Green supply chain: how do carbon management and sustainable development create competitive advantage for the supply chain?

Citation

Cucchiella, F. and Koh, L. (2012), "Green supply chain: how do carbon management and sustainable development create competitive advantage for the supply chain?", Supply Chain Management, Vol. 17 No. 1. https://doi.org/10.1108/scm.2012.17717aaa.001

Green supply chain: how do carbon management and sustainable development create competitive advantage for the supply chain?

Article Type: Guest editorial From: Supply Chain Management: An International Journal, Volume 17, Issue 1

Sustainability science has been a hot, emerging, complex and multi-disciplinary topic for quite a few years now in the supply chain research sphere. The economic, social and environmental aspects should be taken into consideration when balancing and analyzing the impact of carbon management and sustainable development on supply chain. Organizations in today’s society are increasingly expected to know that their suppliers are as mindful of their environmental and social responsibilities as they are themselves, in other words they are expected to look after the sustainability of their entire supply chain.

In the transition process towards a greener supply chain, organizations reviewing their business processes should look beyond their factory walls. Organizations should find suppliers who have minimal environmental impact without sacrificing the quality of their product or significantly raising costs. By purchasing products from green suppliers, organizations can then begin their restructuring towards a green supply chain from the upstream. On the downstream, organizations should look at their return process. However, many organizations have not developed a successful refurbishment program for their products that have been returned or exchanged. By offering refurbished products, organizations can increase purchasing options to their customers and widen their customer base, whilst improving the environmental impact of their products.

There are many ways in which organizations can move towards a green supply chain; however it is important to realize that it is difficult to achieve results without strong focused leadership. Green supply chain strategy makes sense from an overall business perspective, but the vast majority of organizations are in early stages of strategy development. While customer and the end consumer are increasingly expecting organizations to be green, they may not necessarily be willing to pay the extra costs, especially given the current economy.

Although green supply chain management research has started to heat up, there have been few multi-disciplinary, comprehensive and holistic studies about it. The existing studies vary in detail. There are a few papers that collect studies, categorize them and conclude the trend of research. There is a substantial amount of research related to sustainability, including integrating environmental, environmental management, green-product design, and closed-loop supply chains. However the competitive advantages derived from a green supply chain implementation are not clear for many organizations, in such sense, there are several aspects that have to be analyzed, and indeed implemented at end-to-end supply chain. This is an immensely complex supply chain problem and will require multi-year initiatives as well as technology-enabled analytical analysis and tracking tools.

This Special Issue contains 7 papers and 2 industry insights, each providing its own unique contributions to advance the understanding of Green Supply Chain: How do Carbon Management and Sustainable Development Create Competitive Advantage for the Supply Chain. This Special Issue contains papers that are highly innovative and high quality conceptual, analytical models, empirical and case studies addressing the above related issues and papers that are multi-disciplinary and extend beyond the dyad. This Special Issue is complemented with the industry insights, which, together, provide an excellent combination of conceptual and theoretical value, and industry and practical value to the readers for maximum impact of the research, development and deployment of the work in the area of green supply chain management.

The first paper entitled “Will environmental logistics be promoted by changing industrial structure? A quantitative analysis from 1978 to 2007 in China” by Song, M., Wang, S., Jiang, Z., Yang, J. and Wang, Y., is one of the first of its kind to develop and empirically analyse the relationship between energy consumption of logistic service industry and its influential factors in China. It uniquely contributes towards finding approaches to constructing China’s environmental logistics. Interestingly, the paper found that the mileage travelled by train is the most important factor of energy consumption, whilst travelling miles of highway the second. The former has a negative correlation with the total of energy consumption whilst the latter has a positive correlation. It was suggested that the study will have far-reaching implications for other developing countries.

The second paper entitled “Sustainable supply chain management across the UK private sector” by Walker, H. and Jones, N., focuses on addressing how organisations vary in perceptions of internal and external enablers and barriers to sustainable SCM practices, and in predictions for the future of sustainable SCM. Based on the exploration of the practices of leading firms in sustainable SCM, it provides lessons for organisations seeking to improve their sustainable SCM practices. The paper adopts a contingency theory perspective and brings together existing literature to develop a typology of sustainable SCM approaches, based on the variety of organisational approaches to sustainable SCM, and the best practice case studies are mapped onto this typology. It explores predictions of the future of sustainable SCM within companies, to gauge where sustainable SCM practices might head in years to come.

The third paper entitled “Performance measurements in the greening of supply chains” by Björklund, M., Martinssen, U. and Abrahamsson, M., outlines important aspects to consider in the design of environmental performance measurements in supply chain management and identifies shortcomings in existing research. The case presents successful examples of how environmental performance measurements can be applied across managerial levels as well as company borders in a supply chain. The application is demonstrated through a single company’s borders by including four different actors in the supply chain.

The fourth paper entitled “Greening community pharmaceutical supply chain in UK: a cross boundary approach” by Xie, Y. and Breen, L., designs a green Pharmaceutical Supply Chain that results in reduced preventable drug waste and more recycling of inevitable drug waste, therefore improved environmental, economic and safety performances of waste. A Cross boundary Green Pharmaceutical Supply Chain approach is proposed to address the actions to be taken by each participant in the Pharmaceutical Supply Chain. Peripheral influences are also recognised from professional and regulatory bodies. This approach encourages total involvement and collaboration from all participants in the supply chain.

The fifth paper entitled “Natural resource based green supply chain management” by Koh, L., Guang, V., Baldwin, J., Shi, S.C. and Cucchiella, F., conceptualises a structural model of natural resource based green supply chain management, and its relationship, with an indication of cause and effect, to relevant performance measures and drivers. Constructs are identified in terms of intra- and inter-organisational environmental practices, performance measures and institutional drivers. This paper is a theory building exercise to provide an alternative and more comprehensive conceptual framework for understanding green supply chain management in terms of natural resource based view and its interactions with green supply chain management performance measure and institutional drivers. With respect to the advancement of theory, green supply chain management has been explored on a more in-depth and theoretical level, by integrating natural resource based view and institutional theories, and addressing both internal and external perspectives of the firm. The new framework complements earlier green supply chain management case-based empirical research by taking a more holistic approach to a firm pursuing the green supply chain management strategy and leads to a conceptual alternative in the form of a structural model. Causal relationships have been formulated through both existing empirical findings and by identifying theoretical propositions.

The sixth paper entitled “Sustainable value chain analysis – a case study of Oxford Landing, from “vine to dine” by Soosay, C., Fearne, A. and Dent, B., is the first to combine Life Cycle Analysis (LCA) with Value Chain Analysis (VCA) in a context that allows researchers, practitioners and policymakers to identify areas for improvement, in what they do and how they do it. The paper shows how Sustainable Value Chain Analysis (SVCA) can be used as a diagnostic tool to identify misalignment between resource allocation and consumer preferences, using a case study of the Oxford Landing wine chain, from South Australia to the UK. The case study demonstrates the value of comparing the consumer value associated with a particular activity with the emissions associated with that activity, as this draws the attention of managers, at each stage of the supply chain, to the potential trade-offs that exist and the danger of focusing on either one (adding value or reducing emissions) in isolation.

The seventh paper entitled “Evaluating ecological sustainable performance measures for supply chain management” by Sarkis, J., Bai, C, Wei, X. and Koh, L., seeks to apply a grey based neighbourhood rough set approach to help manage performance measures within the broader performance measurement systems environment. Methodologically, this is the first time that grey systems theory is integrated with neighbourhood rough set theory. In this paper, a conceptual application of the tool after introducing a variety of environmental and business performance measures for a supply chain environment is provided. These measures are developed based on the supply chain operations reference (SCOR) model. Insights into the application of the technique from both a research and managerial perspective are presented.

The first industry insight entitled “Implementation of a sustainable business cycle: the case of a Swedish diary producer” by Svensson. G. and Wagner, B., describes a corporate implementation and application of a “sustainable business cycle”. The study found that the company’s “sustainable business cycle” may be divided into nine stages beginning with the arable land through to the dairy and transportation of products to market, where the final two stages involve external retailers and consumers, all of which is important to fulfilment of the earlier seven internal stages. The main contribution of this paper is to present a rare detailed case study of a sustainable, organic milk supply chain. It highlights the areas where sustainability is effective. It also illustrates the challenges for an SME trying to extend the reach and to create awareness of added value to the consumer.

The second industry insight entitled “Low carbon and green supply chains: the legal drivers and commercial pressures” by Hitchcock, T., discusses the growing supply chain pressures, both legal and commercial, the background to them and their implications for countries with large consumer markets, such as the UK and for countries, such as the Republic of China, which are suppliers, but themselves increasingly important as consumer markets. The writer’s background is that of a lawyer in the UK whose practice covers topics such as product safety as well as environmental regulation, and who has a long-standing interest in encouraging business to pursue sustainable development. Having regard to the multi-disciplinary nature of the readership it is not proposed to focus too narrowly on legal regulation: nevertheless the legal perspective is important in at least one respect. The imposition of law and penalties provides a powerful incentive to behavioural change, and is very effective in focussing attention.

Overall, this special issue provides an excellent combination of conceptual, theoretical, analytical, empirical and practical contributions from authors to the area of green supply chain management. Evidence shows that there is considerable advancement in research, development and deployment of green supply chain measures, management and practices. Interests have also been found to study developing and emerging economy such as China. Similarly European focus, such as UK cases are not lacking. This international dimension is at the core of the nature of the supply chain itself, where increasing reliance of an international supply chain will subsequently call for a better understanding of ways to green such a supply chain and how do carbon management and sustainable development create competitive advantage for the supply chain. This Special Issue contributes to the advancement of the understanding of green supply chain management.

We could not have done this by ourselves and we totally appreciate the efforts and support of all who were involved in making this Special Issue possible, which includes the authors, referees, editorial staff of Supply Chain Management: An International Journal and the editor of the journal. The guest editors gratefully acknowledge the assistance and support provided by the editor of Supply Chain Management: An International Journal, Dr Beverly Wagner, and the referees who reviewed the manuscripts for this Special Issue.

Federica Cucchiella Department of Electric Engineering and Information, Faculty of Engineering, University of L’Aquila, L’Aquila, Italy

Lenny KohLogistics and Supply Chain Management Research Group, The University of Sheffield, Management School, Sheffield, UK