Making The Moving Scene Green
Environmental and sustainability issues are generally agreed to be important in business and yet adoption of practical measures remains limited. This was the finding of the Barloworld Logistics supplychainforesight 2016 report, Navigating Smart. Reasons vary, but it boils down to cost versus profit, innovation versus effectiveness.
While every form of transport has some kind of environmental impact, some of the best companies conduct their business in the most environmentally-friendly way, says Andrew Marsay, a transport economist. He says many big international companies have built their market reputation on adherence to triple bottom line accounting (profit, people, planet) and this gives them a competitive edge. Government is keen to expedite buy-in to environmentally-friendly practices by proposing a carbon tax on various industries, including transport. The aim is to combat greenhouse gas emissions by offering tax incentives to reward the efficient use of energy. A revised Carbon Tax Bill is expected to be published during 2017.
Brand association and reputation
Consumers are also becoming more aware of environmental and sustainability issues and associate brands with either their good or bad ethics in this regard, notes Paul Dallas, supply chain executive at Amka Products. “In terms of the Consumer Protection Act we stand shoulder-to-shoulder with our customers in providing consumers with sustainable, quality, environmentally safe products,” he says.
Cost constraints continue to hamper the best-laid environmental plans, says Marilize Worst, managing director of SmartMatta. When it comes to waste management, she says, companies still compare
long-term sustainable options to the short-term cheap option of landfill.
Added value and the integration of infrastructure
“A systems approach provides benefits in the reduction of transport costs, generation of added value through waste handling optimisation and integration of infrastructure, all resulting in a decrease in energy consumption and subsequently carbon emissions. The foundation of this approach is the integration and balance between modes, which provides scope for a more efficient use of the transport system and the complete review of the requirements needed to satisfy all links in the supply chain,” she explains.
To achieve zero waste to landfill, she advocates a four-step plan:
- create a baseline;
- understand your sustainability goals;
- develop a project plan that includes constant communication and feedback on achievements and progress; and
- assess, align and realign the plan.
“It is also very important to focus on information management and reporting,” says Worst. “The management of information flow is one of the key drivers for success in environmental and sustainability-based operations. Poor data measurements and lack of appropriate capturing, using and analysing of information are the major concerns for sustainable practices.”
Reducing your carbon footprint
Reducing one’s carbon footprint is a major challenge facing companies today, agrees Dallas. Amka manufactures and supplies a range of hair, personal and home care products.
The company adopted an environmental sustainability policy in 2015, covering environmental health and safety, energy management, operational risk management and sustainability reporting. The policy is communicated to all staff and reviewed annually.
Dallas says Amka strives to achieve the energy reduction targets set by the Department of Trade and Industry. The development of its new manufacturing and warehousing campus meets the requirements of the environmental impact assessment.
The company manages packaging from “cradle to grave” and an upgrade of plant and machinery, lighting and other equipment includes the latest in low-energy consumption technology. “We have implemented I-Teams (innovation Teams), each with a specific objective to meet the challenges we face,” he explains. “Each I-Team has clear objectives and reports back to the management business review team at least once a quarter.”
These objectives are arguably ideal for most logistics operations and include:
- green warriors: make the company more eco-friendly;
- sustainability: decouple growth from environmental impact and increase social impact;
- salus (derived from the Latin term meaning safety, welfare and wellbeing): improve the health and safety of the work environment; quantum leap: prioritise improvements that can be implemented in the current factory;
- quantum lean: drive changes within the supply chain to attain world-class operational efficiency and quality; and
- pack chain: identify opportunities to reduce packaging while maintaining and improving delivered quality.
Collaboration and environmental management standards
Amka has a contract with Imperial Retail Logistics to supply warehousing and distribution in South Africa. Dallas says Imperial’s environmental sustainability policy and programme has been an inspiration and together they work to reduce the environmental impact of their businesses.
Dr André Venter, Imperial Logistics’ sustainability executive announced earlier this year that the company had proactively developed a set of environmental management standards as part of its “duty of care”. Five areas in focus include the management of waste, energy, water and wastewater, greenhouse gases and prevention of soil and groundwater contamination.
Collaboration across the supply chain yields greater results than going it alone. Eli Golovey, Nando’s head of logistics for South Africa, Africa and the Middle East, reports positive results from collaboration with logistics supply company, CHEP to remove paper and waste from its supply chain. Fresh chicken is now shipped in crates rather than cardboard boxes. The result is less packaging; lower inventory costs; more chicken shipped per truckload; improved quality of product; and an overall reduction in environmental impact.
The cost of an environmental programme is not easily quantifiable as a holistic policy affects all operations of the business. However, the experts agree that the long-term benefits for planet, people and profits far outweigh the initial investment.