Impact of logistics on enby using carbon assessm

For example: Cotton

Canada.

Thus because of that sowarehousing is required tmarkets.

Chainironment can be easily conceptualizednt.

.

e form of lo istics activities such aso bring cotton/ cotton products to these


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Seuring and Muller (2008) dmana ement as:

The m a na e m e nt o m a te

c o o p e ra t io n a m o ng c o m p g o a ls fro m a ll t h re e d im

,fro m c u sto m e r a nd sta ke ho

fined sustainable supply chain

ria l in fo rm a tio n a nd c a ita l flo w s a s w e ll a

a n ie s a lo ng th e sup p ly c h a in w h ile ta king nsio ns o f susta ina b le d e ve lo p m e nt , i.e .

,ld e re q u ire m e n ts.


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r p e

The triple bottom line (abbrevknown as " people, planet, pro

measuring organizational (anecological and social.

om ne

ated as "TBL" or "3BL ", and alsofit " or "the three pillars")

societal) success: economic,


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us a na

The achievement of sustain s mp e con ons:

The worlds current use o

constraints their standardThe management of pladegradation that makesgenerations to match ouour h sical surroundin s

y n upp y a n

bility requires us to meet two deceptively

minerals, fuels and the products of the soil

of living below us.et must avoid pollution, disruption or

it sustainably more difficult for futurer material prosperity, health or pleasure in.


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ey e r

1. Ener consum

2. Water consumpti

3. Greenhouse as

4. Waste generatio

s or us a na y

ion

on

emissions


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Sustainable developmen

the present without com u ure. ar rom requ r ng

recognizes that the problcannot be solved unless

developing countries pla

ur ommon u ure,

The Brundtland Commission

(UN World Commission on Environment &

seeks to meet the needs and aspirations o

romising the ability to meet those of thee cessa on o econom c grow ,

ms of poverty and underdevelopmente have a new era of growth in which the

a large role and reap large benefits.

evelopment)


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us a na

Industry Sector

Power & Energy

Mining

etro eum an Refinery

y n a or n an

List of Companies1.TATA power2. Reliance Power

1. Coal India Limited2. Hindalco

.

2. BPCL

1. ITC 2. Rallis India Ltd.


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Industries Ma or SustainablAutomotive Efficient Supply Ch

vehicles Green Infr and energy usage iprocess Provision ofalternative sources

planting at IT camptechnologies Focus

an ng n erne an o ethe usage of paper

loan rates for the p

Retail Eco friendly producGreen Buildings Altmanagement

Initiatives

in Management Development of innovative fuel efficstructure for offices and factories Conservation of w

n the processes Optimization of material managemen employee buses to reduce carbon foot print Utilizatio

f energy

,

uses Reduction of travel using innovative communicat on reduction of paper in the offices

an ng an e n ro uc on o ac y as re uc Innovative product offerings provision of preferential

rchase of hybrid vehicles and construction of LEED de

ts and packaging Eco friendly sourcing Recycling initirnative Energy sources Energy, water and waste


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o a e

sustainability field. GRI prom

for organizations to becom .

GRIs Sustainability Reportinall companies and organizaunderstand and communic

GRI's mission is to make sustone which hel s to romotglobal economy.

GRI is an international not-f

guidance and support to or

Source: https://www.globalreporting/Pages/default.as

or ng n a veotes the use of sustainability reporting as a way

more sustainable and contribute to

Framework is a reporting system that enablestions to measure,te this information.

inability reporting standard practice;and mana e chan e towards a sustainable

r profit-organization based in Amsterdam. Its

ganizations.

reporting.org/information/sustainability- x


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Sustainabilit RTren

The National Voluntary Guidelines onSocial, Environmental and EconomicResponsibilities of Business (NVGs) release

by the Indian Ministry of Corporate Affairs

sustainability and inclusiveness into corebusiness practice.

launched GREENEX at Bombay stockexchange in India is introduced to assessenergy efficiency performance ofcompanies.

There are around 80 Indian companiesfrom various sectors that have beenreporting, and there are about 60companies, who publicly declare thatthey follow the GRI Guidelines on almost

,

social and governance performance,although the rigour and details vary.

ortin Practices &s in India


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overnmen nThe Companies Bill, 2012.The Lok Sabha (Lower Housethe Companies Bill. The Actspen on ac v es re a e o

DPE Guidelines on CSR and S e annua emoran um o

Sector Enterprises (CPSEs) andobjectives for a CPSE, in whicSustainable Development.

Annual environmental audit

Reporting in the environment an raw ma er a consumpprescribed standards), quantiwastes, impact of pollution cresources and the cost of pro

.

a ves n n a

f Indian Parliament) in December 2012 passedakes it mandatory for profit-making companies to

.

stainability, 2013. n ers an ng o e ween en ra u c

Government Ministries defines the targets anda fixed percentage is defined for CSR and

eport.

l statement includes parameters such as watern, po u on genera e a ong w var a ons romties and characteristics of hazardous and solidntrol measures on the conservation of natural

duction, and additional investment proposals for


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overnmen nCorporate Responsibility for

A charter promoted by theinitiative aims to o be ond prevention and control of pwaste minimization, in-plantechnolo ies in environmen

large businesses in the 17 hiNational Voluntary Guidelin

,

The Indian Ministry of Corpo

Guidelines on Social, Enviro us nesses are encourageprovisions articulated in theaddressed across the value

a ves n n a Environmental Protection (CREP), 2003.

Central Pollution Control Board of India, thiscom liance with re ulator norms for

ollution, through various measures includingprocess control, and adoption of clean

tally-intensive industries. CREP is mandatory for

hest polluting sectors in India.s on Social, Environmental & Economic

.

ate Affairs launched the National Voluntary

mental & Economic Responsibilities of Business.o move eyon e recommen e m n mumdocument and to ensure CSR issues arechain.


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as c u py an


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ere can we c eve us a na y


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Pr

curement


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n

The idea that it is not the pr perspective to the inclusionservice providers.

In an organization aiming fgiven a crucial role in reduccontrol emissions stemming

ro uc on

ducts competing with each other but supply-of suppliers, sub-suppliers, customers and

r sustainability, the procurement activities areing the environmental footprint as they mainlyfrom the upstream suppliers.


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us a na

Sustainable purchasing is all abfactors into account in purcha

w a your pro uc s are ma ehas made them

While Green procurement is aimed at ensuring pr

waste reduction, reuse and recycling.

e rocuremen

ut taking environmental and socialing decisions. Its about looking at

, w ere ey come rom an w o

ducts or materials meet environmental objectives e.g.


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us a na

Sustainable procurement wperspective

Social injustice (for exampleviolation of the basic humato incorporate sustainable

e rocuremen

s and is often initiated from an ethnical

the situation of the coffee farmers) and therights (child labour) triggered consumer reactiractices.


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To simplify the selection of sup environmental certifications ar

1. Fairtrade

2. Marine stewardship coun3. Rainforest alliance

4. Carbon trust

5. LEED

6. ISO 14001

co a es

liers, certifications or ecolabels of external and.:

il


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Supply Cha

Storage Facilities

Coffee GrowersVendors

Re

n of Starbucks

Roasting PlantsWarehouses

Distribution Center

tailers RetailersRetailers


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Operations:Equatorial BeltHi h ualit aSend dried bea

Storage facilitie

GPS tracking d

d service

rowers

s by shipStora e Facilities

s

vicesp


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Operations:

More than 40,

Inventory:

Sends to Distr

Center

b

truc

Vendors

00 suppliers

bution

Truck


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oas ng

Major

Operations n , n

Roast, de stone

Packaging:Automated

Palletizing s Inventor :

Store palletized

n s are ouses

s er am taste profile

Roasting Plants

oxinstems Warehouses

caf in warehouseTruck


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Operations:oca e reg ona y 24 hours / 5.5 days a week Outsources distribution to 3PL

Inventory: Push/Pull boundaryr er supp es rom ven ors

Hold packaged products and mercha

Information

Technolo HighJump Software s Supply Chain E

Streamline Product Distribution

Distribution Center

Warehouses

diseRetailers

ecution Solution to

ruc


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Operations More than 10,500 Stores locat Company owned and license Standardized re ulations

Relationship

ManagementInventory

Periodic Review Coffee, milk and paper prod

Food

products:

Four

times

a

Information Technolo Computers information syste

e a ers

d globally e a ers

Truck

cts: Once per week

eeky

s


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Focus

on

high

quality

and

ser Pays premium prices

Preferred customer

ice


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rocurem

Long

term

relationships Mutually beneficial

Relationship management

an mra

St

en : e a ons ps

osin a vendor is like losin employee you lose the ney and time you put into n ng em, o n am n, rbucks Vice President of

.


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orpora e

oc

Fair

Trade

Movement Price setting

Focus on value of entire supp

Coffee for Conservation Pro

Improves quality while focusi Current Regions:

Tanzania

Rwanda

Kenya Ethiopia

espons y

y chain

ect

ng on environmental sustainability


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ver Maintains relational capital

Focuses on ualit and urit Education

Strategic retail locations

ra egy


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oc a espoIn 2013 starbucks continued to live up to thatin communities, and minimized their environm

Starbucks have developed strong, long-term r make sure that they can buy the high-qualityall of their coffee will be rown usin ethical tr

They opened first Farmer Support Center in C(Coffee and Farmer Equity) Practices. AroundC.A.F.E. Practices standard.

Community Involvement

- - opportunities for job-ready disengaged youth.Starbucks awarded an initial $1 million grant fLeadersUp , that will bring community-based r

ra n ng o young peop e.

s es o ar uc sission of ethnical sourcing of products, investedntal footprint.

elationships with farmers all over the world, tooffee that their customers. By 2015 it hopes that

adin and res onsible rowin ractices.

sta Rica in 2004 to implement our C.A.F.E.95% of the coffee purchased in 2013 met the

-

r the development of a nonprofit corporation -sources to provide job and leadership skills

http://www.starbucks.com/responsibility/global-report


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nv ronmeRecycling: Starbucks is committed to reducinespecially when it comes to recycling.

collection and serve 25% of beverages in reusRecycling in Stores : In the last year, 70% of Stabut rec clin is reliant on the local availabilitsome local communities that provide a minimGreener Cups: Over the years, Starbucks has lenvironmental impact of the one-use cups.Energy: The energy used in Starbucks stores mfootprint.

Water: Starbucks reduced their water use bynear ng our goa o a sav ngs y .Green building: We also expanded our greencountries, and the inclusion of green building s

a ewar s p nthe waste which their stores generate

ble cups.

bucks stores recycled at least one type of wastef commercial rec clin . However there are alsol cost or non-commercial recycling.unched numerous initiatives to decrease the

kes up nearly 80% of their entire carbon

ore than 21% over our baseline levels, and are

building program, with LEED-certified stores in 18trategies in all remodels and new construction.

http://www.starbucks.com/responsibility/global-report


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ro uc e

Design for environment (DfE) o .

1. Selection of materials

.

3. Design for cleaner produc4. Desi n for sustainable con

gn or env ronmen

eco-design is becoming the major concern for

tionsum tion.


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egu a

Some of the essential regulatio1. Restriction on the use of c

2. Registration, Evaluation, A

3. Regulations on packaging

ory ramewor

s are:rtain Hazardous substances (RoHs)

thorization and Restriction of Chemicals

and packaging waste


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eanCleaner production attempts to imaterials and prevent undesirable

delivery of products and services tThe following concepts can be inc

1. Eco-efficiency

2. Waste minimization

3. Pollution prevention

4. Green Productivity

er ro uc onprove the efficient use of energy and rawpollution during production process and

customers.orporated:


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ean1. Reduce the consumption of raw materials

unit of product.

2. Increase productivity by ensuring a morewater.

.

emission.4. Reduce the environmental impact of pro

env ronmen a y r en y u co e ec ve

5. Reduce at source the quantity and toxicit

released.6. Eliminate use of toxic and dangerous mat

er ro uc on and energy used in the production of each

fficient use of raw materials, energy and

uct throughout their lifecycle by design ofpro uc s.

y of all emissions and waste generated and

rial.


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ac ag ng

Globally packaging industr .

Packaging is required for pr

However packaging is alsoenvironment if not properly

EU has given a number of d

or e env ronmen

has a turnover of around US $5000.

ctically all goods.

, .

ne of the main waste steam that can harm theanaged.

rective for packaging and packaging waste.


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og s cs an

Environmental issugrowing concern fThese issues complSCM, increasing cKey trends and th

i. Globalization

.

ren s a ec ng

s have been an area ofor business on a global scale.icate the job of logistics andsts and limiting options.ir impact are as follows:


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Globalization has increased tremen

Due to that geographical length ofattendant environmental issues of fu

For Example: FOOD MILES

Food miles is a term which refers to troduction until it reaches the cons

Food miles are one factor used wheincluding impact on global warmin

It includes getting food to the consu

ously since 1970.

upply chain have increased along with theirel use and emission.

he distance food is transported from the time ofmer.

n assessing the environmental impact of food,

mes but also getting waste food way to landfill.


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CASE: Lindt Chocolate

ource: w zer an

Destination : India

,

1396 k B roa

1125 k

By trai

388 k

878 miles (6239km)

g of CO 2 381 kg carbon, it would create a rox:

g of CO 2 307 kg carbon

, it would create approx:

of CO 2 106 kg carbon

Source: www.foodmiles.


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ar on oo pr nof Modern Suppl

Annual greenhouse gas

increasing day by day.

A carbon footprint is historicaldefined as " the total setsof greenhouse gas emissionscaused by an organization, eproduct or person .

Around 72% of the total GHGto CO 2.

There is a dire need to controemission in all spheres of theproduct life cycle.

nv ronmen a ssessmenChains

ly

vent,

is due

l the

http://en.wikipedia.org/wiki/Greenho


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Carbon Assess ent In Supply


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Carbon AssessChTo allow economies to meet thei

introduced three flexible mecha

The first two of these are the Join

to gain emission credits, and theallows countries to gain emission

ro ects in develo in countries.

The third mechanism is Emissionswhich serves as an economic inc .

pollutants allowed to be emittedemission allowance, it will have t

,

ent In Supplyins emission restrictions, the Kyoto protocol

nisms .

Implementation mechanism , which

Clean Development mechanism , whichcredits by financing emission reduction

Trading (also known as carbon trading)entive for companies to reduce pollution, ,

. If a company wishes to exceed itsbuy emission credits from companies

.


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re

Freight transport is the most.

The proportion of environmvaries strongly between diffnetwork and the product/s

As supply chains are beco

chains.

ranspor

visible issue for making logistics activities in

ntal impact of transport and transport intensityrent supply chains depending on the nature ofrvices.

ing more and more global, even simpler


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ransp

Different transport modes are:

1. Sea Freight

2. Rail Freight

3. Road Freight

4. Air Freight

. pe nes

r a on o es


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m s s o

The choice of transportatio

i. Characteristics of mode

ii. Operational Factors

iii. Cost

iv. Service requirements

ar on m ss ons y var ousselecting the transportationthe supply chain.

http://lipasto.vtt.fi/ can promodes.

y ranspor o es

modes is influenced by

mo es er an can a so pa y a ma or ro e ormode in order to reduce the overall emission of

ide data on carbon emission by different


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ac ors o co

Operational Factors:

Availability of infrastructure

Fuel taxations to lower emis

.

Cost and Service requireme

Perishability plays an impor

Consignment Factors

Truck load or less than truc

s er w en c oos ng

sions

nts

ant role

load


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ssess

The environmental balance of

Emission from Construction

Operational Emission

ng e mpac

arehouse consists of two levels:


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an a

LEED (Leadership in EnergyBuilding Council

from building research esta

Both the schemes measurer thscores based on several weighenergy and other emissions, enenergy consumed, the amoun

s o assess e

nd Environmental Design)from U.S Green

lishment in UK

sustainability of warehouses by awarding pointed criteria's such as embedded carbon,d-of-life issues such as disposal of materials andof natural resources used etc.


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http://www.innervision-design.co.uk/breeassessments.html


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emper Temperate control wareho

The thickness of the insulatitherefore also reduces the

Thus carbon at the operatioincreases.

ure con ro ese not only depend on the ability to achieve

.

n material reduces the temperature lossnergy for constant temperature adjustment.

nal stage is reduces but the embedded carbon


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oca menTechnology and increasing

Issues of health and safetyworkplace design.

on o sus a na y ncomplexity of supply chain require new skill sets

eed to be considered in the warehouse and


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Reve se Logistics


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Reverse supply chain refers to the move

Reverse lo istics is the rocess of lannefficient and effective inbound flow and information for the purpose of recoveri

ment of goods from customer to vendor

in im lementin and controllin thestorage of secondary goods and relatedg value or proper disposal.


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Reverse LogReverse processes as defined by Dekke

Col l ec t ion refers to all activities rend

Insp e c tion / sep a ra tio n denotes all oproduct is in fact re-usable and in w

Re p ro c e ssing means the actual tranProduct/ component/ material. Thisincludin rec clin , re air and remcleaning, replacement and re-asse

Disposal is required for products thatreasons. Disposal may include trans

Re-distribution refers to directing reuphysically to moving them to futureand storage activities.

istics Processr et al. (2004) follows:

ering used products available and.

erations determining whether a givenich way, it results in splitting the flow of

-

sformation of a used product into a usabletransformation may take different formsnufacturin . In addition, activities such asbly may be involved.

cannot be re-used for technical or costortation, land filling and incineration steps.

sable products to a potential market andsers. This may include sales, transportation


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RecoveryOnce the product is returned back therebe used in order to retrieve maximum val

Product recovery options include the f

Component recovery options include

components to obtain reusable comp

Material recovery option is through re

the take back. The objective of recoveryeconomic value as reasonably possible, twaste.

ptions in RLre different recovery decisions that cane from the product such as:

abrication of products.

isassembling products into its

onents.

ycling.

process is to recover as much of thehereby reducing the final quantities of


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Remanufacture Re

The aim of remanufacturing is tobring used products up to the

quality standards that are as goodas new as those for new products;

The process involved are similar torefurbishin

Reuse:

The aim is to select the part/product that can be reused

It involves selective disassembleand inspection of potentiallyreusable parts

cycleThe aim is to reuse materials fromused products and components;

Recovered materials are separatedinto categories;The material can be used toproduce original products and

It is also referred to as assertrecovery.

The aim is to sell the returnedproducts again in either primarymarket or second hand market;Old or new parts can be used in theprocessing of the product so that itmeets pre specified quality

.


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ssues n eWhen managing, coordinating and cohave to be taken into consideration byperformance (Blumberg, 2005). These is

Unc e rta in flow o f m a teria ls usuallycondition are unknown to the com

Cu stom e r sp e c i fic since return flo

Tim e c ri tic a l ly of critical importanthe need to process returned itemsreuse or disposal;

Va lue m a x im isa tio n the choice ofoption;

Flexibility processes connected w ac y, ranspor a on e c. ;

M ult ip a rty c oo rd ina t ion in order tchain processes a proper timely co

, .

erse upp y a ntrolling reverse supply chain processes certain issuescompanies in order to achieve economically viablesues are:

the time of product return or returned productanies;

s depend on end users or customers, comprehensive

e in reverse supply chain management and repair isas fast as possible in order to make them available for

the most appropriate returned product value recovery

ith product returns have to support flexible capacity

avoid slowdowns and inefficiencies in reverse supplymunication has to be established among the parties


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Closed-LoopA supply chain in which for c a n ac v es are n egra eclosed-loop.

Reverse logistics network e between the market that relethe market for new produmarkets coincide, then it isnetwork.

upply Chainard and reverse supplys sa o e one o a

tablishes a relationshipases used products andcts. When these twoalled a closed loop

e ee o r ose oop upp y


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Chain I

Scarcity of resources . Limit

closing of the material loopnatural resources.

Increased product liabilities

forcing manufacturers to pr enforcing take back laws w espons ty . EPR is d

accept significant responsior disposal of products.

p pp yToda `s Industr

d availability of natural resources has led to. ,

is a logical solution to the excessive use of

. Increased pressure from the customers is

ctice take back policies. Many countries arehich is the policy principal of Extended Producerfined as a policy approach in which producers

ility, financial and/or physical, for the treatment


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a nd ethics


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Cases such as use of child l

source from other countries.

The issue of child labour in cissue.

The kit kat killer campaign

The use of water resourceswho should be responsible f

The reports on Dirty Laundr putting pressure on global c

ybour at Nikes factories and its supplier

,

hocolate industry is another important welfare

by greenpeace accused Nestle of cutting

y Coca-Cola, India raised the question aboutor depletion of water resources.

and Detox campaign by greenpeace arelothing brands to clean up their supply chains.


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s , orporaEconomic benefits due to g

Such problems are normallyrisk called REPUTATIONAL RI

Once the trust with customthe brand, leading to a fall i

s s w y suc r s s are conwhich is a way to reduce th

e oc a espons ylobal sourcing and distribution are irresistible but

. revealed by NGOs and create a new type ofK.

rs are broken, there is a tendency to boycottn market share.nec e o orpora e soc a espons y

se risks.


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oc aSocial responsibility emphas

Means of production shouldtotal socio-economic welfa

In every society there are sresponsibility. These forces i

oc a ns u ons

Labour laws

Social consciousness

espons yes on relationship between corporate and the

be employed that leads to enhancement ofe

cial laws which form the basis of socialclude;

References


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Web pages

www.sustainablemeasures.co

http://www.rallis.co.in

. .http://ccl.gov.in

http://www.hindalco.com

http://www.iocl.com

www.bharatpetroleum.com

http://www.reliancepower.co.

http://www.tatapower.com

p: www.cxo o ay.com s ohttp://www.ibef.org/india/Sust

htt : www.financialex ress.cclimate-change-risks-into-biz-o

/indicators

in

ry e-sus a na y- ac or- n- n an- us nessesinableDevelopment.aspx

m news ma in -how-cor orate-india-is-convpportunities/401247/


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