Why supply chains in technology businesses are crucial for a more sustainable future

Sustainability has risen to the top of the business agenda and for a business to be sustainable, many areas need to be considered.

Many businesses are reliant on other businesses and external suppliers when it comes to sourcing materials, components or services. The supply chain status quo for decades has neglected the environmental consequences of modern production methods, so positive change couldn’t be more needed to protect the planet. From the largest global tech giants to SMEs, supply chains are a crucial part of the sustainability puzzle and a sustainable future is only possible with greener and more environmentally friendly supply chains.

 Understanding your supply chain footprint

Businesses exist in a connected world, and many are reliant on external suppliers to function effectively. During the pandemic, supply chains began to creak demonstrating just how reliant businesses are on them. In a similar vein, businesses are dependent on their supply chains to help them be more sustainable, so it’s important to understand their supply chain footprint. The CDP has found that supply chain emissions are on average more than 11 times higher than operational emissions, so businesses need to look beyond their emissions to that of their supply chains.

Supply chains are complex but with the help of technology, understanding them – and thus improving them – can be made easier by having greater visibility. Technologies that can help with supply chain sustainability include IoT, 3D printing and blockchain. IoT sensors within a supply chain can help share data back to central control and monitoring points, to better inform sustainable decision-making. 3D printing can further help to reduce costs and wastage by being able to more easily make prototypes and products on demand. Furthermore, transparency issues have long been a problem with supply chains and blockchain can alleviate some of that by recording transactions across an entire supply chain. Technology really can be a powerful enabler for understanding and boosting a supply chain’s sustainability credentials.

The benefits of a greener supply chain

Businesses can benefit from having a greener supply chain in a multitude of ways. Supply chains are a reflection of a business’s overall footprint and many countries have enacted net zero legislation, so businesses will have to play a part in that by reducing their emissions. Legal actions will only become more common against businesses that will fall short of future duties and legal obligations. This also has an impact on reputation as some legal actions could receive significant media attention.

Supply chains, despite being external, can have positive effects on a business internally when they are sustainable, as employees want to know that they work for sustainable businesses. Attracting talent is also easier as prospective employees look to work for businesses that align with their own goals and beliefs. Another benefit of greener supply chains is that they help to reduce the overall consumption of resources, better for the protection of the environment and also the bottom line of a business. Companies can save costs by having more sustainable supply chains as a result of the reduced use of resources, so there’s also an economic benefit to reducing the use of resources.

A circular future

Over the past few decades, the status quo has been to extract new materials almost every time that something is produced. The consequences have been wide-ranging, from losses in biodiversity to excess levels of waste, rising global temperatures and pollution. Currently, the linear economic system is causing numerous environmental harms and so the status quo needs to shift towards a global economy based around the principles of circularity. It’s worth noting that discussions around the circular economy often lead to greenwashing and other negative reputational issues but what’s truly important are genuine efforts to protect the environment when the health of the planet is at risk.

Technology companies are not only in the position of being able to make positive changes when it comes to circularity, but can also help to provide much-needed solutions, as mentioned above. However, waste produced by the technology industry has had a significant impact on the environment as older products become outdated and end up as electronic waste. Sustainability and longevity need to be top priorities for products so that the ultimate environmental impacts are minimised for the long term. The product life cycle will therefore need to encompass the principles of circularity at all stages, from design and production to operations and ultimate disposal.

In a circular economy, waste is returned to the economy and reused rather than ending up in landfills. Larger and smaller technology companies alike have started to design products using recycled materials and this trend can only be expected to continue in the coming years. Many of the raw materials used in components such as semiconductors will eventually be depleted and their extraction has numerous environmental impacts. The technologies of the future may not be as reliant on oil to make plastics for example but their production is very much dependent on precious natural resources such as lithium and cobalt that need to be effectively conserved.

Looking forwards

A greener future will depend on everyone doing their bit and technology businesses will have a crucial role to play. Supply chains form a critical part of the sustainability puzzle and they must not be overlooked when it comes to creating a more sustainable future.

About the Author

Alan Hayward is Sales and Marketing Manager at SEH Technology UK. We develop and create all products at our headquarters in Germany. The US and UK subsidiaries as well as an extensive network of partners, distributors, and resellers allow for worldwide sales and distribution.

Featured image: ©metamorworks