Business fails to act on key Green issues

Despite business increasingly "talking green", most managers have not acted to reduce the huge impact of their supply chains - the process by which products and services get from design to delivery, and usually one of the most polluting area of the business.

Data from BearingPoint, a management and technology consultancy, shows that just 35 percent of firms surveyed claimed to have a "green supply chain" in operation, although 83 percent claimed to factor green issues into their strategy.

Jonathon Porritt, founder-director of Forum for the Future and one of Europe's leading Green campaigners, said: "One of the most telling tests of whether or not a company is really serious about addressing today's corporate responsibility challenges is to see what it's doing about its supply chain. And the simple conclusion from this report is that not enough companies are doing enough. Yet 2008 absolutely has to be the time for companies to get properly stuck in on supply chain initiatives."

Of particular concern for governments and environmental organisations, the largest percentage of executives who responded said it was not lack of return on investment (9 percent of responses) which held them back, or the high cost of implementation (11 percent) but a lack of information about new regulations and best practice (36 percent).

The survey questioned 601 directors of firms with turnovers ranging from 0 million to more than billion.

BearingPoint also revealed that those companies which have acted are seeing a significant increase in customer satisfaction and are gaining some competitive advantage as a result; furthermore they are not only preempting likely new legislation, but also benefiting from savings in operating costs.

The report also highlights how there needs to be a shift in perception that green supply chain solutions are not simply technology implementations but rather a catalyst for business change and revenue growth. This is not yet being recognized as only 13% of firms invest more than 10% of their total supply chain investment budget in environmental projects.

"The question for businesses is whether to act now, on their own terms, or wait to be forced to do so later, either by legislation or, just as likely, a need to catch up with the competition", said Laurence Dupras, BearingPoint's director of supply chain services in Europe.

Companies in different countries also varied widely in their performance. Asked whether they were doing anything at all to factor green issues into their supply chain, 100 percent of Japanese firms said they were. In the U.K. the figure was 45 percent and in the U.S., which performed worst, it was just 24 percent. Supply chain is now regarded as the key business area for environmental impact. Last year the German Environment Agency said that 80 percent of a product's environmental impact was "factored in during the design phase".

"The decision to act on this issue is about much more than corporate responsibility," said Dupras. "It is about what companies need to do across their supply chain to remain competitive in today's, and tomorrow's, global market."