Building a sustainable supply chain in the era of accountability
In recent years, sustainability has emerged as a paramount concern for businesses across all industries. As environmental and social issues take centre stage, consumers are becoming increasingly conscious of their purchasing decisions, favouring brands committed to sustainable practices. Recognising the urgent need for accountability and transparency, the UK Government has implemented new legislation to deter greenwashing and encourage authentic sustainability efforts. Here, Jeremy Whittingham, industry consultant and member of the Advanced Engineering team explores the new legislation and discusses how businesses can build genuine and robust sustainable supply chains.
Jeremy Whittingham
Introduced in 2021, the Green Claims Code serves as a regulatory framework for businesses operating in a myriad of industries. Its primary objective is to ensure that environmental claims made by these businesses comply with British consumer law and do not mislead consumers. The code addresses various concerns, including the accuracy of claims, exaggerated statements and claims that lack the ability to facilitate fair and meaningful comparisons.
The process for the Competition and Markets Authority (CMA) to examine a business’s claims and ensure compliance with the Green Claims Code involves several steps. Initially, the CMA will issue a letter of consultation to the specific business under investigation. Once the business responds to the letter, the CMA publicly announces the commencement of the investigation.
Upon completion of the investigation, the CMA possesses the authority to recommend that the business voluntarily amend its messaging to align with the code. If the business fails to comply with these recommendations, the CMA can initiate legal proceedings. This escalates the risk of court involvement, potentially resulting in financial penalties and damage to the company’s reputation. Any litigation actions taken by the CMA will also be publicly disclosed.
There are several essential steps in building a sustainable supply chain. The initial phase of embarking on a sustainable path involves evaluating the current supply chain and pinpointing areas that require enhancement. A thorough audit should be conducted to examine various aspects, including the sourcing of raw materials, manufacturing processes, transportation methods and waste management. This comprehensive assessment will yield valuable insights into the present environmental and social impact of the supply chain. With the assessment in hand, it is then crucial to define specific and measurable sustainability goals. These goals should align with industry standards, international accords (such as the United Nations Sustainable Development Goals) and the expectations of stakeholders. By setting clear targets, businesses can hold themselves accountable and ensure their efforts are well-directed.
Businesses should also explore energy-efficient manufacturing processes that prioritise resource optimisation and minimise emissions. By investing in renewable energy sources to power operations, companies can reduce their reliance on fossil fuels and mitigate carbon footprints. Another area to focus on is transportation. By optimising transportation routes, businesses can reduce the distance travelled, minimising fuel consumption and greenhouse gas emissions. Exploring greener transportation alternatives, such as electric or hybrid vehicles, biofuels, or even using rail or waterways when feasible, further contributes to reducing the carbon footprint associated with logistics.
Incorporating circular economy principles into the supply chain is another effective approach. By emphasising recycling, businesses can implement systems that encourage the collection and reprocessing of materials, reducing the need for extracting virgin resources. Implementing closed-loop systems or collaborating with suppliers to integrate recycled or upcycled materials into production processes can significantly contribute to waste reduction and resource conservation. Furthermore, waste reduction strategies, such as lean manufacturing practices can help minimise waste generation at every stage of the supply chain. This involves streamlining processes, optimising inventory management and finding innovative ways to repurpose or utilise by-products.
Building a sustainable supply chain necessitates strong collaboration with suppliers, as they play a pivotal role in shaping the overall environmental and social impact of a business. To ensure a sustainable supplier base, businesses need to establish stringent selection and evaluation criteria that prioritise suppliers’ sustainability performance. By thoroughly assessing suppliers’ practices, companies can determine their ability to align with sustainability goals. To provide clear guidance and expectations, a comprehensive code of conduct should be developed. This code should outline the specific environmental and social standards that suppliers are expected to uphold. Additionally, sustainability clauses should be seamlessly integrated into contractual agreements to ensure that suppliers are contractually bound to adhere to sustainable practices.
Transparency should be embraced as a fundamental principle throughout the entire supply chain. Businesses can achieve this by implementing robust systems that trace the origin of raw materials, guaranteeing responsible sourcing practices that align with sustainability criteria. Sharing this information openly with consumers and stakeholders becomes crucial, as it provides concrete evidence of the authenticity behind sustainability claims. To bolster credibility and enhance transparency, businesses can leverage emerging technologies such as blockchain or other digital tools. These innovations enable the provision of verifiable evidence, ensuring that sustainable practices are genuinely implemented and can be validated along the entire supply chain.
The ultimate goal is to cultivate a supplier network that shares the same commitment to sustainability. By working together, businesses and suppliers can drive innovation, share knowledge and collectively address sustainability challenges. Through continuous communication and collaboration, the entire supply chain can become a powerful force in promoting sustainable practices, benefiting both the business and the broader ecosystem. This transformative journey towards sustainability will not only secure businesses’ reputation but also contribute to a greener, fairer and more resilient future for all.
This year, at Advanced Engineering, visitors will be able to experience our sustainability trail, showcasing exhibitors that have a product or service that helps reduce our impact on the environment. To experience this, and much more, register for a ticket on the Advanced Engineering website.
