Trickle-Down Sustainability

Fast Company has an article by Damian Joseph in its Ethonomics section on ‘sustainability scorecards’ that should be hanging in every exec’s office. The story centers on efforts by Proctor & Gamble and Kaiser to rate their suppliers on everything from energy and water use to waste and greenhouse gases.

The article does a nice job illustrating why sustainability is such a powerful force in business... it's trickle-down sustainability (Ronald Reagan would be proud). P&G efforts come on the heels of having received a similar scorecard from Wal-Mart in 2009.

The implicit message of the article is that every business (large and small) should be working now to improve their environmental footprint - before they receive a scorecard in the mail.

Dean Edwards, Kaiser’s VP and chief procurement officer, is quoted in the article, saying, “We’re sending a message to vendors loud and clear…Green up your act today, lest you lose a huge client tomorrow.”

We’re guessing a lot of companies are going to take that message to heart. Joseph estimates the combined purchasing power of P&G and Kaiser to be $121 billion, with P&G totaling some 75,000 suppliers worldwide.

Joseph reports that P&G formed a Supplier Sustainability Board to help create its sustainability scorecard, and “based the form on standards defined by the World Resource Institute and the Carbon Disclosure Project.” Joseph also reports that Kaiser is using its scorecard to choose vendors: “if there's a tough choice among suppliers, the vendor with the best score gets the nod.”

If you would like to read the article in its entirety, online it’s entitled Suppliers Set Out to Grade Products with Sustainability Scorecards. In the printed edition, the headline is Score Two for Sustainability and can be found on page 54 of Fast Company.

As elucidating as Joseph’s article is, it is just the latest in a growing tide of articles and white papers alerting the marketplace to major shifts in consumer and corporate buying priorities. One such article worth reading is entitled Sustainability is on a Roll, written by Michael Arny, president and founder of Leonardo Academy.

First published as part of a Media Planet supplement in the Chicago Tribune, Arny starts off by saying “When we buy products or services, we are buying both the good and the bad associated with their entire life cycle.”

He continues this thread, saying that greening the supply chain “provides one of the lowest cost opportunities for improving a company’s sustainability.”

Arny then delivers a call to arms:

The driver for implementing green requirements will emerge from IT innovations such as cloud computing that offers ways of harnessing data in ways that were not previously accessible. As a result, supply chain accountability will organically evolve from the old mainframe based infrastructure to an integrated green machine. Once this gets rolling, greening of supply chains will become inevitable in the cloud-connected world. Each company and organization should be asking itself: “Are we ready? And are we getting ready fast enough?”

This last point is one we agree with wholeheartedly; as an innovator in cloud computing for EH&S compliance solutions, MSDSonline knows first hand the power of Software as a Service (SaaS).

Essentially, both articles are saying the world is changing and every company involved in a supply chain needs to be doing all that it can to make sustainability a key priority, especially in the use and handling of materials and the consumption of resources. In order to make safer, greener choices in regards to materials, you first have to know what you are using and in what quantities.

For that reason, chemical inventory management is one of the easiest ways for a company to begin greening the supply chain. A robust chemical inventory management solution can help you:

  • Track and control everything that enters your chemical inventory
  • Calculate and report on chemical quantities
  • Cross reference inventory with state, federal and global regulatory lists

The top 3 reasons to go sustainable and employ a chemical inventory management solution are:

  1. It's the right thing to do: It's safer for employees and the community and is environmentally responsible
  2. It's a business necessity: it's the price of admission into the supply chain of certain industries; it's cost effective, value driving; it can provide a marketplace advantage in sectors where the adoption of sustainable practices is happening more slowly
  3. EH&S Compliance: A good chemical inventory management solution can help you streamline your reporting activities and avoid fines and citations related to non- or under-reporting

In the past, sustainability was the domain of the very small and the very large companies. Going forward, everyone will have to get in the game. If you are in the supply chain of a company like Wal-Mart, P&G, Nike, Kraft or Kaiser, your future depends on it.

For another sustainability call to arms, check out our post From Nike to OSHA: Sustainability is the New Plastics.

-The MSDSonline Team-