Diffusing sustainability: the crucial role of the supply chain

Federico Caniato, Thomas E. Johnsen, Toloue Miandar October 20, 2024 5 min read

The article “The Role of Purchasing and Supply Management in Diffusing Sustainability in Supply Networks” (Miandar, Johnsen, Caniato) published in Business Ethics, the Environment & Responsibility addresses one of the most critical issues for modern companies: how to diffuse sustainability not only among direct suppliers, but also along the entire supply network.

In a world increasingly concerned with the environmental and social impact of manufacturing activities, companies face a critical challenge: making not only their own operations sustainable, but their entire supply chain. This research offers new perspectives on how organizations can promote sustainable practices through their supply networks, highlighting the critical role of Purchasing and Supply Management (PSM).

PSM, traditionally seen as a tactical function aimed at cost reduction, has evolved in recent decades to become a strategic element in building sustainable supply networks. Today, PSM does not just select “green” suppliers, but actively collaborates with them to develop innovative and sustainable solutions.

Indeed, the diffusing of sustainability involves the propagation of sustainable practices through the entire supply chain, involving both immediate and next-level suppliers. This process goes beyond the traditional “cascade” model, suggesting a more collaborative and less hierarchical approach.

The study identifies six key categories of practices for diffusing sustainability:

  1. Internal integration: implementation of corporate policies and certifications.
  2. Sustainable sourcing: supplier selection based on sustainability criteria.
  3. Supplier monitoring: audits and assessments to ensure compliance.
  4. Supplier development: training programs and incentives to improve performance.
  5. Co-creation: collaboration to develop sustainable products and processes.
  6. Stakeholder management: involvement of NGOs, authorities and other stakeholders.

For example, some companies are working with suppliers to redesign packaging by reducing plastic, while others are organizing training programs to improve working conditions in supplier factories.

Moreover, research distinguishes between “peripheral sustainability,” which aims to reduce damage, and “integrated sustainability,” which aims to eliminate damage by incorporating sustainability into the company’s core competencies. PSM plays a crucial role in both of these approaches. Thus, there is a need for more academic focus on the role of PSM in co-creating sustainable innovations and managing stakeholder relationships. From a practical perspective, the study suggests that companies should go beyond simply imposing standards on suppliers. The key is to actively involve them in developing new solutions that, if adopted on a large scale, could transform entire industries, making global supply chains more sustainable and resilient. This would not only reduce the environmental impact of manufacturing activities, but could also improve working conditions and spur innovation in key sectors of the economy.

In conclusion, the article makes a significant contribution to both the academic field, suggesting new research directions, and the corporate world, providing a practical framework for improving sustainable sourcing practices. The key message is clear: only by fully integrating sustainability into operations and supply management can companies effectively address the increasingly complex challenges of global sustainability.

This article is based on
The role of purchasing and supply management in diffusing sustainability in supply networks: A systematic literature review
Publisher
Wiley
Author
Toloue Miandar, Thomas E. Johnsen, Federico Caniato
Year
2024
Language
English