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Supplying a Sustainable Future

By Clare Becker

March 6, 2018

WSB’s Grainger Center for Supply Chain Management and The Nelson Institute for Environmental Studies partner up to explore supply chain and sustainability issues during campus conference.

In 2015, the Madison-based company Spectrum Brands, Inc. made a major acquisition of a pet supply facility in South America.

The acquisition as reported strengthened and diversified Spectrum’s pet segment position. Daniel Hutter, chief sustainability officer at Spectrum, supported the company by developing a new style of sustainability acquisition playbook from scratch.

Daniel Hutter talks during the panel
Spectrum Brands’ Daniel Hutter answers an audience question during the conference. PHOTO: PAUL L. NEWBY II

Hutter explained, “Standard environmental playbooks, while important, focus on environmental liabilities; we wanted to raise the bar and look at other facets of sustainability such as social and governance risks. Water efficiency at the plant wasn’t great; and population growth in the area had put a stress on the water system.”

Acquisition intelligence through the facets of sustainability presented an opportunity for Spectrum to positively impact a local South American community and secure the water resources needed for the future while providing quantifiable integration issues to the deal team.

As Hutter said, “It was a turning point for the team to look at sustainability through the lens of a business ecosystem.”

Hutter recounted this story during a two-day conference, “Sustainability, Supply Chains, and Earth Stewardship: Convergences and Conflicts,” hosted at the Wisconsin School of Business. Sponsored by WSB’s Grainger Center for Supply Chain Management and the University of Wisconsin–Madison’s Nelson Institute for Environmental Studies, Hutter was joined as a guest speaker by Caitlin Clarke, senior supply chain fellow with The Nature Conservancy. In a conversation moderated by Nelson Institute Director Paul Robbins and Grainger Center Director Jake Dean, Hutter and Clarke shared their expertise and insight on how corporations are approaching issues around supply chains and sustainability.

Greg DeCroix talks during the breakout sessions
Greg DeCroix, academic director of the Grainger Center for Supply Chain Management, talks about sustainability implications for supply chains. PHOTO: PAUL L. NEWBY II

“This was a fantastic event for so many reasons,” Dean says. “Sustainability and supply chain management are strongly linked business concepts today, and people approach sustainability from many viewpoints. Bringing those viewpoints together, and drawing on the outstanding leaders and community of the Nelson Institute at the same time, was a great example of how we can partner across our campus.”

A changing landscape

Traditionally, business and conservation have been positioned as adversaries, locked in a zero-sum game on opposite sides of the fence. More recently, both groups have moved beyond this outdated model. Companies are questioning how they can build sustainability into their products and supply chains while conservation groups are finding ways to reach out and be of assistance in the process.

Clarke, who works with corporations to help them assess and achieve their sustainability goals, says one of the keys is to remember that each firm is different, with a distinct product and reputation that make the sustainability conversation “a little more nuanced” and complex. “You need to meet people where they are,” Clarke says. Hutter’s experience with the Spectrum Brands acquisition is a “great example of how to value an economic service.”

Caitlin Clarke gestures as she talks
The Nature Conservancy’s Caitlin Clarke shares her experience with helping private sector firms meet their sustainability goals during a breakout sessions. PHOTO: PAUL L. NEWBY II

While there’s been significant progress made, there are still plenty of hurdles. Consumers want to know what’s in their products, but issues like traceability and identifying the supply chain can be tricky, even when companies are well-intentioned. Clarke stated that a simple chest and dresser drawer set sold by a major retailer, for instance, could pass through the hands of 3,000 to 5,000 different people before it hits the sales floor. Emerging technologies like blockchain may play a big role in the future, Clarke says. “I think one of the things that’s really important about blockchain is that it pushes information about these supply chains up through to the buyer rather than requiring them to pay somebody to pull it out for them.”

Framing a sustainable future

The conference’s second day featured a morning workshop of mini sessions where industry professionals and UW–Madison staff and faculty joined Clarke and Hutter to tackle big challenges, such as defining sustainability in a corporate setting, preparing students with sustainability skills and understanding, and potential avenues for collaboration between the UW and corporate partners.

Clarke says having at least some business background—something she felt she lacked as an environmental studies major when she first started out—is essential for students entering the sustainability dialogue from the conservation side. “There’s absolutely no way that any environmental professional can influence private sector actions that they don’t understand.”

Paul Robbins introduces the panelists
Paul Robbins, director of The Nelson Institute, facilitates a group discussion. PHOTO: PAUL L. NEWBY II

Kohler’s Jeffrey Zeman says that he is surprised that sustainability seems to be set apart from other decision-making criteria that supply chain professionals already value, such as quality. “One of our barriers is that sustainability is still viewed as a thing that you’ve got to do ‘extra’ on top of everything else and that’s absolutely not the case. It’s an additional lens that helps you make better decisions in those same other categories you care about. A quality project is a sustainability project very often.”

Robbins maintains that it’s exactly these kinds of discussions with the inclusion of multiple voices that are needed, and it’s also where he sees the potential for collaboration—starting right here on campus.

“The future of the Earth largely rests on the question of our stuff: where we get it, how we get it, and how we move it around. That makes supply chains the fundamental barrier and opportunity for sustaining the planet. Get supply
chains right, and we go a long way to solving our environmental challenges. By bridging the Nelson Institute and the Wisconsin School of Business, we can address these challenges and build new tools, research, and educational activities in this critical area. I’m enormously excited about the prospects for this partnership.”

Read about another forum hosted by the Grainger Center for Supply Chain Management focused on blockchain.