Home » Green Supply Chain Management
green scm
Unsplash/Abdul Kayum

Green Supply Chain Management

by Editorial Office

The number of companies documenting their CO₂ footprint has increased sharply in recent months. However, for many, the road to a sustainable supply chain is still quite long. That is one of the key findings of the 15th Hermes Barometer on “Green Supply Chain Management,” a survey conducted among 200 logistics managers at German companies.

Almost 75 percent of the logistics managers surveyed for the Hermes Barometer believe that companies need to integrate environmental and social criteria into their target systems and their decisions in order to ensure long-term competitiveness. “The Corona pandemic has strengthened the trend towards sustainable consumption – and thus sustainability has once again gained in importance for customers. The challenge in logistics should therefore not only be to take these changed requirements into account, but also to continue to drive sustainability in a future-oriented manner,” explains Stephan Schiller, CEO of Hermes International, a business unit of Hermes Germany.

Around one-third of respondents (36 percent) have at least identified the need to develop sustainable strategies in order to reduce their environmental footprint in the future. The majority are in the midst of developing or implementing such strategies: among them, almost one-third of respondents have already developed sustainable strategies for their supply chain (31 percent). Further, one in five companies has started to implement environmental strategy measures within their supply chain (22 percent). By contrast, only one in ten companies (10 percent) has successfully implemented a sustainability-oriented strategy to date.

Number of companies accounting for CO

As a result of these efforts, the proportion of companies recording their CO₂ footprint has increased. While only 19 percent of German companies had reported their CO₂ footprint in the spring of 2020, 31 percent of those surveyed now do so – an increase of 12 percent. In addition, 56 percent of those companies also report the CO₂ emissions of service providers and suppliers – an increase of 24 percent compared to 2020.

“These increases are considerable, especially in view of the current very challenging times. In addition, they illustrate what companies can achieve when those responsible are committed to sustainability concerns in a results-oriented manner,” says Schiller, commenting on the results.

Measures for COreduction

53 percent of the companies already actively reporting their CO₂ emissions are opting for alternative means of transport or regionalizing/diversifying their supply network (47 percent) in order to cut emissions.

69 percent of these companies additionally offset the CO₂ emissions they cause – an increase of 14 percent compared to spring 2020. “The clear objective of any sustainability strategy should be to operate in a socially and ecologically responsible manner, yet also economically at the same time. Offsetting CO₂ emissions can be a sensible module in this context, something we also rely on at Hermes Germany. Nevertheless, the clear focus for us lies on reducing and avoiding CO₂ emissions, says Schiller.

Obstacles on the way to CO assessment

In spring 2020, just 8 percent of logistics decision-makers had planned to report their emissions in the near future, whereas 34 percent of companies not yet active in this area are currently aiming to do so. Only just one in four of the cited respondents (24 percent) do not plan to record their CO₂ footprint in the near future. In spring 2020, this figure still came up to 65 percent.

Alas, what prevents companies from accounting for their emissions? 37 percent of logistics managers who do not yet report their emissions cited the lack of uniform standards as an obstacle. This was followed by a lack of sustainability management in the company (35 percent) and a lack of demand from customers (19 percent).

Environmental awareness as a driver – right up to the company limits

For 40 percent of the German companies surveyed, “green supply chain management” is currently of very high or high importance. In addition, the vast majority of logistics managers (84 percent) agreed with the statement that growing environmental awareness will be a key driver for changes in supply chains in the coming years. “This change in environmental awareness is also noticeable in our exchanges with customers,” confirms Schiller. “Currently, our customers are increasingly approaching us with the desire to make their supply chain more sustainable.”

However, the sustainable design of the supply chain often ends at the company limits: 61 percent of those responsible agreed with the statement that they have only moderate influence on the behavior of their supplier companies and almost no access at all to the behavior of downstream companies – an increase of six percent compared to spring 2020.

Logistics experts would therefore like to receive support from their service providers. Thus, 54 percent of respondents agreed with the statement that logistics service providers should consult on the reduction of CO₂ emissions.

Green Supply Chain Management

Although the majority of respondents have recognized the need for green supply chain management and there is a fundamental willingness to design a sustainable supply network, the shift toward green supply chain management is still in its infancy. “For companies, it is now a matter of actively entering the process in order to secure their own competitiveness and future viability in the long term,” says Schiller.

Logistics specialists such as Hermes Germany support companies in identifying and addressing optimization potential along the supply chain. As part of a holistic analysis, existing processes are examined and recommendations for action or concrete measures for increasing efficiency and improving sustainability within the supply chain are pronounced.

Related Posts

Leave a Comment

* The processing of your personal data takes place in accordance with our privacy policy.

Please accept [renew_consent]%cookie_types[/renew_consent] cookies to watch this video.