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Turning the after-sales supply chain green

EnvironmentRiskNorth AmericaCorporate social responsibilityEthicsReputational RiskSupply DisruptionConsumer ElectronicsTechnology and TelecomsBlog+-
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Samsung’s recent recall is causing the company all manner of trouble. From lost revenue to compensation payments to the damage to the brand, it is costing it dear.

 

But Samsung isn’t the only one to suffer as a consequence of recalls, Mother Nature does too.

 

In a recall situation, emergency air freight is often utilised to bring a product quickly and efficiently out of the hands of the consumer and back to the manufacturing facility. This itself emits high levels of carbon into the atmosphere. If those products have to be dumped the materials don’t tend to be recycled either.

 

Oeko-Institut, a German research and consultancy firm, estimates that the 4.3 million smartphones being recalled by Samsung contain more than 20 metric tonness of cobalt, around one tonne of tungsten, one tonne of silver, 100 kilograms of gold and between 20 and 60 kilograms of palladium.

 

These materials are difficult to mine in the first place and are also largely sourced from places such as the Democratic Republic of the Congo, which has been beset by armed conflict for many years and fears are that armed rebel groups control the mines and funds that come from these operations.

 

Samsung itself had said that it would not recycle the returned smartphones.

 

Given the lack of clarity over the cause of the smartphone fires, it isn’t necessarily surprising that Samsung wants a clean slate from the devices altogether and doesn’t want to risk putting potentially dangerous components from them back into their supply chain.

 

From a consumer risk mitigation perspective, that makes sense.

 

But, from an environmental perspective it makes less sense.

 

Environmental group Greenpeace has called on Samsung to find a way to reuse these materials rather than dump them.

 

"Samsung now has an opportunity to set an example for the industry — will it recover and reuse the precious metals and other valuable materials in these 4.3 million devices and avoid an environmental disaster or will it simply dump them?" said Jude Lee, senior IT campaigner at Greenpeace East Asia.

 

Greenpeace has launched a global petition challenging Samsung not to dump the phones and instead take this chance to rethink how it designs and produces its products.

 

The lucrativeness of recycling smartphones is much higher than some other sectors due to their high precious metal content, with Greenpeace reporting that it is worth over $1bn a year.

 

Samsung responded to the concerns saying that it would review the options open to it for disposing of the phones in a way that would minimise the environmental damage.

 

This story highlights a company’s and indeed a procurement function’s responsibility when it comes to the environment. Get it right and a potential environmental disaster can be avoided. Get it wrong and a business risks yet more negative headlines.

 

This article is a piece of independent writing by a member of Procurement Leaders’ content team.

Rachel Sharp
Posted by Rachel Sharp