Abstract
This case study-based chapter investigates the influence of government regulations on the green supply chain management practices of five renowned companies which are classified in group A by Carbon Disclosure Project (CDP): Ajinomoto Group, Asahi Group, Coca-Cola Company, Barry Callebaut, and Danone. Considering their commitment to sustainability and presence in the high-impact sector of food and beverages, this chapter analyzes the impact of government interventions on these companies' supply chains. Their CDP responses, sustainability reports, and relevant literature were qualitatively analyzed using the cross-case analysis method to investigate collaborative strategies enabling low-carbon transitions in these companies. Based on the analysis, environmental sustainability dimensions were devised that demand substantial engagement with governments and regulatory authorities. Implications of the study are manifold as it not only provides recommendations for effective government-industry partnerships in the food sector but also provides the basis for further research in this area.
TopBackground
To review the global policies and regulations on reducing the environmental impact of food companies, we analyzed the literature on government policies and regulations shaping the environmental performance of food companies and the importance of supply chain collaborations with respect to internal and external stakeholders.
Literature on Government Policies and Regulations
Government policies and regulations play a critical role in improvising the sustainability initiatives of food companies as they can provide a set of standards and regulatory frameworks to guide companies towards sustainable practices. Such government policies usually incentivize companies for adopting green practices through tax credits and grants for sustainable initiatives (Guo et al., 2018). Therefore, government policies can act as a promoter of innovation and technology in the food industry. On the other hand, regulations can also drive the implementation of green practices by imposing non-compliance penalties and fines to ensure the prioritization of sustainability in any food business model (Albertini, 2013; Habib & Bhuiyan, 2017).
The study of Gunningham (2013) also implies that government policies including emission standards and waste reduction regulations provide equal opportunities for food companies while ensuring the consistency of sustainability efforts across the food sector. At the same time, these regulations also provide a roadmap for transparent and traceable supply chains by directing the companies to report their environmental performance and allowing the stakeholders to assess and compare their performance (Blanco et al., 2016).
Governments can also mandate the companies to gain important environmental certifications such as ISO-14001 or Climate Active certifications. ISO-14001 (Environmental Management System) provides a standard framework for businesses to implement and monitor sustainability practices across the supply chains. Meanwhile, these standards promote industrial symbiosis and effective collaborations among internal and external parties to achieve regional goals of carbon neutrality or net-zero emissions (Bravi et al., 2020; Castka & Balzarova, 2018). Moreover, these standards also benefit the consumers and shareholders as they realize the commitment of a company towards sustainability leading to improved reputation and competitive advantage for the company.
The study by Bohnsack et al. (2015) highlighted the role of government interventions in shaping the Corporate Social Responsibility (CSR) of food companies and how they catalyze the integration of sustainability into corporate governance. Furthermore, the comprehensive study of Knudsen et al. (2015) explored the CSR practices of food firms across environmental, social, and economic dimensions and suggested the positive influence of institutional and governmental pressures on these practices. While regulations help in maximizing the positive environmental outcomes for companies, they also forbid them from unethical practices such as greenwashing. Various studies have explored the motivations for greenwashing, the role of governments in preventing misleading marketing tactics, and the need for stringent policies on enabling trustworthy environmental disclosures (Kolcava, 2023; Nishitani et al., 2021; Sun & Zhang, 2019).
Key Terms in this Chapter
Environmental Stewardship: Environmental stewardship is a business concept referring to the responsible management of natural resources and the environment to ensure their long-term protection and preservation. To achieve this, businesses take action towards minimizing their negative environmental impacts, promoting ecological well-being, and conserving natural resources.
Life Cycle Assessment (LCA): LCA helps in the systematic evaluation of the environmental damage from a product, process, or industry by taking account of the utilized materials, resources, energy, and released waste and emissions during the lifetime of a product or production cycle of a process or industry. Product LCAs consider environmental impacts across the lifetime of a product, including raw material sourcing, production, distribution, use, and end-of-life stages.
Supply Chain Transparency: Supply chain transparency refers to the visibility and traceability of products throughout their movement in the supply chain and allows relevant stakeholders to understand the environmental and social impact of those products.
Green Supply Chain Management: Green supply chain management refers to the integration of environmentally friendly practices and strategies in all stages of the supply chain operations, including material sourcing, manufacturing, distribution, and end-of-life management of a product.
Net-Zero Targets: Net-zero targets are the high-level ambitious goals set by industries, organizations, and governments to balance their greenhouse gas emissions such as CO 2 by removing or offsetting the equivalent amount of emissions from the atmosphere. Entities working towards net-zero targets apply a combination of emission reduction strategies and carbon offset projects to achieve overall carbon neutrality.
Environmental collaborations: Environmental collaborations include strategic alliances and partnerships among business stakeholders including governments, competitors, suppliers, and contractors to share green practices and jointly work towards environmental sustainability goals.
Industrial Symbiosis: It is defined as a collaborative approach in businesses and organizations to optimize resource utilization and minimize total waste. Organizations and businesses do so by exchanging materials, energy, and by-products to develop a mutually beneficial system that serves the goals of the circular economy.
Circular Economy: The circular economy is an economic model based on closed-loop systems that minimize waste, maximize resource efficiency, and promote the reuse, recycling, and recovery of resources during all of the product/service supply chain stages.
Corporate Social Responsibility: Corporate Social Responsibility or CSR acts as a business model encompassing the ethical and responsible actions that companies take to ensure the positive impact of their operations on society and the environment.