Supply Excellence — Use Tighter Eco Standards to Your Advantage

Use Tighter Eco Standards to Your Advantage

April 5th, 2007 · by Tim Minahan · No Comments · best practices, enviro/social sustainability, supply management, supply risk

If posts yesterday and earlier on how sustainable supply practices are lowering costs and improving profitability haven’t motivated you to factor environmental and social responsibility into your supply strategies, pending regulations may force your hand on the issue.

A Supreme Court ruling this week portends tighter restrictions on carbon dioxide and other greenhouse gases. The ruling, coupled with a pro-environmental Congress, is expected to force the Environmental Protection Agency to issue tighter regulations on auto and manufacturing emissions. It could also set the stage for tighter scrutiny of materials and waste that damaging to the environment.

The ruling comes just as the United States is receiving pressure from foreign governments – particularly the European Union – to join the Kyoto Protocol, which assigns stringent targets for controlling emissions.

While the slow pace of legislation will delay the impact of any new regs until at least next year, supply managers would be wise to begin preparing today. As noted in The Greatest Supply Tip Tips of All-Time (download a copy here), savvy supply management groups have used crises – like complying with the Sarbanes Oxley Act or ROHS or WEEE – to elevate their strategic role within the business and to secure much needed support, budget, and resources for their own initiatives. The latest rulings (as well as political and market dynamics) strongly suggest that sustainability is one crisis supply managers should leverage to their advantage.

Volunteer to head up your company’s sustainability and emission control task force. Work with manufacturing to assess energy consumption and emissions. And team up with suppliers to consider alternative processes and materials that could reduce emissions and lower costs across the entire supply chain. The early moves could help you gain a cost- and performance edge over reluctant competitors. They should also give you the support and funding required to drive your supply management transformation initiatives.

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