Supplier commitment for a long-term sustainable development: Gaining competitive advantage together with a sustainable supply chain

Climate change is a global challenge driving firms to adopt sustainable practices and comply with EU carbon-neutral targets. To mitigate environmental impact and ensure long-term sustainability, companies must integrate sustainability into their operations, focusing on reducing greenhouse gas emissions. Organizations are increasingly focused on the environmental performance of their entire supply chain, viewing sustainable supply chains as both a competitive advantage and a strategic priority. For the case company, engaging suppliers in sustainability efforts is important, as suppliers significantly influence the company’s overall sustainability and its ability to meet decarbonization targets. The case company’s approach involves ensuring supplier compliance with environmental standards and fostering a collective commitment to sustainability. The research studies how Finnish machine building company can engage existing suppliers to be compliant with their environmental sustainability goals. Research examines the means and the possibilities for case company to increase and secure its competitiveness in the market by collaborating with suppliers on environmentally sustainable initiatives. The outcome was achieved by examining the current state of the supplier selection process, sending a decarbonization survey to the 130 biggest emitters across 14 different component categories, and attending supplier interviews. The research is executed as qualitative research, focusing on a current state analysis. Results indicate that the arranged survey was a first step towards supplier engagement. Collaboration and open communication play a vital role in implementing new sustainability requirements. Supplier engagement and communication can be developed through regular workshops, open communication sessions, and dedicated sustainability channels. This approach helps suppliers to understand case company's sustainability goals and promote continuous improvement. Although environmental sustainability is considered in the ...