Challenging though it may be, responsible sourcing can be a manageable method for becoming a more sustainable business, especially for suppliers and retailers. Recent examples show practical ways of responsible sourcing throughout the global supply chain.

The emergence of the “green” supply chain isn’t a new concept. For years, consumers have been mindful of the products they purchase, keeping tabs on ingredients, packaging and the origin of various goods. Suppliers and retailers have reacted by offering more products that reflect healthier and more sustainable attributes.

Yet this approach is not exclusively about “green” issues, according to Darin Yug, a Diamond Management & Technology Consultants, Inc. partner who leads the firm’s Supply Chain practice and co-author of a 2009 report titled “Staying Green While the Global Economy Sees Red” (free registration required). “Properly managed, green initiatives can help companies lower their overall expenses and edge out competitors as new regulations come into play,” Yu said in a statement.

Even in the current economy, consumers are becoming more aware of the products they buy and how they are made. In essence, they are considering the entire supply chain before they make a purchase.

Retailers like Wal-Mart are aware of the reputation boosts that come from responsible sourcing initiatives. As the largest retailer of jewelry in the world, the company recognized the opportunity to promote more sustainable practices throughout the jewelry supply chain. Wal-Mart worked closely with its suppliers, mining company partners and Conservation International to develop environmental and social criteria for sourcing materials. Targeted areas for improvement included mining, refining, polishing, cutting and manufacturing. (See Wal-Mart’s New Game-Changing Mandate)

Manufacturers such as L’Oréal are making a “commitment to build long-term partnerships with suppliers, based on mutual respect, transparency and sharing of information, strong communication and high standards.” The company has held several internal and external meetings to not only raise awareness, but also train staff and suppliers on labor standards requirements, environmental impact, health and safety and supplier diversity.

“Our efforts to ensure that our suppliers abide by strict social standards strengthened further this year, with 688 independent audits on labour standards at our suppliers’, subcontractors’ and traders’ production sites,” the cosmetics company says. “We also involved 30 percent of our supply base (by revenue) in the Carbon Disclosure Project’s ‘Supply Chain Leadership Collaboration’ survey to encourage supplier disclosure on carbon emissions.”

Meanwhile, Bon Appétit Management Company‘s socially responsible sourcing practices have also been gaining momentum, proving that sustainable food can scale to meet volume and service demands for corporate, university and specialty-venue food supply chains. In 2007, Bon Appétit also pledged to lower the carbon footprint of its operations by 25 percent by 2010.

Here are some details on Bon Appétit’s “Low Carbon Diet,” according to a recent article from sustainability experts 3BL Media:

This means serving less food from animals that produce dangerous greenhouse gases, serving more low-carbon options such as vegetables, fruits and grains, and a program to compost kitchen waste and educate diners about food waste impact in landfills. Environmental Defense Fund lauded the company for the Low Carbon Diet in this YouTube video of its 2009 Innovation review.

Bon Appétit’s Web site lists the company’s sustainable sourcing policies, which are in effect throughout the company’s more than 400 dining facilities across 30 states.

“Developing an effective green strategy will involve changes to a company’s business design, and management will have a new set of guidelines for developing strategic goals, policies, processes and key metrics,” Richard Findlay, co-author of the Diamond Management & Technology report and a partner in Diamond’s Healthcare Practice, explained. “The starting point should be a quick, four-to-six-week assessment of the enterprise and, as we’ve seen, the end result can be tens of millions of dollars in annual savings.”

Earlier: Wal-Mart’s New Game-Changing Mandate

Resources

Staying Green While the Global Economy Sees Red (free registration required)
by Darin Yug and Richard Findlay
Diamond Management & Technology Consultants, Inc., April 21, 2009

Don’t Be ‘Green’ with Envy: Environmental Initiatives Should Lower Costs and Increase Competitiveness
Diamond Management & Technology Consultants, Inc., April 21, 2009

Sustainability Index
Wal-Mart

L’Oréal’s Commitment
L’Oréal, 2007

Embedding Sustainability Into Our Long-Term Targets
L’Oréal

TIME lauds sustainable food leader Bon Appetit Management Company
3BL Media, Aug. 20, 2009

Sustainable Food Service
Bon Appétit Management Company