So why is sustainability important? Or more specifically, why is sustainability within a supply chain so important if multiple organisations that all have their own business goals and processes are involved?
The importance of sustainability lies in two parts. In a business context, the value is in the consistent nature of growth and continued operations. In an alternate environmental context, sustainability lies in reducing the depletion of natural resources and harm on the environment to support long-term ecological balance. Whilst each definition focuses on different contextual considerations, the importance of both lies within the long-term nature of their focus.
But that’s not where the importance of sustainability ends, especially when concerning supply chains. The environmental impact that supply chains have regarding the total emissions of an organisation is substantial when compared to the direct impact of the company. Upwards of 80% of all greenhouse-gas emissions and 90% of the environmental impact on air, land and water come from supply chain operations within a typical company’s supply chain. Figures that highlight the powerful impact supply chains have on the environment around them.
Supply chain sustainability has also had a large effect on consumer purchase behaviour. Although consumers have previously foregone questioning where their products come from and how they’re produced, that’s changed significantly over the recent past. Now customers are more concerned than ever, and their values have changed to reflect their new concerns. Whilst value and ease of purchase may still remain the primary drivers behind purchasing decisions, sustainability is now becoming a bigger factor. Consumers are now willing to spend between 2-10% more on products produced by companies with supply chain transparency. Consumers are also willing to stop purchasing products altogether. A survey led by Hotwire found 47% of internet users worldwide ditched products and services from brands that violated their personal values.