Green supply chain management: manufacturing a Canadian perspective

Highlights

With increased attention to corporate responsibility and the requirement to comply with environmentalregulations, green supply chain management (GSCM) is becoming increasingly important for Canadianmanufacturers. While the value of GSCM activities is rarely disputed, literature to–date has been sparse in presenting tangible evidence regarding performance and business benefits. For this reason, Supply Chain and Logistics Association Canada (SCL) and CanadianManufacturers & Exporters (CME) partnered with Industry Canada to review the important service business function of GSCM. This resulting report provides unique insights to help Canadian manufacturing supply chain executives understand current trends and to recognize the benefits of adopting GSCM practices in distribution activities.

Companies that have adopted GSCM practices with a focus on distribution activities have successfullyimproved their business and environmental performance on many levels.

Key findings:

• Most Best–in–Class (BiC) businesses^{Footnote I} are able to better differentiate their distribution services, improve risk management, increase sales, and increase access to foreign markets, all while reducing distribution costs.
• Main GSCM business drivers include the high cost of energy and a desire to have a competitive advantage over other firms.
• The reduction of energy and lowered greenhouse gas (GHG) emissions in distribution activities are thetwo main environmental improvements arising from the adoption of GSCM practices.
• Since many GSCM practices require limited investment, are low–risk, and offer short–term return–on–investment periods, businesses of all sizes are able to engage in these activities.
• Despite the large number of businesses that understand the importance of GSCM, the numberof firms that actually engage in such practices is significantly lower.

Approach and methodology

This report is based on a collaborative undertaking between SCL's research committee, CME, and Industry Canada's ServiceIndustries and Consumer Products Branch. The SCL research committee and the CME defined industry needs, drivers, and metrics and offered valuable insights from an industry perspective. By using the 2008 Green Supply Chain Survey (1 165 business entities which included more than 600 manufacturing organizations) conducted by SCL, and applying unique economic models developed in–house, Industry Canada provided the overall analysis and brought together all the components needed to produce a Green Supply Chain Management report for Canada's manufacturing sector.

This report is one of a series of three GSCM reports:

• GSCM: Manufacturing — A Canadian Perspective;
• GSCM: Logistics & Transportation Services — A Canadian Perspective; and
• GSCM: Retail and Consumer Product Goods — A Canadian Perspective.