Episode #65 Transcript | Sustainability in Supply Chains

Episode #65 Transcript | Sustainability in Supply Chains

[00:00] Radu Palamariu:

Hello and welcome to the leaders in supply chain podcast, I am your host Radu Palamariu and Managing Director of Alcott Global. Our mission is to connect the supply chain ecosystem globally by bringing forward the most interesting leaders and topics in the industry, and I am happy to have with us today Alexis H. Bateman is a Research Scientist, MIT Center for Transportation & Logistics and the Director of MIT Sustainable Supply Chains Organization. She has over fifteen years of experience in sustainability in the public sector, industry, and academic settings. Her work focuses on supply chain sustainability through research, education, and outreach. She has engaged closely with industrial partners, public agencies, global governance organizations, and non-government organizations. And also today we’re having Sheri Hinish is known as the “Supply Chain Queen.” Recognized as an IBM Futurist, 2019 Supply & Demand Chain Executive “Pro-to-Know,” and who is among one of the most active and interesting people to follow on LinkedIn. So definitely do that on the topic of sister sustainability and supply chain. Sheri is also a strong advocate for a sustainable supply chain for the circular economy through her sharing, knowledge and case studies that are pushing a lot to that agenda. So, it’s my pleasure to have and welcome both Alexis and Sheri to the podcast and thank you for taking the time. So, it’s my pleasure to have and welcome both Alexis and Sheri to the podcast and thank you for taking the time.

[01:29] Alexis H. Bateman:

Thanks for having us.

[01:30] Sheri Hinish:

Yes, thank you.

[01:32] Radu Palamariu:

Super. Let’s start maybe by quoting a little bit the work of Professor Yossi Sheffi, who is the Dean of the transportation and logistics side of MIT, and he had come out with a book recently on the sustainability topic, and he was arguing that sustainability is not necessarily a simple case of profits versus planet, but It’s a little bit of a more subtle issue off some people versus other people, and what he was mentioning in the book was that those looking for jobs and inexpensive goods are parts of our society. And of course, that part of our society obviously is less interested, maybe in sustainability, more interested in the price, whereas the other part of our society maybe is looking more at the environment future and making it sustainable. So, I guess the first question to kick start the discussion is, how far should we go with sustainability? And also, how would you integrate that in the corporate framework? But you have cutting costs, you have been reducing risk, and you have obviously achieved the growth as criteria for measuring a company.

[02:48] Alexis H. Bateman:

Great. Yes, I’ll kick off that one and have worked with Professor Sheffi for many years now, and I worked together with him on that book on the balancing green book. So, it was a great journey to talk to many companies over the years that we researched that book, literally hundreds of different coming companies and so many different professionals that work across the supply chain in different areas. And I think it became clear along the way exactly as he phrases in that book, that it was never really people versus the environment. At the end of the day, everyone has certain needs that they need to meet. They have things that they need in their lives to feed their kids and run their daily lives, and it became clear that it wasn’t really so much like these evil corporations that a lot of people want to set out and attack. But It was never like that. It’s people versus people. I think to learn that perspective really changed how to examine it because companies inherently producing a good that someone wants. And that is something that they’re going to use, whether being a business to a business area or a business to consumer scenario and there’s a demand for that. And so it’s not them setting out to impact the environment or impact, social environment negatively. It’s really them providing a service or a good to the consumers. And so once we really tried to change the perspective and Professor Sheffi brought that perspective, those easier to look at how things could be changed when you’re trying to change the conversation this today. Okay, this is you know, we’re working within this context of providing these services and goods for people who are demanding them. How can we shift the perspective? It’s really, the corporations or the others, setting out to impact the environment negatively when that’s never the intention. It’s really that we’re trying to provide a good and maybe something. Things get impacted along the way. So I think one starting off and putting out, conversations and talking between players. And we’re seeing that you know, with so many different companies. And of course, all the big, very public cases of the Unilever’s and the Starbucks and Proctor and Gamble’s that are now instead of, being very controversial with the NGOs and other groups that are criticizing their actions, their instead kind of partnering with some of these groups and partnering with the people that are looking at them and kind of criticizing how they’re operating. And, so I think there’s a shifting dialogue where it’s not this, adversarial scenario anywhere. It’s about hearing all the stakeholder voices and hearing why they maybe some NGOs, have a certain perspective of how a company is impacting the environment. They now have brought that informed perspective to the company, and they can wait it out and in their decision-making in their future strategy. And, so I think taking that different perspective has allowed more constructive conversations to say, what are the voices? Were the stakeholders that are being impacted? How can we take into all these different account and while it’s still far from perfect and there’s a long journey to go that I think when a company can start to think about those stakeholder voices and then also look into how this might impact their bottom line make it strategic not just about taking into stakeholder account and if you can do it in the right way and it becomes an economies of scale issue where many different companies are joining into this issue of sustainability, whether we’re talking about circular economy or end of life products or getting transparency, traceability of stream. The more companies do it, and the more they adopt those practices more, they adopted enabling technologies that it’s going to bring down the costs. It’s going to, allow companies to reduce their risk and really, achieve the goals of growth If they, if the more companies kind of come on to this mission. That’s really my perspective and hoping to continue that as a perspective that, it’s really strategic in the long run.

[06:56] Radu Palamariu:

Super and Sheri, What would be your view on this?

[06:59] Sheri Hinish:

Yeah. I mean, when you think about cutting costs, reducing risk, achieving growth, many of the companies that I speak with, they focus on lean improvements, waste management and some of the business continuity activities that are tied with erratic weather and climate change, retrofitting older buildings and plants, checking the boxes. But you asked us how far should one go with sustainability? And this is a really provocative question. So, let’s stir the pot of it. I don’t disagree that sustainability, maybe a people versus people issue when you think about human behavior as both the root cause and the solution of many of the crises that we face right now. And the critical question for me is, if stewardship is a duty in corporate sustainability, how far should we go? Or if we take the business as usual approach without regulation or compliance from industry across trading partners and consumers? How does this impact our planet in 30 years? And I’m probably less pragmatic than other supply chain folks. I’m a mother of three small children. I’m a dreamer, and I believe that we unequivocally have a responsibility to do the right thing in the world that we share. And the right things, for example, include carbonization and social justice. So, when you ask, how far should we go Radu. As far as we need to, that’s my answer. What’s the price of doing nothing? And you don’t have to look very far to see why change is needed. Look at Venice. The massive forest fires in the Amazon, Indonesia, Australia, recent blackouts in California. All of these pose a risk to both humanities and in the reliability and viability of supply chains.

[09:05] Radu Palamariu:

For sure, even though I think where Alexis is in California, there’ve been some massive fires and I think this kind of natural disaster is prevalent all over and much more frequent. There’s a need to act as quickly as possible and kind of correct and collaborate all these different perspectives, whether it’s corporate, government, social society and come together. And I wanted to move it and stir it in a very specific element or industry, which is fast fashion and consumer. Let’s say which are consumer goods, right, because they’re usually some of the most. One, they do produce waste. I know that both of you are very passionate about the subject. So maybe let’s start with Sheri and specifically in this segment fast fashion in FMCG. What would be some of your thoughts in terms of what can be done better to achieve a sustainable supply chain and a more sustainable mindset in general?

[10:09] Sheri Hinish:

Sure, so this is a timely question because the holiday season is upon us. And one of the first things I ask large fashion brands who say that they embraced sustainability is what are your exact plans to sell less clothing? Black Friday is right around the corner in the states, and I love Patagonia’s ad. Don’t buy this jacket. When I think about sustainable fashion Radu, a few words come to mind. Ethical, responsible, radical transparency, circular and sharing the end-to-end story behind each garment. How are you empowering local communities where you operate? And some of the key challenges when it comes to sustainability are the rising costs of raw materials, ensuring ethical labor that’s fair and child-free, and the changing regulatory environments in this transition away from fossil fuels, both in transportation and production. I think some of the most positive changes are the shifts in consumer trends like the growing segments of low haas and natural lights who are supporting slow fashion and brands like Patagonia, for example. The scale is still a huge challenge in sustainable fashion, and we need to figure out how to help. Technology can more efficiently down cycle use garments and how we can collect enough material because current consumption rates are just not sustainable. From a supply chain perspective, I think we really need to rethink the over-reliance on freshwater end-to-end in fashion, and also this includes the use of cotton and how can we extend the life and wear of garments, so transitioning to business models that include repair, reuse and creating a conduit for recycling if a garment has reached end to life. I mean, the hard truth is it’s really all about personal consumption habits, and we need to change and that starts with buying less. Folks really underestimate the power of their pockets. In my point of view.

[12:24] Alexis H. Bateman:

I think you really touched on most of the hot button issues there. And how kind of the industry needs to start to act on their environmental and social impacts. I think it was a really good kind of coverage. I think some of the issues that come about and some of these consumers focused issues are that there may be already early movers that are putting out, are doing very kind of innovative things, kind of changing the norm. We’re gonna, referred to Patagonia’s, ‘Don’t buy this jacket right’, kind of shifting what we perceive as the norm in the time of Black Friday, where really, there’s an increase in advocating for buying more for the holidays and kind of disrupting that. But I think you know the evolution over time is going to be slow in terms of consumers being willing to change practices. So, I think there needs to be a readiness by the fashion industry to change different models, to offer different solutions, whether that be responsibly sourced for constantly produced garments that are able to be disassembled and take it back so that they can be recycled and create closed-loop systems and then also trying to shift the mindset for the consumers. The newest trend and buying more continuously is not really on par with keeping environmental social impact low. So, I think there’s going to be sort of this, no change that needs to happen with the consumer mindset, that’s not really the best way to go about it and also looking at different alternatives, whether that being, the desirability of used products. So it’s another way that Patagonia and other brands and others have kind of offered, these are really good products. There’s a lot of life in them. If you want to use it in a second-hand market, this is still appealing. And recently Patagonia opened up the thread up, not the thread up. They re-threaded so that you could buy clothes that were made from old clothes. And so, I think there’s a lot of really interesting things that are going on there, so I think it’s promising, but, as sure he said that the scale and really making this norm is were right far from it. So, I think that with these kinds of early movers with these innovators and different options beginning to be out there and having that be a desirable thing for consumers will make it easier for the industry as a whole to shift. But, as far as, the way that businesses and supply chains are designed, push more to produce more. So I think that it’s going to have to be a fundamental shift in mindset and consumer perspective in the industry to really shift to those practices. But, there are some promising innovations out there and different practices that I think are leading the way and if we can make that more than the norm, there’s gonna be a lot of promising change.

[15:29] Radu Palamariu:

I can share that in this part of the world, for example, Alibaba and it is not so well-known, and I don’t think they’ve made a lot of noise about it, and they should. But they have a massive program of collection on and the redistribution of second hand-clothes. So, they, I haven’t looked into the whole detail, so I don’t know if they actually recycled. I think partly they use clothes and make new ones from old clothes and part of it is sanitizing them and then reselling them as second-hand clothes. But it’s a massively growing business for Alibaba and parts of the world and obviously also in Asia. Depending on the country, there are emerging economies that are different, buying power in terms of different countries so that they can work better maybe here. But it’s still something that is highly successful for them. And I want to jump a little bit on the root cause of this discussion is maybe the system in itself. Most countries operate on the, most of the world, actually, on a very capitalistic model where you know yourself more, you make more money than you appear or you’re contented or you’re earlier of the company growth, so that’s the model. So basically, companies in general, and in order for them to change given that the overarching model is, several more make more money is hard and it almost starts. The question that pops into my head is also what some of the mindset and how to operate on the mindset of the consumer. And because if a consumer keeps having a concern and keeps thinking that we need to change our clothes and faster and faster and have diversity and all of that, then we’re kind of fueling this industry and industries is just gonna continue to give us the same thing. So I guess, on the flip side. Is there one more that we don’t know about the mindset of the consumer side so that consumers for their behavior can also start pushing the industry or fastening the change in the industry.

[17:33] Sheri Hinish:

I can share a point of view. I think that it’s complicated and the reality is that many consumers lack insights and awareness of the shared benefits of purchasing sustainable products, and it’s really hard to visualize accountability for everyday purchases. So, education and awareness are a key pathway, I think, in transitioning consumer behavior and transitioning toward a sustainable world. And when people, family members, friends, they say, what advice can you give me? The number one piece of advice is to consume less, waste less and don’t make excuses. Sustainability, It can no longer be the conspiracy of silence, meaning we have in arrogance and ignorance around climate-related issues. It needs to be a part of dinner table conversation, and we also need to embrace the opportunity to share this information just like this podcast share across social media learn across digital platforms and the key really acts and just starts. Don’t wait because we don’t have time. Climate change is a critical issue. Life expectancy is declining. We’re seeing the greatest income in equities since the 1920s, and we have an opportunity to act right now. So talk to your children, your family, your friends and really focus on, one day, one step at a time. How can I consume less and waste less?

[19:22] Alexis H. Bateman:

I like every part of that answer. Definitely. Think all of that is very relevant. I think the other part of it is, making the kind of definitions and accessibility to what is a sustainable, more common language to those that are how is this gonna impact the environment, how it’s gonna impact my life and my children’s futures? And when you’ve kind of brought up like the dinner table, thinking about what is sustainability on our supply chains. I couldn’t even tell you that even sometimes my own family could define those two pieces, because they are complex, and they’re deep. And so the easy, engagement practices in terms of, very well said, consuming less, wasting less air, the easy kind of practical lessons. But, trying to think of the ways that you can do that in your immediate life with which, we have these environments that consumption is advocated for, that it’s gonna be a transition over time. So, how can we provide consumers tools, to buy the right products that are gonna last for a long time? They’re going enable them to do those different things and to what end? And why are they doing it right? Because I think there is really a pretty deep-seated, mindset that you know, buying more and buying these products is, it makes me feel good and it makes me, it serves the need. So, I think that the way that we can kind of offer opportunities to transition, inform transition so that this is something that is, that they know, and it’s clear that this will be for the betterment of the world and betterment of their families. So, I think there’s gonna have to be a transitionary period where that information becomes kind of digestible to the consumers so that they can make those informed choices. At CTO, we do different kinds of research in terms of to what extent that consumers really kind of understand some of the choices they’re making, when they’re at point of sale and whether you know labels that, tell them this is a more sustainable product, whether that will change their buying habits at point of sale. And, unfortunately, we’re not seeing a lot of promising moves there. But, you know, I think that the more than they have the opportunities to make those choices and the more that they are, choices that are held equal in terms of, you know, price and quality, then they will make those choices. It’s just that you know, they’re still kind of a limited opportunity for them to make those traces where they don’t necessarily have to pay more, or it’s not perceived as poor qualities. I think we’re getting there, so I think that the consumer component needs to be top of mind, but I think the other part of it is the company can’t just act for the consumer. There are so many different reasons to act for their future as a company, for the communities they’re impacting, for the various stakeholders that are looking to it. So, it has to be kind of a comprehensive response of why they’re not doing it, not necessarily just for the consumers. So just, kind of thinking about, both from the consumer and for the company action perspective.

[22:39] Sheri Hinish:

Alexis, you bring up a great point that it’s easier to have blinders on, and it’s easier to just be lazy and do nothing and throw it over the wall. But the insights that you mentioned so people can understand the impacts of consumption and decision-making, and when you mentioned the company’s responsibility and understanding the total cost of ownership. So that also means considering a wider range of environmental, social and economic issues and I don’t know that people are really at least for my experience. When you think about CSR, I don’t think that it’s as mature as it needs to be at this stage.

[23:20] Alexis H. Bateman:

Absolutely not.

[23:21] Radu Palamariu:

And on the topic of maybe sharing some other case studies, because you mentioned both of you have mentioned Patagonia and it’s a great example and I think the whole brand of Patagonia stands for sustainable clothing and fashion and all of that. But maybe we can also look at other industries of the companies that you’ve seen doing some good things. I would even challenge you if you can think of and maybe Alexis, you look a lot of your clients that the mighty and the corpus that you work with, maybe even making decisions that on the short run may impact the bottom line and may not be perfectible, but on the long term would either get value from direct from financial, but also maybe from prestige, from obviously, from the brand, from doing the right thing, for the right cause for the right environment, maybe you can share some of the case studies.

[24:11] Alexis H Bateman:

Absolutely. I have a couple to come into mind and there’s too many to list. We could go on forever on the companies that are doing really innovative things. But, one company I like that I’ve worked with over the years and is doing really interesting things is Dr Bronner’s magic soap. So, they’re based in Vista, California and they have home goods and body soaps and cleaning products. And so they have been around their family company, and we were doing the research across many companies and Yossi and I came upon them years ago with our colleague Edgar Bronco, and they just did things that kind of book traditional supply chain trends? So, when they were going to put together their formula soaps, they determined that palm oil was necessary. They couldn’t really replace that ingredient. And as we know palm oil is an ingredient that has environmental impacts in terms of deforestation around the world, primarily in Malaysia, Indonesia impacting the smallholder farmers that grow it. And so they really wanted to understand where their palm oil was coming from. So, they actually just instead of trying to go into the nebulous kind of commodity market, get to source that material they vertically integrated, a mill so that they could ensure that they were sourcing from different smallholder farmers that were being paid fairly, that we’re not grown on deforested land that had full visibility. And so, something like a vertical integration granted, they’re a small company, and they can operate a little bit differently. But they are, they’re as companies. They were looking for growth, they want to kind of grow their product, and show other companies that they can operate this way and still make a profit. And so they pay that up for an investment so that they could ensure that they had as sustainably grown as possible. Of course, defining sustainability for something like Palm Oil’s kind of a circular thing. But it’s very hard, and it’s still agreed upon definition, but the best that they could do. Truly the best there know that they can look into their supply chain, have that full visibility to farm level, know what’s happening, they do preceding of funds so that the farmers aren’t impacted whether it depends on if they have a very productive year or not productive years so that they can have that money in advance. They just do things that are against the norm, but they still continue to grow. They have been doing post consumer cycled plastic for years when, I think that some companies were just starting to learn how to do that and really kind of starting from scratch. And how are they going to scale that? So there, one that I’ve looked at that you know, they just do the opposite of what everyone else does, and it works for them. And I admire their boldness and really kind of disrupting that, in terms of just making sure that they have sustainable products. Years ago, they even have said which you know is always kind of the crazy examples. They’ve even turned down buyers to retailers that they didn’t necessarily agree with because they felt at the time. And this was this story’s little bit dated that they didn’t want to sell their product to a retailer that they didn’t want to work with. And, if you could think of another case where someone turns down a buyer, I’d be hard pressed to find that so there one that I’m finding is, they just continue to kind of disrupt the way that, and they offer a high quality product that continues to grow. And another company that I’m thinking of that I’m kind of very interested in how they’re growing and how they’re offering is Everlane. So they’re a small apparel company out here in the Bay area and there putting the full cost breakdown of their product, which again very abnormal. Not that it shouldn’t be the norm, but showing toward extent each note in the supply chain, each partner, each tier, Whatever language we want to use is getting value from the end price that you’re paying right so that you can see that there’s, fair wages being paid to those working at the manufacturing plant, how that values distributed across the supply chain. And that’s quite, innovative and quite new. And, it seems, for how supply chains have operated for many years, that’s very disruptive. And I think, seeing that they as well, similarly to Dr Bronner’s are continuing to grow despite, what many companies would say, giving away their secret sauce, that they’re showing you kind of their whole cost breakdown of value that they’re getting from that, that piece of apparel you that you’re buying. So, I could go on, but those two that I really kind of find doing some very interesting things and bucking the norms and continuing to grow.

[29:10] Sheri Hinish:

It was Everlane. You don’t typically see radical transparency into the end of a supply chain environment. So right, I definitely am a fan of Everlane.

[29:24] Radu Palamariu:

And what I’ve observed and we had on the podcast, Dirk who is Chief Officer of Henkel, just a large consumer goods company, and I saw recently that Colgate managed to create a recyclable tube, and they meant they made that technology freely available. They didn’t paint until they actually made it really available to the industry. And Dirk, from Henkel to come back to the point, also said that some of the work that they’re doing in the space of recyclable packaging they basically also make it freely available to anybody else. So there is also an increased, cooperative mindset in terms of companies coming together, sharing the IP, sharing the knowledge, sharing the way of designing or sustainable products and giving it out for free just for the sake of all of us benefiting, which I think is which is a great thing, that it’s happening. And it’s also another shift in the right direction from a change of culture, ultimately right, and the change of corporate culture and corporate mindset.

[30:39] Alexis H. Bateman:

Colgate making that move is really a good first move. Because this is how we can bring the economies of scale to these innovations. Because maybe they are more expensive start rate. That’s always the kind of detractor to implementing right away, because it’s expensive? But then, if we have that opportunity, share the IP and bring down the cost for everyone, then these innovations can become more diffuse across entire industries. And Colgate’s great for doing that. I also know Seventh Generation in Vermont they were actually were purchased by Unilever a few years back, but they’ve been doing that for years. So, they similarly, have been awhile into doing post consumer recycled having ingredients in there. They did disclosure of ingredients in their cleaning goods again against the norm. In addition to any kind of innovation, they would have sort of, period where they would keep it after release, but then they would open its hoping to scale. I’m glad that bigger companies are beginning digit X. That’s how we can really begin to kind of get those that times to scale to bring the cost down.

[31:53] Radu Palamariu:

And shift the needle for sure. And I wanted to specifically, talking in supply chain were all supply chain professionals. And they’re passionate about this. How would you say this topic about sustainability, very macro level, is infecting supply chains in general? All the chief supply chain officers that we’ve had in the podcast have spoken and have sustainability as the top three if not top five focus areas for their organizations. So maybe Alexis, you can share more in terms of how your seeing things from your interactions with supply chain leaders.

[32:28] Alexis H. Bateman:

Sure. Well, it’s a small question, so I could do that in a few words. Just kidding. I think in many ways, the probably most immediate way that, in practicality is that it’s a risk for them, because they’re perceiving whether that be, for weather impacts or whether that be for, pressure from external stakeholders whether it be internal from their internal stakeholders, that there is pressure to act. Whether that be a hard impact on the way their supply chains are operating whether that be, whether it be a compliance, a regulatory requirement that they need to change their practices. So I think that there’s, pretty significant risk for them to change now. I think that’s kind of the need to be an act. I think there’s also a strategic opportunity that there is a way to shift ways supply chains are operating now for the betterment of environmental social action. And also have it being a better operating supply train. I think there’s a significant amount of opportunities, and if we can match that risk with opportunity and see them as one in the same it could be more of a strategic as opposed to like we’re a reactionary where we’re doing more of we’re doing more of a precautionary to do this for the value of our companies’ legacy of our companies and for them to be, companies that are operating in the next 100 years. And I think that, the company is well, they’re not perfect. Unilever is probably the clearest one that comes to mind that has been so public about their journey in space again, not perfect, but that they’ve said, we’re shifting the way that we’re operating. We’re bringing our brands on this, we’re going to do this as our parent brand, that all our different bands are gonna do different components of sustainability within our supply chain and make it sort of a corporate strategic action so that, our consumers trust us, that we know that we’re doing to reducing our environmental social impact. I think that there’s just really it’s being impacted in so many different ways, and along with the fact that, it’s an employee attraction and retension component not just, it’s definitely about the external factors, but I think that companies that want employees to come and join their company and stay with them. It’s really becoming a significant factor. We have our students that come through and I’ve been hearing them from years, and I’ve been working with them for years. And the voice of those that are interested in sustainability gets brought, gets whiter and louder every year that they want to work for a company that’s responsible. They don’t want to go home at night and have worked with the company that they feel is not committing in a significant way. So I think that, it’s very much outside in re-designing and revisiting your supply chain practices. It’s also within, that I want people that are going to stay with them. They’re going to be committed. And if they can’t really commit significantly and operate in a certain way that they’re not gonna have the right people, they’re not gonna have the best people. So, I think you know they’re getting hit inside and out, and of course, it’s slow, right? I think that it’s a transition, so I’ve seen that more in recent years than I’ve seen in the entirety of looking at this topic. So, you know, I would probably say the last three or four years it’s gotten much louder than I’ve heard in the entire time I’ve been looking at this topic.

[36:03] Sheri Hinish:

I totally agree with you, the whole conversation around value and, creating purpose envisioned beyond oneself. It makes sustainability a human issue, and it’s not a supply chain issue anymore. It’s this global issue in a world we share, and it’s much deeper than supply chains, and I know that I’ve gone on the record, and I’ve said that supply chains own the responsibility of product stewardship. But I’ve changed my mind. And when you think about corporate sustainability, it’s not a department. And if a company really has a commitment to sustainability, it’s intrinsically a part of every person’s purpose. And sustainability should be as much of an individual commitment as the top leaders’ commitment, in my point of view.

[36:54] Alexis H. Bateman:

Absolutely, totally agreed. Well said.

[36:56] Radu Palamariu:

I wanted to also bring into the discussion that pieces of technologies that can help in supply chain and can bring a huge impact in terms of sustainability. For example, transparency is a big topic. The more transparent your supply chain is, the better it is also to trace a lot of things that maybe it’s linked transparency and traceability. The two challenges that technology is tackling. And then if you have this, then also sustainability can be achieved easier. So, I wanted to ask you both. What are some of the game-changing technologies and the most impactful ones that you think could bring in lead to more in sustainability in supply chain?

[37:44] Alexis H. Bateman:

Correct. I don’t think I can list a few, I think what makes sense on these is realizing that, any of the solutions are a system of things? So it’s getting the right information. The right technology, all together and have the right process is in place to make that information actionable. So I think the more that, we’re moving from traceability and transparency is sort of a static definition to realizing that needs to be you know, the right mix of technologies, the right mix of people, the right mix of platforms and solutions that we can integrate and operate in a certain way and enable, the users and users of that information to get it in the quickest and most digestible format. I think that those are the technologies that are really having an impact because, of course, we want to trace our product. We want to know what’s happening upstream, whether we can slap an RFID on it or however we want to track that and then have that information transmitted and uploaded into shared information platforms and being able to access that anywhere in the world at any time. I think that those solutions and those that are being integrated in a practical way so that the decision makers have information to that access to the information. I think those were the ones that are really disrupting it so that, again making information available to those that you know It’s actionable information. We’re you know, I’m at a university that loves to work with data. And we got as much data as we could ever want in the world. We have so much, as we’re all talking about big data and we want more information. But at the end of the day, what information do we need to make the decisions that are strategic that are going to enable, sustainable choices and be more informed about those practices, though, that we can do better every day. Those of the technologies that I’m seeing the most promising so that we can make informed, and decisions that are strategic. So I think, I couldn’t put my finger on, a handful. But, we know that there are some that are disrupting, but really, I think it’s the system of solutions that are making it easier for people to act.

[40:08] Sheri Hinish:

So, Alexis I have a question around the shift to net carbon energy. So when solar hydro bio-fuel and carbon capture and storage. Are you hearing that decarbonization is front of mind for CEOs or COOs?

[40:24] Alexis H. Bateman:

In my hearing, it’s a friend of mine. I think it’s on everyone’s radar. If we’re gonna look at everyone’s, materiality assessment in whatever they feel that however we feel they’re committed to that mapping of priorities straight, in the depth to wish for their commitment. It’s on everyone’s radar. I as far as sort of with me transition to adopting those energy sources and transitioning to carbon neutrality. I think that you know that’s pretty far and I think that the timelines that are out there are much longer thanwe want them to be right. They said, we’re gonna be this and, you know, 25 years and it’s just not soon enough. So I think that there are promising shifts in the way that companies are operating and you know how they’re kind of making different solutions. And of course, you know their own operations is or where they start first rate, because that’s how they have much as the most control? So they say we’re gonna, source our energy differently. In terms of how we’re operating ourselves. But, getting up into the supply chain, those that are not as visible or operate in different parts of the world that really have those opportunities. I think that that’s pretty far off. It’s on the radar but the adoption, I think it’s slow.

[41:48] Sheri Hinish:

Yes, like you mentioned, I think the investment for renewable infrastructure is lagging and it’s hard for people to imagine the transition right now.

[41:58] Alexis H. Bateman:

Absolutely.

[41:59] Radu Palamariu:

This’ll definitely take time, but I would want to challenge both of you from a question. If you are a CEO of a 50,000 person company, let’s put it into manufacturing, what would be some of the first things that you would do in terms of behaviors and actions that would you would try to enforce and maybe low hanging fruits in terms of the company becoming more sustainable? What would be some of the thoughts that would come to your mind as a CEO?

[42:36] Sheri Hinish:

Yes, a lot of companies have some of these operational efficiencies in place, and these are around lower energy, reducing water use for cycling. Everybody bring a coffee mug type of activity. But I think there are things that you can do that really further the cause. So when it’s done right, and I think we’ve mentioned this a few moments ago, sustainability becomes everyone’s mission, and employees can be a great resource for critical improvements. So, an example that I can share from my own work encouraging rethinking day in the life processes in behavior. So how might we do this differently? Considering total cost of ownership and environmental impacts, this could be a life cycle analysis mindset. It could be a mindset of minimizing consumption or thinking about waste as a resource, more like collaborative consumption in network based stewardship. And I remember Dr. Kevin Lyons at Rutgers, one of the first sustainability classes I took three years ago, saying that he was a supply chain archaeologist and when I asked him in my early journey, what can I do? Where are the low hanging fruit, he said, always start with waste literally observing trash and service is and waste that is all around you. So one of the activities that’s worked in the past is holding green hackathons. You’re incentivizing and gamifying engagement in a way that’s really cool. And it gets folks excited about sustainability, and you can rally around purpose and create camaraderie amongst employees and even bridge workforce generations. Another thing is reducing travel and using digital workplace remote work. You can lower your carbon footprint and also decrease operational overhead. It gives folks more time back, and we’ve seen recent success stories from Microsoft recently in others reducing the work week and increasing productivity. And I’ve actually worked in a 3 to 2 schedule and had shared workspaces. I’ve recently worked remotely. It’s great. And I think, just lastly, the reality is that you depend on your supply chain for integrity across partners in trading relationships that really extend beyond your immediate purview. So, a great way to embrace sustainability is support other businesses with a commitment to sustainable ways of working. These are all great steps.

[45:34] Alexis H. Bateman:

I agree with every single one of those. I think that, definitely starting within your own organisation to get the adoption. I’ve looked at organizational change for sustainability, and how different companies have done it. It’s always a mix of different solutions, and many of those that Sheri mentioned in terms of how we get employees to adopt it in their own daily practices? So, if they embedded with how they live at home with how they’re working in their office with how they operate in their daily life, that reusable mugs and plates and using public transit and the opportunities afforded that can really, do that on their own personal footprint. And then once that sort of embedded in their own persona and their own daily life, and that can transition into their daily jobs. And then how there are responsibilities allotted to everyone to be making sustainability a part of their yearly report in their annual review and making you know the ownership diffuse across different employees as opposed to a singular sustainability department and making it everyone’s roles. And in one way or another and making it a challenge and an opportunity and having those, communications that are praising those and praising the small winds. And a lot of critics about small winds and we’re not making moving enough needle on while I know that to be true as well, I think that the small winds or where we get started, right that they’re saying, even if what, we turned off the lights. We saved a short amount of energy. We’ve reduced water this month, and every step counts. And they build in, of course, sharing that broadly so that others can adopt those small winds so that that small wind across many different companies, many different organizations units. That becomes a big win. And I think that’s the only way we can get started. So I think that kind of really those low hanging fruit within your own company and there’s also knowing that no transition is easy, so if you can get those small winds to begin with and when you want to tackle the big wins and knowing that it’s not going to be a linear journey from, getting your supply chain to come along with you on this journey. Whether that be your direct suppliers or trying to get engagement deeper in the supply chain. Or even looking at your end of life product and looking at circular pining, closed loop objectives. It’s not going, It’s literally not gonna be a little in here, but also, it’s gonna be a very challenging journey. so I think, you have to get those small wins first so that you can have the long term adopted. It’s a long term adoption and make sure that, when we are trying to tackle the longer term the higher up fruits, that commitments are already there. So when the going gets tough, we don’t we don’t give up.

[48:25] Radu Palamariu:

Thanks for sharing and also the big part is what we’re doing today and what we shared before in terms of storytelling ,in terms of sharing that this case that is ,in terms of bringing this conversation of the forefront cause more people talk about it, more people will do it. It becomes embedded in our culture and more and eventually just a fabric. I’m very hopeful that this will become a fabric of our daily behavior at some point. Overall, all over the world, it is already happening. There’s already signs and I was very optimistic when I saw that, for example, in Italy, they put sustainability in the curriculum for all schools. It’s a must have a subject to study in all the schools in Italy. My daughter at her school has projects around. How do you recycle? How do you save energy? How do you eat healthy? Not necessary from a health perspective, but also from a carbon footprint perspective. So I think education, we’re seeing a lot of things being done in a good way there and hopefully more and more as time goes by and as quickly as possible, hopefully. So I want to end on this positive note that things are moving in the right direction, but also by encouraging, like you’re both also said people to, I mean, we need to start with ourselves. We need to be the change that we want to see in the world and to share it without this and to continue to have these conversations. And I’m pretty sure that companies will be more and more and of course, it’s also the good part with all this discussion that it becomes very important and must have brand activity like we rightfully shared that in order to achieve this phase, you need to have this element which is just crucial for people nowadays that the company does things in the right way, which is another big class. So on that note, I wanted to thank you all for the time. Thank you for sharing. Thank you for the case that is. And hopefully in the next months and years to come with you. Even more noise, more improvement, more big data for MIT to analyze Alexis and to share with us on. Our sustainability is growing and blooming.

[50:38] Alexis H. Bateman:

Wonderful. Thank you for having me.

[50:40] Sheri Hinish:

Thank you for having me. Also, the key is to act now and spread awareness guys.

[50:46] Radu Palamariu: