Sustaining sustainability

While the jury’s still out on supply chain sustainability initiatives, this much is clear: Unless these efforts make economic and well as environmental or social sense, they are doomed to fail.

The vast majority of climate scientists now agree that the earth is getting warmer and that the carbon humans pump into the atmosphere contributes substantially to that worrisome trend.

Where the debate now turns is to what the industrialized and developing worlds can or should do about it. While policy makers continue to debate that, many businesses have taken the initiative to begin reducing their carbon footprint and to otherwise develop sustainable business practices. The word «sustainability» has replaced «green» in much of the discussion around the topic because many of the things businesses are doing go well beyond measuring and reducing their carbon footprints.

In broad terms, sustainable business practices are those that can be employed for a long time without depleting resources or harming the environment. They include practices that foster employee growth and community wellbeing. And, as any sustainable business practice must do, they are things that over time contribute to financial health.

A lot of the effort around sustainability is occurring in the supply chain. That’s no surprise. Resource extraction, manufacturing, transportation, and so on are major sources of energy use and carbon emissions, and steps businesses take to reduce those have to be a good thing. We’ve seen some of the largest companies in the world—Walmart and UPS, for instance—embrace sustainability across their operations. One example: Walmart retrofitted the lighting in more than 100 of its DCs and may do so all over again if its current tests of LEDs (light-emitting diodes) prove out. (Jeff Smith, senior director of logistics maintenance and purchasing for Walmart, described that and other investments at Dematic’s Material Handling & Logistics Conference in Park City, Utah, in September.)

Now skeptics might argue that businesses transporting goods around the world, or providing much of that transportation, don’t really do much by marginally shrinking their enormous footprints. Others might contend that the efforts amount to mere window dressing.

But I think it has become clear that unless efforts make economic and well as environmental or social sense, they are doomed to fail. Major reductions in greenhouse gases require technological innovation that will come only through investment, and that, of course, requires capital that only healthy and thriving businesses can provide. Walmart’s lighting retrofit program, for instance, cost an average of $370,000 per DC. The company will get a return on that investment, for certain. But the investment had to come first.

Source / Fuente:

Author / Autor: Peter Bradley

Date / Fecha: 07/11/11

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