Ecologically sound value chain innovation on corporate strategy agendas

Monday, January 05, 2015

By Cassandra Oaten

A growing public and private demand for environmental development that looks at sustainable value chain improvement of existing products is being pushed on manufacturers across industries. Multilateral organisations are also working in this space although classifications notably differ according to which multilateral report you’re reading.

In Gunter Pauli’s book, The Blue Economy (2010), Pauli calls on more innovators and businesses to utilise technology to improve the sustainability of existing systems and products. Readers were drawn to the “100 million jobs” that could be created if all proposed environmental improvements to existing products and their value chains were actioned. Suggestions included new uses for by-products, creating additional value. Pauli entitled the book The Blue Economy due to the landscape spectral dominance of blue in the sea and sky.

The same area of work was named the ‘green economy’ in the United Nation’s 2012 Rio+20 Conference on Sustainable Development. The ‘blue economy’ in his fora was a separate clarification coined by Pacific Small Island Developing States (PSIDS) to distinguish their specific concerns centred on the sustainability of   marine ecosystems.

Categories are also split in APEC circles where Ocean and Fisheries; and Sustainable Development are located in different working groups. In APEC sustainable development is defined as protecting the “quality of our air, water and green spaces” (2015, APEC Secretariat) and natural resources.

The list is growing of corporates reacting to consumers growing sustainability demands. Vexed by past consumer indignation Nike Inc. has highly publicised its focus on sustainability by mapping its value chain footprint. It created targets from a NIKE Materials Sustainability Index (NIKE MSI) including measured reductions in footwear waste compared with traditional production methods in parts of their products by 80%.

Whether classifying sustainable development as ‘green’ or ‘blue’, both terms and their wider use signify a push for economic growth to be facilitated in an environmentally responsible manner. Under either classification, service providers who can appeal to customers growing environmental concerns in their products or use of suppliers will find gains in attracting and retaining customers.