IBM Sees Green in Green Procurement Consulting

It's certainly contrarian to pursue green consulting opportunities in a market that cares far more about cost takeout and working capital improvements than doing right by the planet and regulation. But to IBM's credit, that's precisely what they're pursuing at the moment, announcing a new supply chain consulting offering. Seeking Alpha, linked above, has the scoop. According to their post, "The computing giant has begun to offer sustainable procurement consulting services to help companies migrate from traditional products and practices, like fossil-fuel-based resins or how frozen food gets inventoried, to more carbon-light ones. Approximately 80 percent of the greenhouse gases associated with a particular product are emitted by third-party vendors and, typically, a company has little control or even knowledge of what's going on behind its back."

What are some of the advantages of targeting green initiatives further down the supply chain? Among other benefits, IBM suggests "reducing carbon will help companies avoid costs under cap-and-trade or carbon tax systems [and also] claims that established guidelines can reduce carbon emissions by ten percent. Logistical planning can conceivably also reduce the impact of commodity price swings. The same system can also be used to better track health, employment practices and other issues. The E. coli outbreaks of recent years have demonstrated how large food retailers are unaware of the water and sanitary practices of their suppliers that, ultimately, they will be held accountable for." So in short, there are quantifiable risk reduction and even potential cost benefit to tackling green procurement. I just hope IBM has an audience for it given the nearer-term mindset that many executives are embracing at the moment.

Jason Busch

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