Sustainable Supply Chain- Method and Practice

Delivering Sustainable Value

RSM GC Advisory Services Pvt. Ltd. 5th floor, Great Social Building 60, Sir Pherozeshah Mehta Road, Fort Mumbai, Maharashtra 400001, India

Agenda
Global Compact and other Methods for Managing Sustainable Supply Chain RSM GC Customized & Hybrid Method
Case study of Auto Supply Chain

www.general-carbon.com

Global Compact

and other Methods

for Managing

Sustainable Supply
Chain

www.general-carbon.com

Iterative Approach to Developing Your Sustainable Supply Chain Strategy

Supply Chain Sustainability- a Practical Guide to Continuous Improvement

www.general-carbon.com

Iterative Approach to Developing Your Sustainable Supply Chain Strategy

Typically deployed to develop and deploy strategy

www.general-carbon.com

Supply Chain Sustainability- a Practical Guide to Continuous Improvement

COMMIT
Develop the business case by understanding the external landscape and business drivers. Establish a vision and objectives for supply chain sustainability Establish sustainability expectations for the supply chain.

DEFINE and IMPLEMENT

Communicate expectations and engage with suppliers to improve performance. Ensure alignment and follow up internally. Enter into collaboration and partnerships.

ASSESS
Determine the scope of efforts based on business priorities and impacts.

MEASURE and COMMUNICATE

Track performance against goals and be transparent and report on progress.

Very useful in developing and deploying processes and practice

www.general-carbon.com

RSM GC Customized & Hybrid Method

www.general-carbon.com

RSM GC Method and Practice Sustainable Supply Chain

RSM GC adopts methodology customized to each client situation
Elements are drawn from GC & BSR and Iterative Strategy Models RSM GCs SSC practice successfully deployed Segment, Scope and Engage model successfully The model is simple and is a first step which can upgraded easily to GC&BSR or Iterative Strategy approaches.

www.general-carbon.com

Segmentation- Recognizing Differences

Supplier Control Levels
Control Level Guidelines

Level 1
Level 2 Level 3 Level 4

No impact on CSR & compliance, no impact on production

Low impact on CSR & compliance, no impact on production Low impact on CSR & compliance, indirect impact on production Some impact on CSR & compliance, direct impact on production Alternative supplier available Some impact on CSR & compliance, direct impact on production Alternative supplier not available, major problems maintaining production
9

Level 5

www.general-carbon.com

Replaceability

High

Risk
High Low

Low Low Low

Opportunity
High

Dependency
Segmentation- Recognizing Differences
www.general-carbon.com

High

Scope & Engage

Compliance

Certification of adherence to mandatory standards; Certification of adherence to customer-specific standards; Monitoring of planned new regulations

Material flows; Energy; Logistics; Business Processes

Optimization

Re Design

Regionalization of procurement and production structures; Hub strategies in the distribution network; Closed-loop supply chain management ;Re-assessment and substitution of suppliers and logistics service providers; Business Process Reengineering (BPR)

Innovation

Innovation management for new products and supply chain services; Price differentiation for premium, sustainable supply chain services and products; Design for logistics (product and packaging);

Progression

Funding research institutions and research projects and surveys; Funding of relevant NGOs ; Active involvement in associations ; Establishing knowledge exchange platforms

www.general-carbon.com

11

Scope & Engage

Tools for engaging with suppliers on sustainability

Deep Engagement

Partnership
Support supplier ownership to address the root causes of poor sustainability performance.

Remediation & Capability Building

Ask suppliers to address issues of poor performance. Provide training, resources, and support to improve sustainability management and performance.

Broad Engagement

Monitoring & Evaluation

Ask suppliers to self-assess their sustainability performance. Conduct on-site evaluations of performance

Setting Expectations
Communicate about your sustainability expectations to suppliers. Incorporate expectations, including the code of conduct, into contracts.

www.general-carbon.com

12

Agenda

Case study of Auto Supply Chain

www.general-carbon.com

Details of Actions in Auto Supply Chain

Communication
Communicated expected environment and social compliance conditions and systems for quality, safety, energy, water and materials Required self attestation

Contract Condition
Inclusion of Environmental and Social compliances in the contract conditions

Hand Holding for compliance & performance improvement

Mapping the applicable compliance conditions (for different sets of suppliers) and opportunities for performance improvement Capacity building for compliance and performance improvement
www.general-carbon.com

14

Some more detail of Actions in Auto Supply Chain

Hand Holding for compliance & performance improvement
Mapping the applicable compliance conditions and opportunities for performance improvement

Monitoring & Audits

Compliance Monitoring plan for each supplier and generic performance improvement agreement Annual Audits Capacity building for compliance and performance improvement

www.general-carbon.com

15

Some more detail of Considered Actions in Auto Supply Chain

Process optimization
Training of truck drivers Simple re-design of packaging or optimized packaging processes Implementation of environmental management systems, to standardize processes and to reduce unnecessary complexity costs. Consolidation of material flows by re-scheduling Route optimization and transport planning Business process optimization to reduce lead times, which enable longer planning cycles, which in turn create more consolidation possibilities Applying intermodal transport Applying fleet management systems Energy management in warehouses
www.general-carbon.com

16

Some more detail of Considered Actions in Auto Supply Chain

Redesign
Regionalization of procurement and production structures Hub strategies in the distribution network Closed-loop supply chain management Re-assessment and substitution of suppliers and logistics service providers Innovation management for new products Design for logistics (product and packaging) Training and education Knowledge and best practice platforms Carbon footprint labels on products and services

Innovation

www.general-carbon.com

17

Some Lessons
In the case supply chain compliance is still a major issue even, with large and critical suppliers Compliance management actions had to be graded much finer than communication, codes & inclusion in contracts, capacity building and Audits- compliance itself was graded in three levels Process optimization assistance ( Energy & Logistics) has become an incentive for compliance Knowledge & Best practice platforms were well received Cost and benefit sharing was often set aside keeping in view it can be contentious Collaboration amongst major auto sector players was found essential to deal with common suppliers
www.general-carbon.com

18

Replaceability

Contract Condition Communication Handholding Monitoring and Audits

High

Handholding Monitoring and Audits

Handholding & Process Optimization

Contract Condition

Low

Handholding & Process Optimization

Partnership & Innovation

Risk
High
*Contract Condition

Low
Contract Condition

Low Low
Process Optimization

High

Opportunity

Partnership & Redesign

Handholding Monitoring and Audits

Handholding Monitoring and Audits

Dependability

High

Partnership & Redesign

Partnership & Innovation

What we did with Auto Supply Chain?

www.general-carbon.com

About Us Delivering Sustainable Value

www.general-carbon.com

 RSM International is the 7th largest network of independent audit, tax & advisory firm in the world with over USD 4 billion in fee income and presence in over 700 offices in 103 countries RSM Astute is the 6th largest accounting and consulting group in India has 1000 people strength and located in 19 offices in 13 cities with delivery capabilities in 90+ cities Some Clients of RSM Astute

www.general-carbon.com

Some RSM GC Clients for Energy and Sustainability Service Offerings

www.general-carbon.com

Some more clients..

www.general-carbon.com

23

Thought leaders & Press coverage

Carbon market Carbon Finance, London

Point Carbon Americas, NY

Point Carbon, Amsterdam Africa Carbon Forum, Kenya REC Conclaves across India Euromoney Renewable energy finance conference Renewtech India EU Chambers of Sustainable Development & Yes Bank Cleantech Hydro Power Convention

Renewable energy

Clean technology

www.general-carbon.com

Team Profile
Rambabu Paravastu, Ph D, CEO Dr. Rambabu has been a thought leader in the Asian Sustainability and Climate Change movement, his previous roles include Managing Director at CantorCO2e Asia and Head of Sustainability and Climate Change practice at PricewaterhouseCoopers, Asia. Dr. Rambabu has over 25 years of experience in consulting, research and teaching in governance, sustainability, and climate change. He has led over 200 assignments sponsored by the Ministry of Environment and Forests (MoEF), Ministry of Science and Technology (MoST), World Bank, UNDP and various national and international organizations.

R P Sharma (RP), Director New Delhi RP holds a masters degree in Chemical Engineering with 36 years of experience in the field of energy and environmental management. He has worked in past for Hindustan Zinc Limited, Triveni Engineering Works Ltd, Hindustan Dorr-Oliver Ltd, Tata Steel & CantorCO2e. He has been the Chief of Environmental Management in Tata Steel.

www.general-carbon.com

Team Profile
Betsy Vincent, Vice President Betsy has 12 years of experience with the corporate and nonprofit sectors. Betsy has worked with Bennett Coleman & Co. & International Resources for Fairer Trade(nonprofit institution) she was responsible for marketing of the fair trade concept, fund raising, training, and business development services. She has also developed GHG emission reduction projects in the community and agriculture sector. Betsy holds a Masters degree in Management Studies. She has extensively worked with communities across India.

Akash Mokhriwale Manager Akash holds a post graduate diploma in Industrial Safety & Environmental management(PGDISEM) from NITIE and Bachelor of Engineering(Electronics & Communications). Akash has collective work experience of over 3 years, designing safety systems in plant engineering, energy and environmental management. He is also a certified internal auditor for OHSAS 18001:2007.

www.general-carbon.com

Growing with clients , Partnering at all stages of business ,Handholding to address Energy, Environment and Social functions
Business Excellence Performance Improvement

Sustainable Business

Compliance

www.general-carbon.com

Our Service Offerings

Sustainability Energy CSR Companies Act 2013 Energy Audit / Energy Environmental and Social Management Systems [ISO Assessments 50000) Carbon and Water Foot printing & Renewable Energy Purchase International Certifications [ ISO, Obligation (RPO) / Renewable CDP ] Energy Certificate (REC) Advisory Carbon Credits [CDM, VCS, PoA, and Trading GS] PAT Advisory and ESCerts Trading Business Responsibility Reporting RE Power Contracting and Trading [Under SEBI Regulations] Sustainability Reporting[GRI etc. ] 28 Sustainability ERP Tools and www.general-carbon.com

http://www.linkedin.com/company/general-carbon -https://twitter.com/GC_Advisors

Thank You

www.general-carbon.com http://www.linkedin.com/company/general-carbon
www.general-carbon.com

https://twitter.com/GC_Advisors
29