Environmental improvement of product supply chains: A review of European retailers’ performance

Retailers are beginning to accept responsibility for the environmental impacts of their product supply chains. This paper: (i) summarizes the challenges faced by retailers to drive environmental improvement across private-label food, textile, furniture and household chemical products; (ii) provides a review of 25 major European retailers’ best practice actions. Retailers drive environmental improvement of supply chains using third party environmental certification (e.g. Forest Stewardship Council), product performance labelling, environmental requirements for suppliers, and supplier improvement programmes. Proactive retailers go beyond product labelling to use widespread product certification and extensive collaboration with suppliers to drive systematic environmental improvement across product groups associated with high environmental burdens. Quantitative data on sales shares of improved products are patchy but indicate large variations in performance across retailers. Specialist retailers and smaller cooperative retailers tend to be front-runners in supply chain improvement, whilst very large and price-led grocery retailers tend to be laggards. These differences partly reflect logistical and market positioning difficulties for the latter types of retailer to shift towards sustainable sourcing, but also different perspectives on responsibility. Front-runner retailers accept a high degree of responsibility for supply chain sustainability compared with laggard retailers who tend to place the onus on consumers to drive environmental improvement across supply chains.