Supply Chains Are The Turning Point Towards A Circular Economy!

Blog - Container shipI read an article the other day that was sent to me by Greenbiz titled, “The art of bringing science to sustainable development”. It’s an interview actually between Mary Hoff, Editor in chief of Ensia and Pavel Kabat, director general of the International Institute for Applied Systems Analysis, a 43-year-old international organization that brings researchers together across 23 nations to guide public policy. The gist of the interview basically supports the idea that science usually comes up with the solutions to many everyday problems but, then leaves it to government to implement. Mr. Kabat explains that, “The absolutely biggest obstacle is the terribly siloed system we are part of — not as much anymore in science, but at the level of the global governance and institution structures” and goes on to say, “If we don’t have that transformational change in the institutional and financial governance in this important process of implementing the development goals, we will terribly misinvest and mistarget” and I think he’s absolutely right.

When asked, “what made you want to work at the interface of science and policy?” Kabat replied, “It’s partly a kind of frustration. We see there is much more known than the policy-making process is willing and able to absorb and/or use. We believe we’ve got to make major steps towards a global transition on the climate before it is too late. But we also genuinely believe that we can turn upside down and change the fundamental paradigm. Namely, that sustainable and environmental issues — such as climate change or transitions to a decarbonized world — actually present huge opportunities, as opposed to threats, to economic development. We believe that transitions can actually be economically and socially beneficial, and this needs to be better communicated to the policy-makers”.

That really got me thinking, what is it or how is it that we’re going to transition to a Circular Economy? Where do we begin and what steps do we take to get there or, are we kidding ourselves that it can even be done?

Blog - Truck pollution3I’ve been working in the supply chain the better half of my life and I’ve given serious thought to this subject of transitioning to a circular economy and how we’re going to pull that off. Step back and think about that for a second. Where does most everything come from that ends up in our landfills and how does it get there? Supply Chains! Why do we have greenhouse gas-emitting transport trucks polluting our atmosphere on every corner of the globe? Supply Chains! Why do we have mining operations, factories and warehouses hogging the landscape almost everywhere you look? Supply Chains! How did everything around you, including the house that you live in, get to be there? Supply Chains!

From cradle to grave, supply chains are at the heart of the movement of just about everything. Basically, our entire global infrastructure is designed and built around supply chains. Certainly, there are other sectors that are available to sustain us but, when you think about it, supply chains alone touch on an enormous aspect of our everyday lives and we don’t even give it a second thought but, maybe we should!

All this talk about climate change and global warming due to GHG emissions has a lot to do with supply chains. Most trucks drive empty when returning after their delivery and most trucks are only partially full even when they’re doing their deliveries. When you combine those two problems with the excessive packaging that most merchandise is wrapped in, you begin to realize that we actually ship more “air” than we do merchandise!

Wooden pallets use more of the annual hardwood harvest than all other uses combined and yet their use in the supply chain continues unabated. There are over 500 million new pallets created each year in the U.S. alone to replace the ones that are discarded every year, many of them designed for single-use. I don’t know how many trees we have to cut down to produce that many pallets but it’s a sizable number to say the least and trees are the lungs of the earth. Next to the oceans of our planet, trees absorb more CO2 than any other system on earth.

discarded wood palletsIf we could find a way to eliminate empty back hauls, partial loads, excessive packaging and wooden pallets we could reduce GHG emissions dramatically and this is the entire point of this post. The supply chain represents the turning point towards a circular economy better than any other point on our current linear make-use-dispose trajectory. What better starting point is there to begin transitioning towards a circular economy than the supply chain? The hardest part of any transition is taking the first step and defining that first step is the key to a turning point. Supply chains can be huge and consist of many component parts so the first step will be to define “where” in the supply chain we focus our efforts. I would suggest the transport sector as this is the component part that emits the most GHG emissions within the supply chain and arguably, has the greatest need for wooden pallets next to warehousing operations and, it is during transit leg of its journey that merchandise requires the most packaging for protection.

There is a Canadian consulting group that is developing a system to eliminate empty back hauls, partial loads, excessive packaging and wooden pallets in an effort to reduce GHG emissions while improving the efficiency and sustainability of the entire value chain. They’ve also identified the perfect starting point within the supply chain to take that first step in transitioning towards a circular economy. This 60-second presentation video of their new system gives you a good indication of where they’re headed or you can learn more about it on their site. Theirs is a paradigm shift in innovative thinking and they’re setting the stage for disruptive technologies in the supply chain.

The greatest threat to our planet is the belief that someone else will save it ~ Robert Shaw


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