Being kind to the environment can boost business
The SSCM project focused on a challenge facing many organisations today: how to maintain economic viability while becoming environmentally sustainable. Project partners made use of a database of environmental investments and practices of supply chain management from for-profit entities across the globe. Given that organisations located in the EU adopt different strategies and practices in this area of operations, gathering international data was central to the goal of better understanding the varied approaches to the issue. Furthermore, researchers deemed that a global sample would make it easier to determine whether different approaches are related to the efficacy of investment and practices. They also aimed to shed light on whether these are universally linked to reduced environmental impacts or exclusively to the setting in which they are adopted. Detailed information on actual environmental investments and supply chain management practices of some 1 300 firms in 22 countries was thus used to explore research questions regarding the efficacy of supply chain environmental investments. An initial research question was whether investments to reduce supply chain environmental impacts varied by region and country. The results returned a resounding yes, even for countries within a particular region. Exploring the influence of other institutions on managerial decisions regarding environmental investments, study results revealed that for all organisations, meeting ISO 14000 (environmental management) leads to increased environmental investment. Industry-focused examinations showed that the pace of change in this area is useful for predicting the level of supply chain environmental investment. With regard to the question of efficacy of an environmental investment in relation to the setting in which it is adopted, results showed that on the whole, increased supply chain environmental investments lead to increased operational performance — regardless of location. However, industry does have an impact on the efficacy of these investments, which do not significantly improve performance in dynamic industries in relation to cost, delivery, flexibility and quality. As such, SSCM key research conclusions are that supply chain environmental investments do generally improve the operational performance of organisations, regardless of location. Even in industries where investments neither improve nor degrade performance, results highlight that there is no economic justification for not reducing the environmental impact of supply chains. Therefore, the project concluded, underinvestment in this area is likely to harm environmental outcomes and, for organisations in static industries, operational performance as well.
