In the 1960s, the world found itself facing an environmental renaissance, a period charged with activism and an escalating awareness of the planet’s vulnerability, particularly to the of industrialisation.
This ignited concerns over the finite nature of raw materials and energy resources and spurred a push for innovations to mitigate the environmental impact of production and forecasted future resource availability and consumption – compelling large businesses to reevaluate their operational footprints and embrace sustainability across their respective supply chains.
In 1969, researchers initiated a groundbreaking internal study for an international beverage company based in the United States. The study compared various beverage containers to identify the one with the lowest environmental impact and minimal resource depletion. The analysis included the quantification of raw materials and fuels used in the manufacture of each container type, alongside the environmental emissions associated with their production processes.
Widely recognised as the first-ever corporate Life Cycle Assessment (LCA) undertaken, this study laid the cornerstone for the methodologies and practices that define the field today – which is becoming more prominent as the sustainability discourse starts to pivot towards the principles of circular economies.
The impact of LCAs in a circular economy
According to the Circularity Gap Report for 2023, merely 7.2% of materials are recycled back into the global economy post-use, indicating that over 90% of materials end up wasted, misplaced, or remain inaccessible for future reuse. The report found that through the adoption of a global circular economy just 70% of the materials currently extracted would need to be utilised to meet human demand. This would cut global material consumption by a third and offer a clear path towards reversing the trend of overconsumption or exceeding “planetary boundaries” i.e., needing more than “one earth” to fulfil our current needs. Currently, we are consuming more resources than the earth can provide. This means that civilisation effectively needs the resources of more than one earth to sustain itself at its current consumption pace. One of the ways in which we can address this is through expansion of the circular economy.
To achieve this goal, one of the tools businesses can use to scientifically manage the circularity of their supply chains is the LCA methodology.
LCAs serve as both a lens and a lever, offering a comprehensive view of the environmental impacts of products and processes from “cradle to grave”. This deep dive into the life cycle of goods – spanning material extraction, production, use, and disposal – reveals hidden environmental risks, facilitates informed decision-making, and fosters the development of robust sustainability strategies while avoiding the shifting of burdens from one lifecycle stage to another.
It empowers businesses with the precision needed to pinpoint and prioritise their sustainability efforts, ensuring that resources are allocated to where they will deliver the most substantial environmental benefit. The data and insights derived from LCAs can also act as a springboard for innovation, inspiring the development of new materials, products, and processes that are less harmful to the environment. This push towards innovation not only helps in minimising the ecological footprint of businesses but also often leads to cost savings and enhanced market competitiveness.
As awareness and demand for sustainable products continues to rise amongst consumers, businesses across Sub-Saharan Africa and globally, are increasingly turning to LCAs to meet this call to action.
One example is CHEP, a global supply chain solutions company that provides pallet and container pooling services and offers a share-and-reuse model for its 500 million+ pallets, crates, and containers serving the FMCG, fresh produce, beverage, retail, automotive, and general manufacturing industries.
CHEP leverages LCAs, a leading circular measurement tool, to evaluate the environmental benefits of its share-and-reuse solutions, thereby assessing progress in alignment with its customers’ sustainability and circular economy goals. Independently conducted using ISO 14044 and ISO14040 LCA methodologies, CHEP examines how much raw material is required, how much CO2 is produced, and how much waste is generated from production, repairs, transport, and reuse, until the product is no longer viable and is sent for recycling.
However, the journey towards sustainability extends beyond the efforts of individual businesses; it necessitates a collaborative approach across the entire supply chain, from suppliers to manufacturers, and all the way to customers and ultimately consumers.
Sustainability through collaboration
There’s a growing trend among companies conducting LCAs to propagate this culture of sustainability through their supply chains, incentivising and recognising the efforts of their partners and customers by offering sustainability or environmental certificates.
Sustainability certificates offer multifaceted benefits, enhancing trust and collaboration between companies and their partners by showcasing and acknowledging tangible achievements in circular processes and environmental impact reduction.
These certificates quantify savings in natural resources, carbon emissions reductions, and waste elimination, providing a credible foundation for companies to demonstrate their commitment to sustainability and avoid perceptions and accusations of greenwashing. Additionally, they support compliance with increasingly strict regulations, aiding in sustainability reporting and helping meet corporate environmental targets.
For example, CHEP’s sustainability certificates quantify the environmental advantages of its circular model for customers by calculating the carbon emissions, waste, and material savings over typical single-use or one-way alternatives. The company issued 1813 sustainability or environmental certificates to customers across its global operations in the 2023 financial year.
In 2023, CHEP’s South African customers who earned the sustainability recognition certificates, collectively reduced their CO2 emissions by 28,330 tonnes, saved 118 386 trees, saved 114 177 litres of water and reduced 24 610 tonnes of waste by using the company’s extensive and industry leading share-and-reuse pooling services.
The business imperative
The journey from the emerging stages of environmental activism to the sophisticated application of Life Cycle Assessments in today’s business practices showcases a paradigm shift in how we perceive and interact with our planet.
The real breakthrough comes when businesses start to embrace sustainability as a strategic driver for growth, efficiency, and profitability in the supply chain.
This will require businesses to critically assess the environmental performance of their materials, manage material control without compromising customer value, identify products that are suitable for inclusion in a circular economy, and equitably share the rewards with partners engaged in this sustainable economic framework.
Collaborating to create more sustainable, and ultimately regenerative supply chains, is an important way in which business can secure a winning position within the marketplace.
