COVID, wars, environmental challenges, and notably resource scarcity—our "supply chains" have moved from the shadows into the spotlight in recent years, revealing all their complexity, their richness, and sometimes their absurdities. What are we talking about? The supply chain encompasses several streams of corporate activity: the logistics chain, which organizes production from receipt to product delivery, but also the procurement chain, which manages transportation, storage, and resource costs. In this sense, the "supply," as we call it, constitutes the strategic, and often missing, link in a true economic and environmental transition—the one that would move from pledges to action. You can imagine it as a chain of dominoes. If just one is not in place, everything stops, the domino effect halts, and the chain reaction fails to occur.
Equipping yourself with a high-performing supply chain, aligned with current and future transition imperatives (CSDDD), means ensuring more robust supply chains, a significant sourcing advantage, and leaving legal and reputational risks to the competition… That deserves a diagnosis! Do you produce, assemble, or resell goods? This diagnosis will likely lead to a multi-step action plan. Your European factories and sites may be decarbonized and compliant with regulations, but carbon footprints have taught us this: it's scopes 2 and 3 that weigh heaviest in our impact—90% of impacts and risks come from distant factories.
Therefore, you must source agilely and fairly, build product specifications transparently and with the right inputs, assemble optimally, transport and deliver, take back, and recycle. The draft European regulation on imported deforestation, for example, is only the 1st stage of a "green procurement" rocket: soy, beef, palm oil, wood, rubber, cocoa, coffee, as well as certain derived products like leather, chocolate, and furniture are in the crosshairs.
So it's time to act. A few tips, somewhat scattered, as the subject is rich, to move quickly and far:
1/ The environmental footprint is global; it's not just about carbon, far from it!
Suppliers, product specifications, sourcing: choosing means comprehensively assessing the environmental issue. Which materials to select (plastics? wood? alternatives?), what chemistry to use, what end-of-life potential for the product (recyclability, compostability, reusability)?
2/ It is vital to structure the approach by consolidating key issues and translating your quality focus. Beware of false claims, which are myriad in sourcing. "Compostable" means nothing on its own, "biodegradable" doesn't either, "recycling" must be measurable, and "bio-based materials" as well. Serious and precise content and labeling are needed.
3/ Consider traceability and data (existence and quality) with your suppliers from the very beginning. Digital can play a major role in this area by automating data collection throughout the entire chain, from manufacturing to delivery (using analytics to calculate the carbon footprint from packaging data to make it as green as possible, on stock to optimize it, and on transport methods for better energy use). It is also possible to use blockchain to precisely and "certifiably" track the carbon footprint of products across the entire logistics chain.
4/ Identify key regulations that can significantly impact your approach and your "license to operate." In Europe, the overall policy is putting considerable pressure on plastic products and single-use items, chemistry will need to be revised with the supplement of the "Reach" regulation, and a "digital product passport" is planned under the European eco-design regulation. It will specify durability, degree of reuse, repairability, substance regulation, energy efficiency, material choices, recycled content, recyclability, environmental and carbon footprint. This passport will help consumers make informed choices when purchasing a product and will facilitate the work of authorities regarding compliance. This is no small matter.
5/ Prioritize by sector and subsector, analyze the famous "underlying factors." One supply chain is not the same as another. Even within a single company's operations, the value chains of different products and services will vary and cannot be addressed by a single strategy. These chains must be analyzed from multiple angles: by priority, by weight, or by criticality. Each supply chain, and its subsegments, must account for the realities and major trends of tomorrow's market (population explosion, geopolitical tensions, resource scarcity, …). The supply chains most at risk from regulatory, societal, or economic pressure will need to reinvent themselves first. Each element must be viewed through the lens of "sustainable development" criteria.
6/ Mobilize value chains and transform supply chains into value ecosystems for R&D and investment.
7/ Reconciling the end of the world and the end of the month: "cheap" is often an illusion, a trick of the eye; one must consider the total cost of ownership, which includes potential carbon taxes, border carbon adjustments, contributions to eco-organizations, investments in the upstream value chain (commitments and financial support from the client at all stages of the value chain, multi-year contracts vs. annual ones, …).
8/ No longer settle for purely financial business plans; a comprehensive view of business plans is needed, incorporating reliable forecasts of environmental impacts and the resulting budgetary processes.
9/ Change management is essential, as is implementing KPIs to measure the performance of internal supply chain actors. Because if we continue to judge the performance of buyers or logisticians based solely on costs, while omitting KPIs related to the economic and environmental transition, nothing will ever change!
Today, the supply chain can only be green!
