Sustainability theory and practice. Sustainable supply chain management attempts of GlaxoSmithKline

Submitted Assignment , 2019 , 16 Pages

Business economics - Supply, Production, Logistics

Report on sustainable supply chain management attempts to integrate environmental, economic and social issues into normal supply chain practice. Defining the word sustainability is somewhat hard as it contains several characteristics depending on the point of understanding. Though, looking at the word beginning, sustainability is obtained from the Latin word “sustinere” which literally means “to hold up”. When looking up in various vocabularies, sustainability has the denotation of “preserve”, “support” or “endure”.

Business sustainability is called as the management of the triple bottom line, it is a process by where corporations control their economic, social and environmental risks, responsibilities and prospects. Furthermore above 3 impressions are occasionally mentioned as people, planet and profit. Nevertheless, this method depends on an economical perception and do not entirely imprisonment the time component which is essential inside a sustainable business.

Table of Contents

1 Answer Section 1
1.1 Sustainability Literature Review
1.2 Sustainability as a Concept in Business
1.3 Supply Chain Sustainability in GlaxoSmithKline
1.3.1 Environmental Sustainability in GlaxoSmithKline
1.3.2 Reducing Water Impact & Waste

2 Answer Section 2
2.1 Sustainability in Supply Chain Developing
2.2 Social & Economic Sustainability for Business
2.2.1 Developing Talent
2.2.2 Protecting People (Health & Safety)
2.2.3 Ethical Conduct

3 Answer Section 3
3.1 Conclusion and Recommendation

4 Answer Section 4
4.1 Reflective Appraisal

5 References

Table of figures

Figure 1 Triple Bottom Line

Figure 2: Direct Operations - Indirect Operation

Figure 3 : Employee Policy Violation

Figure 4 : Reflective Practice

1 Answer Section 1

1.1 Sustainability Literature Review

Defining the word sustainability is somewhat hard as it contains several characteristics depending on the point of understanding. Though, looking at the word beginning, sustainability is obtained from the Latin word “sustinere” which literally means “to hold up”. When looking up in various vocabularies, sustainability has the denotation of “preserve”, “support” or “endure” (Rezaee, 2018).

Business sustainability is called as the management of the triple bottom line, it is a process by where corporations control their economic, social and environmental risks, responsibilities and prospects. Furthermore above 3 impressions are occasionally mentioned as people, planet and profit. Nevertheless, this method depends on an economical perception and do not entirely imprisonment the time component which is essential inside a sustainable business.

Abbildung in dieser Leseprobe nicht enthalten

Figure 1 Triple Bottom Line (Author)

Business sustainability means the capacity to overcome difficulties overtime where they can survive problems because a business is closely interconnected social, economic and environmental systems. If the business is sustainable it can create financial value and can contribute to a health and strong society. (Times, n.d.).

1.2 Sustainability as a Concept in Business

According to the UN Department of Economic and Social Affairs (Affairs, 2015) sustainable development is a progress that “meets the needs of the present without compromising the ability of future generations to meet their own needs.” so for a business to be more successful and sustainable, it should report the macro level problems such as;

- Economic problems (Ethical conduct, wealth)
- Social problems (health & safety, employee well-being)
- Environmental problems (climate change, biodiversity.)

It is important to understand that how sustainability can generate value to a business organization also in the entire supply chain, there are several best practices that can lead to sustainable business model, also it helps workers in the organization to become zero to hero.

1.3 Supply Chain Sustainability in GlaxoSmithKline

GlaxoSmithKline PLC (GSK) is one of world’s leading Multinational Companies which develops Pharmaceuticals, Vaccines, Consumer Healthcare Products and Nutritional Products while improving the quality of human life. It started its operations on 1st of January 2001, following the merger of Glaxo Welcome PLC and SmithKline Beecham PLC even though their combined histories go back to the early 1715.

Company Vision

“The first and best fast-moving consumer healthcare company driven by Science and Values”

Company Mission

“Improve the quality of human life by enabling people to Do More, Feel Better and Live Longer” (Reuters, 2019).

1.3.1 Environmental Sustainability in GlaxoSmithKline

As a global healthcare company, GSK contribute to tackling effects and causes of climate change. Their focus on reduce water impact on their supply chain, reducing waste and focusing to reduce the releasing of carbon to the atmosphere.

- Goal – Reduce overall carbon footprint by 25% by 2020 (vs 2010)

GSK encouraged their suppliers to monitor and disclose performance through Eco desk. According to their supply chain operation they have classified the emission through 2 categories.

Abbildung in dieser Leseprobe nicht enthalten

- Challenge: GSK provide vaccines and medicine and consumer products all over the world around 160 countries, so it is really challenging to reduce the overall supply chain carbon footprint.

Abbildung in dieser Leseprobe nicht enthalten

Figure 2: Direct Operations (GlaxoSmithKline, 2017) Indirect Operation (GlaxoSmithKline, 2017)

Even though according to their latest stats, their 2016 Co2 emission is around 19.5 million tonnes, which is a reduction of 4.2 from their previous year. In 2017, GSK's direct operations carbon emissions were reduced by 2% compared to 2016.

In 2016, GSK reduced the CO2 emission from 18.7 million tons to 17.9 million tons of Co2 from previous year. however, compared to 2010 baseline target there was a 4% increase in the Co2 emission, this is solely because of the partnership with Novartis, which lead to increasing sales of propellant-based inhalers Ventolin, where propellant inhaler releases greenhouse gas during use (GlaxoSmithKline, 2017).

1.3.2 Reducing Water Impact & Waste

GSK have two goals committed to reduce the impact of water and waste in the environment.

- Goal 1 - Commitment to reduce water impact across the supply chain by 20 % by 2020 (vs 2010).
- Goal 2 - Reduce their supply chain operational waste by 50 % by 2020 (vs 2010).

GSK reduced water usage by 22% since 2010 but water consumption increased by 1 % in 2017, due to the growth of Vaccines business worldwide.

Example, In South Africa. they reduced water consumption by 9%, running campaigns to encourage workers to save water during work and at home during a drought. Furthermore, in UK GSK is doing campaigns to encourage consumers to turn off the tap when they brush their teeth.

GSK measure their water impact across four different categories, water shortage, local water quality, health and social risks because waste water pollution is arising problem in pharmaceutical industry there is a risk where antibiotics releasing to the environment through waste water.

In 2017, GSK completed water risk assessment again above four categories covering all the sites in their supply chain. These sites now developing process to address those risks that have been identified through risk assessments.

One of their major product "Horlicks' manufacturing makes almost 30 % of water footprint globally. Over the last 5 years they have accessed their top suppliers of water, milk, malt and wheat in India and implemented projects to recharge over 200,000 m3 of water per year. Furthermore, they have created water stewardship policy where they focus on four areas.

Table 1: Environment Sustainability Aims

Abbildung in dieser Leseprobe nicht enthalten

GSK has commitment to reduce operational waste by 50% (vs 2010) by 2020, since 2010 till now they reduced it by 23%, however the amount of waste produced was not reduced in 2017, it’s the same as the previous year to overcome the situation they are trying to reclaim the waste and recycling it to reuse. They are redistributing consumer products close to their expiry date in United Kingdom and selling waste gelatine to paintball manufacturing. Till now around 70 % of sites achieved zero-waste.

2 Answer Section 2

2.1 Sustainability in Supply Chain Developing

Supply chain management is the active chain that seeks to maximize customer satisfaction and to create a sustainable modest benefit. Its major aim is to increase effectiveness and efficiency of the entire organization. In today's developing world increasing economic growth, material and energy consumption are causing environmental, social and economic problems, due to this situation it is necessary to integrate sustainability into supply chain management activities.

For business organizations it is important to robustly monitor their supply chain operations towards to do more sustainable and environmentally friendly business to gain competitive advantage, to reduce costs and to aid the environmental sustainability (Alzawawi, 2014).

Companies are now partnering with Global organizations to become more; transparent to make their supply chain robust. Companies trying to understand the human cost of the business to sustain their business in future. As responsible global healthcare company GSK follows frameworks which created by United National Global Compact, ISO and Global Reporting Initiative (GRI).

[...]

• Course: MSc Project Management
• Author: Luxmi Kanth Navaneethan (Author)
• Publication Year: 2019
• Pages: 16
• Catalog Number: V538254
• ISBN (eBook): 9783346135810
• Language: English
• Tags: Sustainability, Project Management, Case study, Glaxosmithkline, supply chain management, environment, economic, social, Corporate Social Responsibility, CSR