Sustainable Manufacturing ‘Can Boost Profits $15.22bn Annually’

UK manufacturers can increase profits £10 billion ($15.22 billion) a year while cutting carbon emissions 24 percent — 4.5 percent of the UK’s total annual emissions — by shrinking their environmental footprint and improving resource efficiency, according to a study released yesterday by Next Manufacturing Revolution.

This business opportunity, which the sustainable manufacturing collaboration calls a “conservative calculation,” would also create 300,000 new jobs.

The report, co-authored by strategy advisory firm Lavery Pennell, the University of Cambridge’s Institute for Manufacturing and 2degrees, found that while many UK manufacturers have achieved 10 percent to 15 percent efficiency gains over the last decade, leading companies such as Coca Cola Enterprises and Nestle have achieved over 50 percent improvements in the same timeframe. This boost comes from reducing waste, upping recycling and green packaging, cutting energy intensity and implementing sustainable supply chain initiatives, among others, the report says.

This type of manufacturing revolution would also bring additional benefits such as improved energy and food security, less pollution and traffic congestion, reduced investment and maintenance spending on energy and transportation infrastructure and economic development in developing countries that supply UK manufacturers.

The report found eight barriers to non-resource productivity: senior executive leadership, information, skills and resources, design, infrastructure, legal constraints and collaboration.

It also outlines a program to address these barriers that includes establishing an open, online NMR community intended to “build skills and awareness while inspiring senior executive action,” providing tailored support to individual companies, and working with NGOs, businesses and policy makers to eliminate barriers to greener manufacturing.

The Coca-Cola Company last week announced new sustainable manufacturing goals including a commitment to reducing the carbon footprint of “the drink in your hand” by 25 percent, compared to 2010 levels, by 2020.

The company says this is the first-ever goal targeting the entire Coca-Cola end-to-end value chain, cutting CO2 across its manufacturing processes, packaging formats, delivery fleet, refrigeration equipment and ingredient sourcing. Coca-Cola says this will directly and indirectly prevent the release of 20 million metric tons of CO2 into the atmosphere.