Environmentalism at the core

Firms should consider creating green supply chains rather than following a few environmental practices

September 25, 2020 12:49 am | Updated July 06, 2022 12:21 pm IST

The United Nations Millennium Development Goals and the World Bank Group’s global practices have recognised sustainability as an essential issue of global importance. Economic, social and other forms of sustainability have evolved over the years, but it is environmental sustainability that has gained significant popularity.

Environmental sustainability is understood as buying greener products, avoiding hazardous materials, energy optimisation, and waste reduction. While some firms are still reluctant to engage in environmentally beneficial activities as they are afraid to compromise on the economic benefits, some others have positioned environmental practices at the forefront due to legislation, and industry and government commitments. In several firms, high importance has been given to environmentalism due to compelling regulatory norms, and a potential to manage costs, risks and optimise eco-friendly practices. However, in this process, organisations, especially in the manufacturing sector, get so serious about the low-hanging fruits of waste reduction and energy efficiency improvements that they fail to recognise the need for restructuring their learning imperatives and see the big picture of environmentalism. While government norms, organisational policies and corporate environmental responsibility projects drive environment-friendly practices, these are merely short-term actions towards environmental sustainability.

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Long-lasting benefits

Only through organisational learning can people be urged to work towards long-lasting benefits. In this context, green supply chain practices are useful. These include green procurement, green manufacturing, green distribution, and reverse logistics. With practices starting from acquisition of eco-friendly raw material to disposal/ reuse/ recycle of used products,employees, suppliers, distributors, retailers and customers will be able to integrate environmental concerns in the daily operations of a firm. Thus, green supply chain practices enable organisational learning in environmental sustainability.

Our research, based on a survey of 220 respondents across 21 manufacturing units in India, points to the inter-linkages between green supply chain practices, organisational performance and learning. We found that these inter-linkages not only lead to a long-lasting natural drive towards environmental performance, but also to higher economic performance . Research shows that the positive impacts of environmentalism can only be felt in the long term when they get embedded into organisational learning systems through green supply chain practices. The resultant learning system smoothens the knowledge flow in the organisation and help firms to strategise for better performance, bearing in mind the environmental aspects. This further promotes environmentalism across all players in manufacturing supply chains. Thus, environmental sustainability is ensured from the source (willingness) and not through force (regulations).

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Understanding links

Drawing linkages between green supply chain practices, corporate environmental performance, corporate economic performance and the dimensions of learning organisations in firms is necessary for an organisation’s progress and environmental protection in society. Understanding these inevitable links will enable managers and experts to shape their organisational values, work practices, and performances for the greater good of society.

We infer that when the different players of a manufacturing supply chain realise the inherent benefits associated with organisational learning dimensions, their drive towards environmentalism increases. Policymakers should support this thinking by not merely imposing environmental practices as regulatory norms but by emphasising on the creation of green supply chain-based learning systems in manufacturing.

Vijaya Sunder M. is Assistant Professor of Practice in Operations Management at the Indian School of Business, Hyderabad

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