CSCMP's Supply Chain Quarterly
October 19, 2018

Commentary: A tale of two continents

Although the causes of global warming have come under new scrutiny, governments will continue to pressure companies to reduce greenhouse gases in their supply chains.

The passage of climate-control legislation appears to be in doubt in the United States, but supply chain executives doing business in Europe still need to be concerned about their supply chains' carbon footprint. That's because European governments remain committed to curbing carbon dioxide emissions that contribute to global warming.

Allegations that some scientists may have fudged climate data—the so-called "Climategate" scandal—have affected attitudes in the United States regarding the need for action on climate change. A Rasmussen Reports survey conducted in March found that only 33 percent of respondents believe that human activity is primarily responsible for global warming, down from 47 percent in a similar poll in April 2008.

Pessimism about global warming certainly played a role in stalling U.S. legislation to establish a cap-and-trade system, a mechanism for curbing greenhouse gases. Although the U.S. House of Representatives narrowly backed a cap-and-trade bill last year, the proposal was on shaky ground before Massachusetts elected a Republican senator, giving the party enough votes to block that measure in the U.S. Senate.

Even without a new legislative mandate, the U.S. Environmental Protection Agency (EPA) was ready to move ahead with a regulation that would curb carbon emissions in the United States on the basis of existing pollution laws, but now any such action is likely be tied up in the court for years. In the wake of Climategate, a large U.S. coal company and three states—Alabama, Texas, and Virginia—have gone to court to challenge the science on which the EPA based its decision to declare carbon dioxide emissions a pollutant.

Europe, meanwhile, has already adopted cap-and-trade as a means to curb those emissions, and it has plans to step up controls over other areas, such as transportation. France this month even proposed that the European Union adopt a "carbon tariff" on manufactured goods from countries that don't take steps to reduce greenhouse gases.

All politics aside, supply chain managers with European operations will face continued pressure from governments on that continent to measure and reduce the greenhouse gases in their supply chains. Any European supply chain chief who hasn't already done so should prepare a "carbon map" of his or her manufacturing and distribution operations. But if you're in the United States and your supply chain does not extend beyond U.S. borders, you can breathe a sigh of relief—for now.

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

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