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The Sustainable Supply Chain Summit 2012

22/10/2012 - 23/10/2012, London

Discover how to turn your company's social and environmental supply chain risk into new business opportunities. This 2 day Summit will bring together an expert line-up of speakers from Nike, Nestlé, Timberland, Akzonobel, B&Q and more to highlight how you can profit from new supply chain strategies

Green Industry Platform - Sustainable innovation springboard

A new UN public/private partnership hopes to deliver sustainable development by greening manufacturing industry

Take the leap

In spite of the widespread premonition that the June Rio+20 conference will probably both under promise and under deliver, a number of initiatives are in the pipeline that offer the prospect of positive change. One initiative particularly worth watching is the proposed launch of a Green Industry Platform, scheduled to take place in Rio de Janeiro on 16 June.

The platform, to be established by the United Nations Industrial Development Organisation (UNIDO) in partnership with partner UN bodies and the private sector, is intriguing for a number of reasons.

The objective of the platform – outlined recently in Vienna – is to create a framework where governments, business and civil society organisations can work together to drive progress towards “green industry”.

The platform would not only serve to share information and raise awareness about green industry policies and practices around the world but, importantly, would also help develop strategic road maps and partnerships for specific sectors, countries or regions.

Green industry in this context is broadly defined as manufacturing activities that increase material and energy efficiency, and at the same time reducing waste outputs and pollution, and creating green jobs.

More sustainable growth

Three premises lie behind the initiative, all of them seemingly well founded.

The first is that industrial development will continue to be the mainstay of global economic growth, particularly in the emerging economies. The choice now is not whether it will continue, but how.

In the absence of any purpose-built international organisation tasked with helping the manufacturing sector become green and lean, the platform could play a decisive role. It would be able to help both countries and companies to jump to the much talked about – but often poorly implemented – cleaner technologies and management practices.

The second is that current resource (and pollution) intensive business models cannot long continue. Apart from their well-documented negative social and environmental impacts, there are also growing business risks.

Some recent McKinsey Global Institute research, presented at the Vienna meeting, highlights the fact that competition for raw materials was increasing, and with it price, political and social volatility.

If developing countries continue to use 20th century technologies, they will not only be less competitive in the longer term but also reduce the chances of preventing dangerous climate change and alleviating social problems.

The third is that in many cases a strong business case already exists for the adoption of more resource-efficient practices by companies the world round. While cynics will argue that “green industry” is an oxymoron, the McKinsey studies suggest that significant efficiencies can be achieved using available technologies.

Innovation and transition

As the development of renewable energy and cleaner chemistry technologies have demonstrated, sustainability concerns are already driving rapid industrial innovation.

Indeed, if the world is to make the transition to the green economy that many experts consider the only way of delivering sustainable development and alleviating poverty, green industry will be the primary motor of change.

While the exact operating details of the platform remain to be defined, it will have a number of interesting features.

While participation in the platform will be voluntary, signatory organisations will subscribe to a common “statement of support”. Now open to signature by governmental, business and other organisations, this outlines shared objectives and commitments, and describes some of the ways that green industry will be promoted. Recognising the importance of SMEs in global supply chains, companies of all sizes – and from all countries – will be encouraged to join.

To ensure it has the necessary political profile and momentum, the platform will be driven by ministers and chief executives at the broad policy and programme level. An executive level governing body will be tasked with approving the platform’s programme of work and, importantly, reviewing progress.

Too many initiatives?

The platform, however, faces a number of very real challenges.

Businesses are frequently presented with grand new UN initiatives (eg the Millennium Development Goals) and policy frameworks (such as the UN Guiding Principles on Business and Human Rights), but without the necessary supporting regulations and incentives to assist implementation.

Often the business case for action is not well articulated and the UN system is not geared for taking speedy decisions or liaising with business.

Inevitably, the Green Industry Platform will be seen by many in business through this lens. Its main task now should be to get on board the critical mass of government and business leaders needed to assure its place in the firmament of international public/private partnerships.

Early indications, however, are that a credible number of companies from all parts of the world (as well as nation states) support the platform’s goals and will sign on. From CEOs and business associations there is a sense that this is an idea whose time has come, at least on a trial basis. The involvement of business in the governance process is also seen as a new and positive development.

Next, the challenge will be to ensure the necessary strategic focus and resourcing, thereby minimising the risks of over promising and under-delivering. Green industry will not be achieved by diktat.

Innovation is almost impossible to achieve alone. Here, partnerships offer great potential. They succeed or fail, however, on their ability to both mobilise engagement and to deliver measurable mutual benefits.

Green Industry Platform signatories and observers alike will doubtless all be looking to assess just how well the platform achieves these goals.

Paul Hohnen is an Amsterdam-based consultant who advises, speaks and writes on global sustainable development and CSR issues. Among his affiliations he is an associate fellow of Chatham House and a member of the Ethical Corporation advisory board. For more info visit here.

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