Sustainability has become a key component for many businesses, with a particular focus on sustainable supply chains that reduce their environmental impact and promote social responsibility. A crucial area in business sustainability is supply chain management, where companies must ensure that their operations are not only profitable but also environmentally friendly and socially responsible.
Many companies have made sustainability a core part of their business strategy, implementing sustainable practices throughout their supply chains. From using renewable energy sources to reducing waste and promoting fair labour practices.
This article highlights the top 10 most sustainable supply chains, based on their commitment to sustainability and the impact they are having on the environment and society. This will help us gain insight into the key principles of sustainable supply chain management and how they can be implemented in other industries.
Automotive manufacturer Ford has implemented sustainable practices throughout its operations. The American firm has launched a program to reduce the environmental impact of its vehicles, such as reducing greenhouse gas emissions and improving fuel efficiency. Ford has also implemented sustainable practices in its manufacturing processes, in the form of using renewable energy and recycling materials.
In its 2023 Integrated Sustainability and Financial Report, Ford revealed how the company’s global supply chain protects the environment, as it builds a new EV and battery supply chain to secure raw materials directly from mining companies aligned with Ford’s corporate policy.
In 2021, Ford initiated EV and battery supply chain mapping and auditing to better understand the origins of raw materials in its EV supply chain, including nickel, lithium, cobalt and graphite. To date, the project has conducted 30 supplier audits along these four critical mineral battery supply chains at all tiers of the mine site. In early 2023, along with its suppliers, the company also underwent an audit of its nickel, lithium and cobalt due diligence management systems.
French multinational food-products corporation Danone is focused on promoting sustainable agriculture, reducing greenhouse gas emissions and using renewable energy sources. Danone has set ambitious goals to reduce its environmental impact, including becoming carbon neutral by 2050 and using 100% renewable electricity by 2030. Danone is also promoting regenerative agriculture and reducing waste.
The dairy giant has also pledged to reduce its methane emissions from its milk supply chain by 30% by 2030. As part of its regenerative dairy strategy, the company has already cut gas emissions by 14% between 2018 and 2020 and expects to cut another 30% on top of that in the next seven years.
This means having to remove 1.2 million metric tons of carbon dioxide by the decade’s end. Danone’s target of a 30% absolute reduction in methane emissions from fresh milk used in its dairy products makes it the first food company to align targets with the Global Methane Pledge.
Since 2015, Danone has partnered with B Lab to help define a meaningful and manageable path to certification for multinationals and publicly traded companies, as well as accelerate the growth of the B Corp movement into the mainstream.
Sportswear manufacturer Adidas has made sustainability a key priority in its operations. The company has committed to using more sustainable materials in its products, including recycled polyester and sustainable cotton. Adidas has also implemented sustainable practices in its manufacturing – and transportation processes – and has launched a program to improve the sustainability practices of its suppliers, actively extending its sustainability reach to its scope 3 emissions.
Along with Puma and Gildan, Adidas improved its rankings on the Corporate Knights’ 2023 Global 100 list of the world’s most sustainable corporations.
The food and beverage company Nestlé has made ‘regenerative practices’ a core part of its business strategy which, with a $92.81bn investment in 2021, is having a considerable impact. Nestlé has implemented sustainable practices throughout its supply chain and has set ambitious goals to reduce its environmental impact, seeking a 20% reduction of scope 1, 2 and 3 GHG emissions by 2025, and a 50% reduction by 2030.
Nestlé has also launched a program to help smallholder farmers improve their sustainability practices, which has positively impacted the environment and local communities. The food and beverage company is also aiming for 100% of its key ingredients to be produced sustainably by 2030.
In 2022, Nestlé opened “one of the most technologically advanced” coffee plants in the world, leveraging a host of sustainable technologies to reduce its impact.
Perhaps not a company expected to be on this list, the global beverage manufacturer has implemented sustainable practices in its manufacturing and distribution processes, with 90% of its packaging being recyclable globally where viable infrastructure exists, almost up to 99% in Germany. Coca-Cola has set a goal to replenish 100% of the water it uses in its beverages and production processes, with 61% of the equivalent bottles and cans they introduced into the market in 2021, being collected for reuse or recycling.
In 2020, Coca-Cola Europacific Partners (CCEP) committed to reducing net emissions across its value chain by 30% by 2030, before bringing them to net zero by 2040. At the time, CCEP said in a statement that it was ready to go further and faster after reducing value chain emissions by 30.5% since 2010.
Multinational automotive and clean energy company Tesla is leading the way in increasing sustainable transportation. The company’s electric cars have zero in-use emissions, which has a significant impact on reducing global greenhouse gas emissions, with 39% of global transport emissions being attributed to them.
The Elon Musk-founded company has also recently released the ‘Tesla Semi’, its answer to the highly polluting logistics industry. According to a Reuters report published on December 16, 2022, PepsiCo will look to put 100 Tesla Semis into service in 2023
In 2022, the global fleet of Tesla vehicles, energy storage and solar panels enabled Tesla’s customers to avoid emitting 8.4mn metric tons of CO2e. Tesla has also implemented sustainable practices throughout its manufacturing processes, such as using renewable energy sources and recycling materials all the way up and down the chain.
Consumer goods company Unilever has made sustainability a key part of its business strategy, and they aren’t afraid to admit why. “We are not an NGO,” said the CEO Alan Jope. “We’re a for-profit organisation. And the reason why we care so much about sustainable business, B corps, and other expressions of it is because we think it contributes to the bottom line. We’re seeing our brands that offer consumers a sustainable choice are growing much faster.”
The company has set ambitious goals to reduce its environmental impact and has implemented sustainable practices throughout its supply chain. Unilever has also launched a program to help smallholder farmers improve their sustainability practices, which has not only had a positive impact on the environment but also on local communities. 53% of Unilever’s plastic packaging was reusable, recyclable or compostable in 2021, and the company recycled 633,344 tons of waste in the same year, out of a total of 658,665 tons of generated waste.
In April 2021 they introduced the Unilever Regenerative Agriculture Principles which provided guidance on how to nourish the soil, capture carbon and restore and regenerate the land. With the aim to inspire their business, divisions, brands, suppliers and peers, to form the basis for regenerative programmes for ingredients in its supply chain.
The globally recognised furniture retailer, IKEA, has implemented sustainable practices throughout its entire supply chain. The company uses renewable energy sources, such as wind and solar power, in its manufacturing and transportation processes. In 2020, IKEA reached its goal to secure that any wood used in its products comes from more sustainable sources and has implemented recycling programs for its products at the end of its life.
Through its IWAY program, IKEA ensures the responsible sourcing of products, services, materials and components. It sets clear expectations and ways of working for environmental, social and working conditions, as well as animal welfare, and is mandatory for all suppliers and service providers that work with IKEA.
Outdoor clothing company Patagonia has set a high standard for sustainable supply chains in the fashion industry. The company uses sustainable materials such as recycled polyester and organic cotton in its products and has also implemented fair labour practices in its supply chain. Patagonia has also committed to transparency and regularly discloses information about its supply chain to the public.
The clothing company announced in its responsibility program that its suppliers surpass its minimum compliance requirements, but it is still focusing on performance, the implementation of best practices and continuous improvement. For example, Patagonia is currently working on a new carbon-reduction performance program with key raw-material suppliers that supports the decarbonisation of its operations.
This aims to reduce the carbon footprint of manufacturing through a wide range of resources and incentives that prioritise energy efficiency, renewable electricity and the use of less carbon-intensive fuels in order to reduce the company’s collective impact on the climate.
In 2022, Yvon Chouinard, the billionaire founder of the outdoor fashion brand, announced plans to give away his company to help fight the climate crisis.
Global manufacturer of commercial flooring Interface has made sustainability a core part and central principle of its overall business strategy. The 2020 UN Global Climate Action Award Winner, previously announced 75% of the energy used at its manufacturing sites is from renewable sources, including 100% renewable electricity at all factory sites.
76% of the energy used at their owned manufacturing sites is renewable, and they saw a 96% reduction in market-based GHG emissions at their carpet manufacturing sites, not to mention that 50% of all the materials in Interface’s flooring products are recycled or bio-based.
Interface has also implemented a closed-loop recycling system where it recycles used carpet tiles into new products. This has not only reduced waste but also reduced the company’s dependence on non-renewable resources.
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