Gauteng Business News

Send  Share  RSS  Twitter  17 Jun 2009

Finance: Companies Pressurised to Green their Supply Chain


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“There is no doubt that companies are facing increased pressure to “go green”, says Larkin. “Whether it is through “green” legislation, increased pressure from customers, reputation management demands, or the growing voice of consumers – companies will soon no longer have a choice but to be environmentally conscious and responsible”. This is evidenced in two recent reports – the CSIR’s Fifth State of Logistics Survey and the supplychainforesight survey.

According to the CSIR’s Fifth Annual State of Logistics Survey, with up to 75% of a company’s carbon footprint coming from transport and logistics, the focus of supply chain greening is beginning to shift towards this area, where the opportunity to make the biggest difference exists. Transport will therefore be the major focus of discussion at this year’s Conference.

International pressure for environmental sustainability has been so fierce that the South African Government in partnership with other countries around the world adopted the Millennium Declaration in 2000. The declaration provides a framework for development activities in 190 countries in ten regions in a period that extends until 2015 and beyond. Contained within this Declaration is the need to ensure environmental sustainability. The target is the integration of principles of sustainable development into country policies and programmes to reverse the loss of environmental resources. At the CILTSA Inaugural Green Supply Chain conference in 2008 the Department of Trade and Industry outlined numerous policy initiatives in response to the Millennium Declaration and its own Long-term Mitigation Scenarios Report prepared by the Energy Research Centre for Department of Environmental Affairs and Tourism, Pretoria, October 2007. The study was initiated because South Africa is one of the highest emitters per capita per GDP in the world. South Africa’s emissions of carbon dioxide, if left uncontrolled, will quadruple by 2050 from 400 million tons in 2003. Because South Africa is a signatory of the Millennium Declaration and the Kyoto Protocol we need to show leadership through action and will need to be accountable for the link between our emissions and climate change in an effort to ensure environmental sustainability. The vision, strategic direction and framework for climate policy aims to reduce global temperature by focusing on six key areas.

1) Greenhouse gas emission reductions and limits

2) Building on, strengthening and or scaling up current initiatives

3) Implementing the “Business Unusual’ call for action

4) Preparing for the future

5) Vulnerability and adaption

6) Alignment, coordination and cooperation

An important focus is the introduction of the Carbon Tax. A levy of up to 12% will be attached to inefficient vehicles. The study projects that the tax will amount to cutting emissions by 600 million tons by 2050. If implemented correctly it will be the single biggest emission-cutting tool.

The economic recession may have a silver lining for the supply chain industry. In an effort to reduce costs businesses will inadvertently reduce their waste and this will benefit the environment in the short-term.

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