Firms invested in EMSs can make the move to green supply chain management more easily, and with greater benefits. Learn how they do it, and how you can too.
How to Move Beyond Environmental Management Systems
You’ve invested in environmental management systems (EMS), you’ve achieved ISO 14001 certification and you’re wondering, “What now?”
Research by Nicole Darnall (George Mason University), Jason Jolley (The University of North Carolina) and Robert Handfield (North Carolina State University) suggests taking the next step to Green Supply Chain Management (GSCM). With minimal effort, it can reduce your environmental footprint and improve your standing with customers, regulators and environmental stakeholders.
The Difference between Environmental Management Systems and Green Supply Chain Management
Environmental Management Systems help firms inject environmental practices into all levels of the organization. Minnesota’s Federal Foam Technologies, Inc., for instance, adopted an EMS structure that allowed its facilities to reduce annual landfill use by 40 percent. This enabled the company to reduce its environmental footprint, decrease disposal costs and reduce liability risks.
While EMSs reduce the firm’s ecological footprint, they primarily focus on what goes on inside the firm or facility. GSCM looks outside the firm to infuse supply chains with the same environmental commitment. GSCM can provide substantial low-cost results that improve the firm’s reputation with environmental stakeholders.
Supply chains include all parties involved in creating a product and bringing it to market: suppliers, transportation providers, warehouses and retailers. GSCM involves assessing multiple levels of the supply chain, and requires suppliers to improve the environmental performance of their products and processes. Some car manufacturers, for example, have partnered with their paint and chemical suppliers to develop alternative environmentally friendly products.
Making the Move
With an EMS in place, facilities can more easily move to a GSCM as many of the skills learned are transferable. For instance, managers can:
Instill a culture of continuous improvement that 1) embraces internal evaluations within and between operational units 2) encourages systematic gradual improvement of environmental standards and 3) identifies and advances programs which improve environmental performance
Learn to collaborate and communicate across boundaries, which creates regular opportunities for separate departments to brainstorm and work towards common objectives.
Learn to plan strategically for the long-term by setting long-term environmental goals, identifying opportunities to reduce the future environmental impact of products and developing viable plans for seizing these opportunitiesThis research surveyed environmental managers of 489 manufacturing facilities with at least 50 employees; half of the facilities surveyed had fewer than 250 employees. The study finds that facilities which adopt EMSs are up to 29 percent more likely to adopt GSCM practices than facilities which do not implement EMSs. Facilities in the process of adopting EMSs are also 22 percent more likely to implement GSCM practices.
These results indicate that businesses acquire transferable skills when implementing EMSs and these skills allow them to implement GSCM at lower costs. By jointly implementing EMS and GSCM, you can improve your return on investment, reduce supply chain risks and improve your environmental performance at the same time.
Darnall, Nicole, G. Jason Jolley and Robert Handfield (2008). Environmental Management Systems and Green Supply Chain Management: Complements for Sustainability? Business Strategy and the Environment, 17, 30-45.