CSR and sustainable supply chains

A new CSR-driven initiative by UK supermarket Morrisons, and First Milk, a dairy-famer owned business is a good example of a sustainable supply chain. The organisations have joined forces to test the viability of using wind-turbines to generate and use or sell electricity. The trials will also examine how to recover heat from bulk milk tanks.

First Milk has been the major supplier of British cheddar to Morrisons for a number of years, so the partnership was already tried and tested. Morrisons itself, as part of its own CSR work, started a Farm Programme in 2009, developing a network of farmer groups across the UK to drive applied research with the aim of developing a sustainable British agriculture industry.

Morrisons is funding initial trials for both of the projects above, which will then be rolled out to more farmers in the First Milk network.

This example gives some useful pointers to how sustainable supply chains can be developed and made to work.

Firstly, Morrisons' support for this project is in line with its own CSR strategy, which includes objectives for reducing carbon emissions, supporting British farming and positively influencing the sustainability of its supply chain.

Secondly, this is clearly a partnership with a supplier, rather than a dictatorship. First Milk has an innovative idea, which Morrisons is helping to bring to life. This could well bring a competitive advantage, as well as increasing the security of supply.

Thirdly, these projects are for long-term, rather than short-term success. The decision to support the trials is based on the future impact and value for the organisations, rather than on short-term cost.

Fourthly, for both organisations, these trials are clearly a real boost to their reputations and CSR credentials. Morrisons has already begun to win respect as a sustainable responsible brand. Initiatives such as these help reinforce that reputation. Companies whose suppliers adopt sustainable practices also benefit from those good reputations. Conversely, where suppliers are acting irresponsibly with regards to the environment or the workforce, this can easily negatively impact on companies higher up the chain.

In summary, in order to ensure a truly sustainable supply chain, companies need to work to identify their top priorities and build their strategies around these. These need to be embedded into the organisation and well communicated to all employees. The actions set for suppliers need to be fair, as it is unreasonable to expect suppliers to do what you are unwilling to do yourself. In addition, clients and suppliers need to work together to achieve the goal of a sustainable supply chain. If businesses push their suppliers too hard this can damage the supplier's business, and their people. If you want your suppliers to change you need to be clear about what and how you want them to change, and be willing to help them.

Creating a sustainable supply chain as part of a CSR strategy will not happen overnight. It could take many years, but once goals and objectives are set, you can put in place incremental steps to get there. Changing the supply chain is a long-term goal, but will have short-term benefits, and ultimately build a better business.

Photo Credit: Alistair Hamilton http://www.flickr.com/photos/alistairhamilton/