A wide range of companies are conscious of the
environmental impacts of their products and services. A smaller number
of leading companies have adopted a stewardship mindset and are
developing innovative best practices in supply chain management. These
companies are experimenting with techniques that match their brands as
well their footprints. Levi’s has studied and visualized the life cycle of a pair of jeans, Walmart is harnessing massive data from its suppliers.
In studying supply chain innovation, I got to thinking: what input lies at the foundation of every single supply chain? The answer is energy. Since energy is such an integral input to any modern supply chain (not to mention a central piece of our climate crisis), I thought I’d flip the question on its head: how can the energy industry itself improve sustainability across its own supply chain? And what lessons can the energy sector learn from leaders in other industries?
In the energy sector, the majority of attention will remain focused on fuel stock – the fuel used for power generation and its method of extraction – as the key to a truly sustainable industry. While this focus is appropriate, it doesn’t capture the scope of the opportunities across the supply chain. Think, for example, of the 120 million utility poles used for electricity transmission in the US alone; or the tremendous amount of water used in resource extraction for energy production and generation; or even the sustainability issues within the renewable energy space itself. The growth potential for sustainability improvements in the energy sector supply chain is limitless.
As the energy industry organizes itself to address sustainability throughout its supply chain, here are a few guiding principles to consider: