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Why Companies Should Green Their Supply Chain Management - Research Paper Example

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Increasing cross-border transactions in supply chain is a phenomenon closely associated with the liberalization and globalization of economies. The intense competition drives the manufacturers to keep the cost of raw materials and labor low…
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Why Companies Should Green Their Supply Chain Management
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Why Companies Should Green Their Supply Chain Management

Sourcing of raw materials with right quality and lower price necessitated movement of materials across the continents. On the other hand, shifting of production facilities to the places where the cost of labor is cheap is also considered by the companies. These twin strategies result into movement of raw materials and finished products from place to place cutting across the borders of the nations. The increase in the level of activity in the flow of the movement of goods over the period of time necessitated revisiting of the strategies by the corporate companies in respect of supply chain management with a view to reduce cost. However, the developments that have been taking place in the environmental front warrant corporate social responsibility (CSR) in view of atmospheric pollution which leads to global warming, water pollution, human rights issues involved, and extinction of animal and plant species. Judicious use of natural resources in the process is very important for maintaining ecological balance and the welfare and rights of the future generations. Also, growth at the current level with the accelerated use of natural resources is not sustainable in the long run. ...
Green supply chain management Parry, P., Martha, J. & Grenon, G. (2007) state “the supply chain is the production and distribution network that encompasses the sourcing, manufacturing, transportation, commercialization, distribution, consumption, and disposal of goods, from the ore mine to the trash can”. Primarily, the uninhibited consumption of energy at various levels leads to inflation in the energy prices. The cascading effect of the increasing fuel prices results into inflation in food prices and becomes a threat to food security. The impact of greenhouse gas emissions is considered to be very serious as the damage to the environment could be irreversible. Supply chain management needs to play an important role in reduction in the consumption of energy in an organization. This could be achieved through a comprehensive corporate strategy which encompasses conservation of energy on voluntary basis, compliance with the regulations as a good corporate citizen, savings in cost by reducing emissions, adoption of standards issued by various agencies and environmental auditing, water and effluents treatment, recycling, waste disposal and renewable energy. For instance, according to a study by Canning, P. et al. (2010) food processing showed the largest growth in energy use. Recycling of packing materials, generation of electricity from waste and avoiding use of environmentally unfriendly packing materials in the industry would not only be beneficial to the environment and the society but also results into cost saving. According to Bruntland report “Development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (The World Bank Group, 2001). Emission of ... Read More
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