Companies demand a green supply chain – and save billions in the process

Energy efficiency and greater use of wind and solar energy have cut costs for some big retailers. (© AP Images)

Energy efficiency and greater use of wind and solar energy have cut costs for some big retailers. (© AP Images)

Companies may have more clout in promoting environmentally friendly business practices than they thought. A new report from the CDP (formerly Carbon Disclosure Project) reveals that demands for a more sustainable supply chain have saved billions of dollars.

And these are big hitters: Wal-Mart, General Motors and Microsoft are among 89 of the world’s largest companies asking suppliers to disclose environmental data for the report. The data show that suppliers who acted to reduce greenhouse gas emissions saved a total of $12.4 billion in 2016.

Much of the savings in the top 100 projects came from energy efficiency.

“Lower emissions in the supply chain isn’t just about helping the environment; it’s a business imperative which boosts our competitive advantage and builds our resilience for a low-carbon future,” said Nicola Kimm, head of sustainability at Philips Lighting.

Forbes, in its article about how “Suppliers Are Being Asked To Cut Emissions — And Saving Billions As They Do So,” examines the CDP data and the beneficial impact of greening the supply chain.

Many suppliers are still responding slowly, despite a rising demand from companies and customers for sustainably produced products. But those who are cutting emissions are reaping rewards.

Bestway (Hong Kong) International told the CDP that, after encouragement and energy-efficiency training from Wal-Mart, they saw successful emissions reduction in the first year. “Going forward we are eager to continue measuring, reducing, and reporting emissions through CDP, sharing a vision for sustainability with key clients such as Walmart,” the supplier stated.

For more details, including the “A-list” of companies demanding greener supply chains, see the CDP’s 2017 Global Supply Chain report The Missing link: Harnessing the power of purchasing for a sustainable future.

By: Lea Terhune