• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Linking Sustainability with Financial Outcomes in CPG

Linking Sustainability with Financial Outcomes in CPG

February 28, 2013
SupplyChainBrain

The practice of sustainability is evolving into a broader effort that extends beyond the environment to include social responsibility and economics. In addition to raising awareness of sustainability so that it is on the agenda of higher level decision makers, there is also a trend toward determining the financial implications of environmental impacts. CPG companies of all sizes are working to link sustainability with financial performance within the enterprise and across the supply chain.

Early efforts to determine the economic benefits of sustainability projects were not particularly successful. Since then, additional tools have been developed, along with an executive-level understanding of environmental terms and relationships, leading many CPG companies to innovative measurement methods. An example is P&G's supplier environmental scorecard, which they use to share savings with suppliers. Including sustainability as a measure of supplier performance is particularly relevant when large spends are concentrated on a small group of suppliers. And involving supply chain partners both up and down stream is significant for sustainability programs.

Companies like Sara Lee have also turned to life cycle analysis (LCA) to assess environmental impacts associated with all the stages of a product's life from cradle to grave. LCA enables financial analysis of environmental impacts across a product's life.

Pressure is coming from customers, forcing companies to think about the financial consequences of sustainability investments and strategies. For example, Puma developed an environmental Profit and Loss (P&L) statement for its global supply chain. Thinking like this is helping companies justify expenditures on sustainability initiatives and rationalize the high priority of sustainability in the organization.

Many companies are also striving to calculate an environmental return on investment and a financial ROI. The financial ROI takes into account the cost factors associated with an initiative. The environmental ROI considers the impacts on environmental factors, such as energy usage, water usage and greenhouse gas emissions. Analysis of financial and sustainability factors is an emerging best practice that delivers value and reduces risk exposure. But the key to success lies in analyzing environmental and financial value and risks in parallel.

The Outlook

The financial tools and methodologies needed to analyze environmental initiatives will continue to be refined, allowing for better analysis and decision making in the future. It is important to ensure that the organization has the competencies and motivation to view environmental activities from both a financial and sustainability perspective. In the future, successful CPG companies will continue to link sustainability with financial outcomes throughout the supply chain.

Source: Tompkins Supply Chain Consortium


Keywords: supply chain management, value chain, sustainable supply chains, green logistics green supply chains

RELATED CONTENT

RELATED VIDEOS

Supply Chain Finance & Revenue Management Technology Business Strategy Alignment Global Supply Chain Management Sustainability & Corporate Social Responsibility Consumer Packaged Goods Pharmaceutical/Biotech
KEYWORDS Business Strategy Alignment consumer packaged goods Global Supply Chain Management Green Logistics Pharmaceutical/Biotech SC Finance & Revenue Management Supply Chain Analysis & Consulting Supply Chain Management sustainability sustainable supply chains Technology Value chain
  • Related Articles

    Sustainability in Supply Chains Is Driven by Positive Business Outcomes, Study Says

    Report Measures Use, Impact of Plastic in CPG Sector, Urges Sustainability Initiatives

    A CPG Giant Aims for Sustainability in Its Global Supply Chain

SupplyChainBrain

Slowdown in Warehouse Construction Could Extend Shortfall of Space, Experts Say

More from this author

Subscribe to our Daily Newsletter!

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • DOCUMENTS BEARING THE INSIGNIA OF US CUSTOMS AND BORDER PROTECTION LIE ON A TABLE

    New CBP Regs Call for Greater Diligence by Brokers in Reporting Security Breaches

    Freight Forwarding/Customs Brokerage
  • A WORKER IN A WAREHOUSE, SUPERIMPOSED WITH GRAPHICS SHOWING SUPPLY NETWORK

    Enabling Intelligent Visibility With Supply Chain Analytics

    Data Management (Big Data/IoT/Blockchain)
  • GSCMS-Promo.png

    Watch: Introducing the Global Supply Chain Marketing Summit

    Education & Professional Development
  • A HAND TURNS A LARGE, LIGHTED DIAL WITH THE WORD RISK ON IT iStock-NicoElNino-1364371014.jpg

    Measuring KPIs and KRIs for Comprehensive Supplier Performance Management

    Technology
  • DEEPLY CRACKED EARTH UNDER A BLUE CLOUDY SKY

    Why Maritime Supply Chains Must Adapt to Sustainability Regulations

    Ocean Transportation

Digital Edition

Scb nov 2022 sm

2022 Supply Chain Innovator of the Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Honeywell Intelligrated IFM
Infor Inmar Keelvar
Kinaxis Korber Lean Solutions Group 2H
Liberty SBF Locus Robotics Logility
LogistiVIEW Lucas Systems MCA Connect
MPO Nvidia Old Dominion
OpenText ORTEC Overhaul
Parsyl PMMI QIMA
Redwood Logistics Ryder E-commerce by Whiplash Saddle Creek Logistics
Schneider Dedicated Setlog Holding AG Ship4WD
Shipwell Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing