As I mentioned today in class every year Greenpeace publishes a report into the sustainability of some of the world largest electronic products companies. As in previous years, the 2009 edition is also extremely interesting to read.
The report essentially compares large electronic manufacturers across a number of important sustainability/environmental criteria (such as chemicals used in manufacturing, carbon emissions, recycling processes, and whether or not they exercise the precautionary principle for sustainability) to determine the impact their operations have on the environment. A major weakness of the report is that Greenpeace hasn’t quantified the competitive advantage which has been gained from the adoption of sustainable development practices in some of the higher ranked companies.
However from briefly analysing the document I think that it is safe to say that sustainable development practices have certainly increased the effectiveness of some of companies’ operations and also reduced their costs. For example Nokia (which has been classified as having an overall ranking of 7.5 out of 10) has been classified as having a “Good (+3)” voluntary take back system. Reverse logistics systems such as these a rapidly growing in popularity because firms are realizing that it is an untapped area for profits in many supply chains which have previously been ignored; for example they reduce traditional forward chain material procurement costs for firms if the number of returned products is high, in the case of product breakdown they allow firms to establish the causes of product failure and make more efficient product redesigns, and also allow businesses to generate extra profits through selling returned product components to other firms (this is a concept very similar to the phrase “one mans garbage is another mans fortune).
The report measures issues such as energy efficiency and carbon emissions to measure sustainability. These two criteria can also be clearly used to evaluate operational efficiency; as energy consumption is often a high cost for manufacturing firms they are often incentivised to redesign logistic, manufacturing, and warehousing operations to reduce costs, which often produce the by-product of sustainability.