3 Supply chain academics explain why sustainability concerns more than just emissions
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Following the surge in digitalisation sparked by the pandemic, sustainability has arguably become the predominant theme discussed within the logistics and supply chain sector. However, as companies increasingly talk up their sustainability credentials and ambitions, there are clear signs that some perspectives on the concept of sustainability are narrower than others.
This is a subject that’s very close to academics David B. Grant, Alexander Trautrims, and Chee Yew Wong.
The trio are the authors of the Kogan Page-published book, Sustainable Logistics and Supply Chain Management: Principles and Practices for Sustainable Operations and Management, the 3rd edition of which is due to be released on 3rd November.
David, Alexander and Chee also worked together to develop an MSC course in sustainable logistics during their time at the University of Hull.
David is Vice Rector (Dean) of Research and Societal Impact and Professor of Supply Chain Management and Social Responsibility at Hanken School of Economics in Finland. Alexander is Professor of Supply Chain Management at Nottingham University Business School, while Chee is Chair of Supply Chain Management and Director of the Centre for Operations & Supply Chain Research at Leeds University Business School.
In the previously-published editions of the aforementioned book, David, Alexander and Chee have covered numerous areas related to sustainability and supply chains, as well as the concept of sustainability itself.
What’s clear from looking at the books is how sustainable supply chains can be viewed as being about so much more than low CO2 emissions. In the opinion of the authors, waste, recycling, reverse logistics, corporate social responsibility, and employment conditions are also part of the sustainability equation.
To find out more about the latest edition of the book, and talk about the state of play when it comes to sustainability in the logistics and supply chain sector, we reached out to all of the authors.
Professor Trautrims, whose research focuses on sourcing, compliance and supply issues in supply chains, told Trans.INFO that the new edition of the book features more social sustainability aspects.
Alexander added that companies will also have to consider their employment practices if they wish to be more sustainable:
“I think we’ve included a lot more social sustainability aspects in this book than we had done beforehand. There’s a debate going on both in academia and in industry about how we manage sustainability.
I think social sustainability is probably decades behind the environmental conversation in terms of management approaches and measuring improvement. I think that’s still an area of sustainability that’s not as developed as environmental science.
When it comes to trade offs, there are different options that come with different sustainability concerns. There are maybe uncomfortable trade offs or even dilemmas that companies are having. Going back to the earlier considerations or discussion around sustainability more widely, I think the really tricky bit is always when the more sustainable option costs more money.
That’s really where things come to a crunch. I think most companies are still preferring the most commercially advantageous option with a short term view. To see the bigger picture, we need to go into systemic issues around internalising external costs. This means making companies pay for the emissions that they’re producing, as well as including minimum safeguards for workers.
Companies will have to consider how they can continue to outsource their workforces and treat workers as independent contractors instead of staff with full employment rights. We’ve seen some poor practices concerning labour rights in the logistics sector and the operational levels of supply chain management.”
Professor Grant also touched on social sustainability during our discussion, stating “I don’t think it’s doing very well”.
As for what is new in the 3rd edition of Sustainable Logistics and Supply Chain Management, David told Trans.INFO:
“In the process of writing the book, the three of us sat down and said that there’s more to sustainability than just carbon emissions. One of the aims of the book was to go beyond emissions into things like recycling, the circular economy, modern-day slavery, and some of the social sustainability issues that Alex is an expert in.
What I have introduced into the new addition relates to some of the COP 26 elements from last year. Without saying so explicitly, we’re treading water and not really getting to the sort of reduced [carbon emission] numbers that we should be.”
David was also keen to emphasise that the book is accessible and comfortable to read:
“The book was designed to be very user friendly and easily readable. It doesn’t have a real scientific tone with lots of data. Yes, there’s data to set the scene and make the reader aware of what the issues are, for example, that the two biggest polluters in the world, the US and China, also have the largest GDP. We make those kinds of linkages.”
A significant factor in most logistics companies’ drive to net-zero is of course offsetting. Is it working effectively though?
On that topic, Professor Wong explained how offsetting may not be going to plan in some cases:
“If you go to the US, you see a lot of the companies offering certificates for offsetting and so on. There have been cases when the same piece of land is being used for offsetting many times.
One of the main challenges with regards to offsetting is that it can take years to offset. Nobody knows what happened to those targets, two, five, or ten years later. Therefore a lot of offsetting is not working.”
When asked about whether offsetting can ever be truly tracked, David added that a degree of trust is still required:
“Well, there are ways to do that [ensure the offsetting is actually happening]. I’ll give you an example from the university I work at in Finland, Hanken. We are trying to become carbon neutral by 2030, as I’m sure Leeds and Nottingham and other British universities are too.
We’re actually a long way towards that. We’ve put solar panels on the roof, and we buy our energy from an environmentally friendly source. Now, the energy supplier tells you they’re environmentally friendly, and you have to take them at face value.
One of the things we can’t get rid of is all the carbon emissions, especially when we have staff flying places for conferences and so on. So we offset, and there are standards for various offsetting schemes that are from gold standard down. We always purchase a gold standard. In fact, what we purchase for offsetting relates to some development in Africa, in this case, providing fresh water among other things. So you can do things that way.
I don’t know what the accounting rules are in Britain or elsewhere that would force you to do this. A lot of firms who are conscious about their environmental credibility will probably do that, and say they only buy gold standard offsetting.
However, again, you’d have to take them at face value for what they say. It’s the same with us, when we buy the carbon offsets, we go through it in a sustainability group that I chair at the university. And then we make a recommendation to the rector and the board to say this is the one. But you’re never really sure. You just have to kind of go on the information you’re given.”
Globalisation has been another key topic covered in the editions of Sustainable Logistics and Supply Chain Management.
The new book is no exception, and its release comes at a time when there is discussion regarding deglobalisation as well as the nearshoring and reshoring of supply chains.
Chee acknowledges that this is being discussed, but also explained to Trans.INFO why pivoting one’s supply chain amid today’s global disruption can prove difficult.
“Yes, there is talk of deglobalisation. In the past, if we had a supplier in one part of the world and there was disruption, you could go somewhere else to find an alternative.
The type of disruption we see nowadays is nonetheless different, because it is actually spread around the world. If we try to find another source, we’ll often find a similar problem. Like COVID, the issue is not contained in one place. We see the same with inflation, and it can take a much longer time to recover.
The transition towards a more nationalised supply chain is not really that easy either, because there is still a lot of infrastructure spread out in different parts of the world. You can’t simply just decide to move elsewhere.
Many companies said they’d move to India or Vietnam due to tensions between the US and China. However, a lot eventually failed to do so because they couldn’t move from one country to another and expect their supply chain to follow. So this is quite difficult.
Of course, there are structural changes now in China; a significant number of businesses left, including companies from the USA and Japan. Even some Korean companies had to choose whether they should stay in China or not.
There will be changes, but rationalised ones centred on whether you are on the US or the Chinese side, or whether you are building more supply chains and infrastructure in Europe.
For example, Europe is concerned about not having enough factories that make the microchips needed by the automotive industry and so on. There are a lot of questions about how this can be done quickly.”
What do the authors hope the book can achieve?
In David’s case, he wishes to see the book further the debate on sustainability:
“We wanted that wider approach, we wanted to look at things beyond emissions. So your scope one, scope, two, scope, three emissions, which is a much wider platform.
If there’s an opportunity where we can be involved with a corporation to do some things, maybe on a consultancy basis, to help introduce sustainability to them, talk to them or do workshops or seminars, it would help get the word out and make people aware.
What we’re saying is that we’ve got a lovely place that we live on, planet Earth, and it’s sort of stupid to screw it all up. So how can we help to make people aware? We’re not going to change the world. I can guarantee you people aren’t going to listen to the three of us and change automatically. But if we can help foster the debate then we’re winning.”
Meanwhile, Chee hopes that the findings and principles in the book can have a positive influence on supply chain managers:
“If the books are used by academics for teaching, they could be very useful for people from different backgrounds to understand sustainability from a logistics and supply chain perspective. I hope to see supply chain managers one day realise they need to know more about sustainability. I hope that’s the contribution we can make in practice.”