As businesses around the world face increasing pressure to adopt sustainable practices, the supply chain has emerged as a critical area for inclusion. Environmental, Social and Governance (ESG) principles. A green supply chain minimizes environmental impact by promoting social responsibility, enabling companies to reduce emissions, increase resource efficiency and ensure ethical sourcing.

This approach mitigates the risks associated with climate change and resource depletion and strengthens a business's reputation. It attracts environmentally conscious consumers and caters growing investor expectations and regulators.

According to one 2023 reportover 70% of supply chain professionals see sustainability as essential to their operations, underscoring its strategic importance. World Economic Forum further shows that effective supply chain management is critical to achieving broader ESG objectives, as it enhances brand reputation and customer loyalty. In today's business landscape, building a green supply chain is a strategic step toward long-term growth and resilience.

Challenges in building a global green supply chain

Building a global green supply chain presents multifaceted challenges, especially in achieving visibility and transparency in supply chain functions. According to EYmany organizations struggle with fragmented digital adoption, as 22% of supply chain executives rely on basic tools like email and spreadsheets, while only 42% have begun to adopt cloud-based platforms.

This lack of integration prevents real-time data sharing, which is essential for tracking environmental impact and aligning with sustainability goals. Furthermore, the transition to decarbonisation and net zero targets is complicated by economic constraints, with businesses often faced with competing ethical and economic objectives.

Securing investments in green technologies can be challenging, as these initiatives require significant upfront costs that can disrupt existing value chain goals such as cost reduction and efficiency. Furthermore, the lack of uniform standards in international markets exacerbates the complexity of compliance, especially for multinational corporations that manage different resource strategies and different environmental regulations.

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How to implement sustainable practices throughout the supply chain

A truly green supply chain relies on technology to drive sustainable practices from source to delivery. Walmart exemplifies this with its advanced digital capabilities that match operational efficiency with environmental responsibility.

Using AI-driven predictions, Walmart minimizes congestion, reducing energy use and waste in its supply chain. The company's blockchain technology tracks the origin, freshness and environmental impact of its food products, driving transparency and sustainability across its supplier network.

Walmart has also tested electric trucks and refrigerated trailers to reduce emissions, demonstrating how innovative logistics contributes to its goal of net zero emissions by 2040. These efforts illustrate how technology enables businesses like Walmart to meet the goals of sustainability while maintaining a competitive advantage.

Similarly, my company, ATREnew, a large recycling and e-transaction platform in China, focuses on reducing its carbon footprint using smart systems and digital management for simple recycling and green storage. It also fosters a sustainable supply chain with upstream and downstream partners.

This approach enables us to reduce material consumption by optimizing waste management processes, proving that operational efficiency and environmental responsibility can go hand in hand. These examples highlight how businesses can reduce the environmental impact of their supply chains by using cutting-edge technology.

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Tracking emissions and waste in the supply chain

To advance green supply chain practices, businesses are increasingly using technology to track emissions, energy use and waste.

DHL, for example, uses it GoGreen dashboarda sophisticated data platform designed to measure carbon emissions across logistics activities, including warehousing, packaging and shipping. The dashboard uses advanced analytics to identify carbon-intensive areas, enabling DHL to optimize delivery routes, switch to energy-efficient vehicles and propose actionable strategies to reduce emissions.

This tool enhances internal sustainability efforts and provides partners with transparent sustainability metrics, fostering shared accountability. By adopting data-driven strategies, businesses can more accurately monitor their environmental performance and take immediate corrective action to meet sustainability standards.

Circular economy and waste minimization

Technology is a key enabler for businesses adopting circular economy principles, facilitating waste reduction and material reuse through innovative systems. Digital tools, such as IoT sensors and AI-driven platforms allow companies to monitor resource usage, identify waste hotspots and streamline recycling processes. Automation in areas such as sorting and quality inspection ensures efficient material recovery, while blockchain technology enhances traceability, ensuring that recycled or reused materials meet quality and ethical standards. For example, businesses in the recycling sector are increasingly using advanced algorithms to align recycling standards with changing market needs, improving resource recovery rates.

Related: Sustainability in the supply chain is the need of the hour

CONCLUSION

The journey to a green supply chain is both a challenge and an opportunity. By incorporating the latest technology in operations, surveillance and waste management, businesses can address environmental concerns while achieving cost efficiencies and competitive advantages.

Integrating ESG principles into supply chains empowers businesses to align profit with purpose, whether through AI-driven forecasting, IoT-enabled monitoring or digital recycling systems. As consumer and regulatory demands for sustainability increase, businesses that invest in green supply chains will not only thrive in the marketplace, but also contribute to building a more sustainable future.