Comment: Achieving sustainability – collaborate, then compete

Whether it is awareness driven by David Attenborough’s Blue Planet or the ‘mindful buying’ millennials and Generation Zs, the impact of our consumer society on the planet appears to be increasingly influencing purchasing behaviour. But how easily can retailers or producers make the necessary changes to improve sustainability?

Alan Gunner, Business Development Director, Adjuno, explains the value of retailer collaboration throughout the supply chain to improve sustainability standards globally.

The Risk of Innovation

With the latest news about the vast quantities of micro plastics in our rivers, drinking water and bottled water, the tide of consumer opinion is turning fast. Understanding the sources of these micro plastics is key – with many believed to come from modern fleece-type fabrics during the washing process. And micro plastics is just one concern; retailers are working with science and academia in a bid to discover new products that have better environmental credentials – from recyclable man-made fibres to cotton production methods that use far less water.

One organisation that recently took a public stand on improving its sustainability is LEGO. Rather than continuing to use conventional plastic, LEGO are introducing new sustainable elements made from polyethylene, a plant-based plastic. Although this new programme still needs some consideration in regards to the environmental impacts of the sugarcane the polyethylene is produced from, this initiative shows that LEGO is pushing forward with new methods and constantly re-evaluating the environmental impacts of its products. In fact, this is just the beginning for the LEGO, who are committed to using sustainable materials in all core products and packaging by 2030.

But while there are potential competitive advantages to be gained from going it alone and making that sustainable breakthrough, the risks are also significant. Stick your head above the parapet with a strategy that is not 100% robust and prepare to be shot down.

So, where and how can retailers make a difference? Small incremental gains are likely, in reality, to have a far bigger impact, not only on the environment but also on the lives of those involved in the manufacturing process. Focusing on production methods to reduce the amount of water used in the creation of cotton products, from farming through to processing, is essential. As is minimising the toxicity of chemicals used in the dyeing process. The world has finite water and energy resources – failure to become far more effective in production will affect not only consumer perception but also profitability.

SEE ALSO:

• HP pledges supply chain transformation as part of its 3D journey

• Hershey pledges $500mn to improve supply chain sustainability

• Comment: Achieving a sustainability-centric retail model

• Read the April issue of Supply Chain Digital here 

Era of Collaboration

Such achievements are far more likely to be achieved collaboratively, by retailers working together to drive up sustainability within factories. Following the 17 goals for sustainability laid down by the UN in 2015, including nine set by the Ethical Trading Institute (ETI), there are significant opportunities for retailers to collaborate – from sharing performance information to jointly funding ethical audits.

One organisation supporting this ‘open information’ approach is Common Objective, which is building up a database of suppliers – including their ethical and sustainable credentials - from information provided by retailers. This database will help other organisations quickly locate the best source of, for example, sustainably produced cotton T-Shirts, or suppliers that work to a specific ethical standard.

In addition to reducing the barrier to sustainable production for retailers, this collaborative approach also frees up resources to focus on innovation that could provide a competitive edge. For example, strong, end to end supply chain insight and control can provide the ability to track the source of every piece of wood used within the product line, from the type of tree to location and certification, to ensure all wood is sustainably sourced. Similar models could be adopted for products made from leather, cotton or feather and down.

Furthermore, with this collaborative model reinforcing the credentials and business value of a pool of high quality suppliers, retailers can create strong foundation for continual innovation within an established and trusted supplier base, delivering incremental sustainability improvements year on year.