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The pulp and paper industry is among the largest industrial consumers of water and energy in the world and has faced environmental concerns for some time due to its resource-intensive nature.
Pulp and paper suppliers have been heavily criticised for discharging chemical pollutants such as chlorine into surrounding water bodies, causing severe damage to aquatic ecosystems and health concerns to humans and wildlife living in surrounding areas.
The industry has also faced serious allegations regarding illegal logging practices that have forced governments and non-governmental organisations (NGOs) to implement and strengthen regulations.
The demand for pulp and paper is growing, especially in emerging markets, which is placing an increasing pressure on forest resources. According to the World Wide Fund for Nature's (WWF) Living Forests report, paper production and consumption is predicted to double over the next 30 years, with overall wood consumption expected to treble. The major challenge here for suppliers will be to keep up with demand, whilst lowering the industry's environmental impact.
Government regulations and initiatives have driven innovation within the industry, as pulp and paper suppliers look to develop efficient recycling practices and technology and investigate the use of alternative forms of raw materials in their production lines.
Pulp and paper suppliers are also continuously looking to reduce production expenses – particularly as both water and energy are significant cost drivers for the industry. Therefore, reducing these inputs will not only be beneficial for the environment but will also generate value for the company.
A vast amount of pulp and paper suppliers are already making significant movements in the direction of becoming more sustainable and improving transparency within their supply chains. The WWF 2015 Environmental Paper Company Index has highlighted the continuous improvements in increased transparency and sustainability among pulp and paper suppliers.
For instance, 69% of participants improved their performance across responsible sourcing, clean production and environmental management systems, and reporting over the past two years.
To achieve supply chain transparency and contribute to a greener economy, procurement should work closely with their suppliers to ensure all pulp and paper is sourced from sustainable, well-managed and certified forests. Procurement should also consider working only with suppliers that have adopted environmentally friendly pulp and paper production processes, such as efficient recycling and waste management initiatives.
Procurement Leaders members can find the latest pulp and paper category report here.
This article is a piece of independent writing by a member of Procurement Leaders' content team.