Executive Briefings

Supply Chain Executives Are Sending Mixed Messages About Their Support for Sustainability Efforts

There seems little doubt among supply chain executives that "green" issues will have a big impact on transportation and logistics over the next three years. Some 90 percent of the 500-plus individuals surveyed by eyefortransport believe that to be that case. But just how committed they are to a green agenda and true sustainability is another question. In the eyefortransport survey, 9 percent named green issues as the number-one corporate priority, while just 1 percent believe they will lessen in importance. Factors driving the push for green include financial return on investment, public-relations payback, improved customer relations, decreased fuel bills and improved supply chain efficiency. With transportation and logistics accounting for up to 75 percent of a company's carbon footprint, there appears to be a growing focus on this area of operations. Collaboration with suppliers, partners and logistics providers is seen as vital. According to eyefortransport, 20.5 percent of respondents are using a logistics or service partner to help green their supply chains, and an additional 26 percent are considering the addition of a partner company to advance environmental initiatives.

Similar attitudes can be found in another recent study on supply chain sustainability, this one from Ernst & Young. It found 63 percent of respondents viewing sustainability as an opportunity for revenue growth, and 71 percent believing that green issues will have the greatest impact on reputation and brand identity. At the same time, only 12 percent of firms rated green issues among their top three supply chain priorities, and only 35 percent have begun to measure their carbon footprints in any way. (Another 50 percent claim to have "imminent" plans to do so.) "This may be indicative of the mixed messages businesses are receiving from governments, regulators and consumers," the Ernst & Young report says. "While concrete legislation lags behind government rhetoric on emissions reduction targets, a significant gulf exists between consumers' green claims and their actual purchasing behavior."

Visit www.eyefortransport.com and www.ey.com

There seems little doubt among supply chain executives that "green" issues will have a big impact on transportation and logistics over the next three years. Some 90 percent of the 500-plus individuals surveyed by eyefortransport believe that to be that case. But just how committed they are to a green agenda and true sustainability is another question. In the eyefortransport survey, 9 percent named green issues as the number-one corporate priority, while just 1 percent believe they will lessen in importance. Factors driving the push for green include financial return on investment, public-relations payback, improved customer relations, decreased fuel bills and improved supply chain efficiency. With transportation and logistics accounting for up to 75 percent of a company's carbon footprint, there appears to be a growing focus on this area of operations. Collaboration with suppliers, partners and logistics providers is seen as vital. According to eyefortransport, 20.5 percent of respondents are using a logistics or service partner to help green their supply chains, and an additional 26 percent are considering the addition of a partner company to advance environmental initiatives.

Similar attitudes can be found in another recent study on supply chain sustainability, this one from Ernst & Young. It found 63 percent of respondents viewing sustainability as an opportunity for revenue growth, and 71 percent believing that green issues will have the greatest impact on reputation and brand identity. At the same time, only 12 percent of firms rated green issues among their top three supply chain priorities, and only 35 percent have begun to measure their carbon footprints in any way. (Another 50 percent claim to have "imminent" plans to do so.) "This may be indicative of the mixed messages businesses are receiving from governments, regulators and consumers," the Ernst & Young report says. "While concrete legislation lags behind government rhetoric on emissions reduction targets, a significant gulf exists between consumers' green claims and their actual purchasing behavior."

Visit www.eyefortransport.com and www.ey.com