Managing climate change risks in global supply chains: a review and research agenda

Climate change is forcing governments and businesses to explore mitigation strategies to avoid future catastrophe. There is an urgent need to manage climate change risks in global supply chains. Following a systematic literature review and text mining approach, 90 interdisciplinary articles between the years 2005 and 2018 were studied. Thematic and descriptive analysis identifies sources, consequences and control mechanisms for the climate change risks. It is found that climate change driven by extreme weather conditions significantly impacts food production, natural resources and transportation worldwide. This direct impact on food, mining and logistics sectors cascades into other interlinked global supply chain network. Climate change and supply chains are found to be mutually influencing each other through natural disasters and greenhouse gas (GHG) emissions respectively. A systems theory driven, novel supply chain risk management framework for managing climate change risks is proposed. The study contributes to supply chain risk management literature by capturing the nexus between climate change and supply chain management.

[1]  R. Nicholls,et al.  Indirect impacts of coastal climate change and sea-level rise: the UK example , 2012 .

[2]  Robert O. Schneider.  Climate change: an emergency management perspective , 2011 .

[3]  M. Christopher,et al.  Supply chain risk management: outlining an agenda for future research , 2003 .

[4]  Zaili Yang,et al.  Climate change and the adaptation strategies of ports: The Australian experiences , 2013 .

[5]  Pushpam Kumar.  Agriculture (Chapter8) in IPCC, 2007: Climate change 2007: Mitigation of Climate Change. Contribution of Working Group III to the Fourth assessment Report of the Intergovernmental Panel on Climate Change , 2007 .

[6]  Ki-Hoon Lee,et al.  Integrating carbon footprint into supply chain management: the case of Hyundai Motor Company (HMC) in the automobile industry , 2011 .

[7]  Carl Marcus Wallenburg,et al.  Dealing with supply chain risks , 2012 .

[8]  I. Nikolaou,et al.  The response of small and medium-sized enterprises to potential water risks: an eco-cluster approach , 2016 .

[9]  T. Okazumi,et al.  Lessons learned from two unprecedented disasters in 2011 – Great East Japan Earthquake and Tsunami in Japan and Chao Phraya River flood in Thailand , 2015 .

[10]  P. Sands.  The United Nations Framework Convention on Climate Change , 1992 .

[11]  Graeme Heron,et al.  Sensible operational choices for the climate change agenda , 2010 .

[12]  Pragya Nema,et al.  An overview of global climate changing in current scenario and mitigation action , 2012 .

[13]  Rafael Berlanga Llavori,et al.  Topic discovery based on text mining techniques , 2007, Inf. Process. Manag..

[14]  J. Sahu,et al.  Effect of process parameters on production of biochar from biomass waste through pyrolysis: A review , 2016 .

[15]  Annie Pye,et al.  Low carbon procurement: An emerging agenda , 2013 .

[16]  Olivier Lavastre,et al.  Supply chain risk management in French companies , 2012, Decis. Support Syst..

[17]  K. Cassman,et al.  Limited potential of no-till agriculture for climate change mitigation , 2014 .

[18]  S. Seuring,et al.  Environmental impacts as buying criteria for third party logistical services , 2010 .

[19]  Nicholas Stern,et al.  Current climate models are grossly misleading , 2016 .

[20]  I. Fulmer.  Editor's Comments: The Craft of Writing Theory Articles—Variety and Similarity in AMR , 2012 .

[21]  Mingzhou Jin,et al.  The impact of carbon policies on supply chain design and logistics of a major retailer , 2014 .

[22]  Venkat Venkatasubramanian,et al.  Optimizing efficiency‐robustness trade‐offs in supply chain design under uncertainty due to disruptions , 2011 .

[23]  A. Edmondson,et al.  METHODOLOGICAL FIT IN MANAGEMENT FIELD RESEARCH. , 2007 .

[24]  Abhijeet Ghadge,et al.  A Systems Approach for Modelling Supply Chain Risks , 2012 .

[25]  J. Lash,et al.  Competitive advantage on a warming planet. , 2007, Harvard business review.

[26]  Paul D. Williams,et al.  Should All Literature Reviews be Systematic? , 2000 .

[27]  A. Levermann,et al.  Climate economics: Make supply chains climate-smart , 2014, Nature.

[28]  Thomas K. Dasaklis,et al.  Supply chain management in view of climate change: an overview of possible impacts and the road ahead , 2013 .

[29]  Brian J. Meacham,et al.  Locating Backup Facilities to Enhance Supply Chain Disaster Resilience , 2008 .

[30]  Carl Marcus Wallenburg,et al.  Dealing with supply chain risks Linking risk management practices and strategies to performance , 2017 .

[31]  L. Jacxsens,et al.  Towards strategies to adapt to pressures on safety of fresh produce due to climate change , 2015 .

[32]  Anne-Wil Harzing,et al.  Google Scholar, Scopus and the Web of Science: a longitudinal and cross-disciplinary comparison , 2015, Scientometrics.

[33]  Z. Irani,et al.  Critical analysis of Big Data challenges and analytical methods , 2017 .

[34]  Gustavo M. Ugarte,et al.  Lean versus green: The impact of lean logistics on greenhouse gas emissions in consumer goods supply chains , 2016 .

[35]  Simon Buckle,et al.  Mitigation of climate change , 2009, The Daunting Climate Change.

[36]  R. Baumgartner,et al.  Intra‐Sectoral Differences in Climate Change Strategies: Evidence from the Global Automotive Industry , 2017, Business strategy and the environment.

[37]  Bin Shen,et al.  Market disruptions in supply chains: a review of operational models , 2017, Int. Trans. Oper. Res..

[38]  Michael W. Toffel,et al.  Engaging Supply Chains in Climate Change , 2012, Manuf. Serv. Oper. Manag..

[39]  A. Levermann,et al.  Make supply chains climate-smart , 2014 .

[40]  T. Comes,et al.  A critical review on supply chain risk – Definition, measure and modeling ☆ , 2015 .

[41]  Nishikant Mishra,et al.  An integrated lean and green approach for improving sustainability performance: a case study of a packaging manufacturing SME in the U.K. , 2019, Production Planning & Control.

[42]  H. Walker,et al.  Risk in supply networks , 2003 .

[43]  C. Green,et al.  The Impact on Global Greenhouse Gas Emissions of Geographic Shifts in Global Supply Chains , 2017 .

[44]  Zaili Yang,et al.  Risk and cost evaluation of port adaptation measures to climate change impacts , 2017, Transportation Research Part D: Transport and Environment.

[45]  C. Rosenzweig,et al.  Potential impact of climate change on world food supply , 1994, Nature.

[46]  Philip E. T. Lewis,et al.  Research Methods for Business Students , 2006 .

[47]  Yahaya Yusuf,et al.  Sustainable supply chain management: A case study of British Aerospace (BAe) Systems , 2012 .

[48]  Shigemi Kagawa,et al.  CO2 emission clusters within global supply chain networks: Implications for climate change mitigation , 2015 .

[49]  Moises Sudit,et al.  Impact Assessment , 2014, Cyber Defense and Situational Awareness.

[50]  D. Rousseau,et al.  Evidence in Management and Organizational Science: Assembling the Field's Full Weight of Scientific Knowledge through Syntheses , 2008 .

[51]  Martijn Gough.  Climate change , 2009, Canadian Medical Association Journal.

[52]  Manoj Kumar Tiwari,et al.  Sustainable procurement performance of large enterprises across supply chain tiers and geographic regions , 2018, Int. J. Prod. Res..

[53]  Akiko Aizawa,et al.  An information-theoretic perspective of tf-idf measures , 2003, Inf. Process. Manag..

[54]  양민선.  IPCC(Intergovernmental Panel on climate Change) 외 , 2008 .

[55]  Su-Yol Lee,et al.  Corporate Carbon Strategies in Responding to Climate Change , 2012 .

[56]  Xiaojun Wang,et al.  Effects of carbon emission reduction policies on transportation mode selections with stochastic demand , 2016 .

[57]  Agustín Rubio,et al.  Carbon footprint in Green Public Procurement: a case study in the services sector , 2015 .

[58]  A. Cerutti,et al.  Carbon footprint in green public procurement: Policy evaluation from a case study in the food sector , 2016 .

[59]  Samir Dani,et al.  Supply Chain Risk Management: Present and Future Scope , 2012 .

[60]  Inga-Lena Darkow,et al.  Energy-constrained and low-carbon scenarios for the transportation and logistics industry , 2016 .

[61]  M. Abé,et al.  Building Resilient Supply Chains against Natural Disasters: The Cases of Japan and Thailand , 2013 .

[62]  Evangelos Mitsakis,et al.  Impact assessment of extreme weather events on transport networks: A data-driven approach , 2015 .

[63]  Trevor S. Hale,et al.  Improving supply chain disaster preparedness: A decision process for secure site location , 2005 .

[64]  Jun Nakatani,et al.  A Practical Approach to Screening Potential Environmental Hotspots of Different Impact Categories in Supply Chains. Sustainability, 2015, 7, 11878-11892. , 2015 .

[65]  Jacques Leonardi,et al.  Assessing carbon footprint and energy efficiency in competing supply chains: Review - Case studies and benchmarking , 2012 .

[66]  A. Dai.  Increasing drought under global warming in observations and models , 2013 .

[67]  C. Jabbour,et al.  Past, present, and future low carbon supply chain management: A content review using social network analysis , 2019, Journal of Cleaner Production.

[68]  A. Bryman,et al.  The SAGE handbook of organizational research methods , 2009 .

[69]  Costas P. Pappis.  Climate Change, Supply Chain Management and Enterprise Adaptation: Implications of Global Warming on the Economy , 2010 .

[70]  Christopher S. Tang,et al.  Researchers' Perspectives on Supply Chain Risk Management , 2011 .

[71]  Ali H. Diabat,et al.  A carbon-capped supply chain network problem , 2009, 2009 IEEE International Conference on Industrial Engineering and Engineering Management.

[72]  Diane A. Mollenkopf,et al.  A Natural Resource Scarcity Typology: Theoretical Foundations and Strategic Implications for Supply Chain Management , 2012 .

[73]  Su‐Yol Lee.  Drivers for the participation of small and medium‐sized suppliers in green supply chain initiatives , 2008 .

[74]  Qinghua Zhu,et al.  Motivating low-carbon initiatives among suppliers: The role of risk and opportunity perception , 2018, Resources, Conservation and Recycling.

[75]  Anny Cazenave,et al.  The rate of sea-level rise , 2014 .

[76]  Gerard George,et al.  Climate change and management , 2014 .

[77]  David C. Wheeler,et al.  The Automobile Industry , 1990 .

[78]  Petr Matous,et al.  How Do Supply Chain Networks Affect the Resilience of Firms to Natural Disasters? Evidence from the Great East Japan Earthquake , 2015 .

[79]  Kuan Chong Ting,et al.  Lignocellulosic biomass feedstock transportation alternatives, logistics, equipment configurations, and modeling , 2012 .

[80]  Geraldine Ryan,et al.  The Importance of the Diverse Drivers and Types of Environmental Innovation for Firm Performance , 2016 .

[81]  Eric Ballot,et al.  The reduction of greenhouse gas emissions from freight transport by pooling supply chains , 2013 .

[82]  Edgar G. Hertwich,et al.  Towards demand-side solutions for mitigating climate change , 2018, Nature Climate Change.

[83]  Kevin P. Scheibe,et al.  Supply chain disruption propagation: a systemic risk and normal accident theory perspective , 2018, Int. J. Prod. Res..

[84]  D. Tranfield,et al.  Using qualitative research synthesis to build an actionable knowledge base , 2006 .

[85]  D. Deryng,et al.  Climate and southern Africa's water–energy–food nexus , 2014 .

[86]  M. Mercedes Maroto-Valer,et al.  An overview of current status of carbon dioxide capture and storage technologies , 2014 .

[87]  Brian J. Sauser,et al.  System-of-Systems Engineering Management: A Review of Modern History and a Path Forward , 2008, IEEE Systems Journal.

[88]  Christopher S. Tang.  Perspectives in supply chain risk management , 2006 .

[89]  Mark Pagell,et al.  Why Research in Sustainable Supply Chain Management Should Have No Future , 2014 .

[90]  Kieran P. Donaghy,et al.  Impacts and implications of climatic extremes for resilience planning of transportation energy: A case study of New York city , 2018 .

[91]  Hau L. Lee,et al.  Mitigating supply chain risk through improved confidence , 2004 .

[92]  Mark Pagell,et al.  Balancing priorities: Decision-making in sustainable supply chain management , 2011 .

[93]  Carl Marcus Wallenburg,et al.  The influence of relational competencies on supply chain resilience: a relational view , 2013 .

[94]  Bettina Wittneben,et al.  Climate change basics for managers , 2009 .

[95]  S. Vachon,et al.  Mitigation, Avoidance, or Acceptance? Managing Supplier Sustainability Risk , 2016 .

[96]  이지형.  Data Driven Approach의 시대 , 2018 .

[97]  J. Crisp,et al.  The Delphi method? , 1997, Nursing research.

[98]  D. Lobell,et al.  A meta-analysis of crop yield under climate change and adaptation , 2014 .

[99]  S. Yang,et al.  Robust supply chain strategies for recovering from unanticipated disasters , 2015 .

[100]  P. Gerber,et al.  Climate change mitigation and productivity gains in livestock supply chains: insights from regional case studies , 2016, Regional Environmental Change.

[101]  Duncan C. McFarlane,et al.  Modelling food sourcing decisions under climate change: A data-driven approach , 2019, Comput. Ind. Eng..

[102]  M. Burke,et al.  Adaptation to Climate Change: Evidence from US Agriculture , 2012 .

[103]  Alistair J. Hobday,et al.  Complex resource supply chains display higher resilience to simulated climate shocks , 2017 .

[104]  Muhammad Saad Memon,et al.  Sustainable and Resilient Supply Chain Network Design under Disruption Risks , 2014 .

[105]  Joseph Sarkis,et al.  The impact of carbon pricing on a closed-loop supply chain: an Australian case study , 2013 .

[106]  Lee-Ann Jaykus,et al.  Climate change and food safety: A review , 2010 .

[107]  Navid Sahebjamnia,et al.  Integrated business continuity and disaster recovery planning: Towards organizational resilience , 2015, Eur. J. Oper. Res..

[108]  P. Schönsleben,et al.  System-oriented supply chain risk management , 2009 .

[109]  G. Meehl,et al.  Climate extremes: observations, modeling, and impacts. , 2000, Science.

[110]  Justin S. Mankin,et al.  Unprecedented climate events: Historical changes, aspirational targets, and national commitments , 2018, Science Advances.

[111]  Tsan-Ming Choi,et al.  Supply chain risk analysis with mean-variance models: a technical review , 2016, Ann. Oper. Res..

[112]  Paul Chinowsky,et al.  Climate change risks to US infrastructure: impacts on roads, bridges, coastal development, and urban drainage , 2015, Climatic Change.

[113]  Nicholas Stern,et al.  Economics: Current climate models are grossly misleading , 2016, Nature.

[114]  Germaine H. Saad,et al.  Managing Disruption Risks in Supply Chains , 2005 .

[115]  P. Nieuwenhuis,et al.  Shipping or local production? CO2 impact of a strategic decision: An automotive industry case study , 2012 .

[116]  A. Fleming,et al.  Climate change risks and adaptation options across Australian seafood supply chains – A preliminary assessment , 2014 .

[117]  Zugang Liu,et al.  Consumer environmental awareness and competition in two-stage supply chains , 2012, Eur. J. Oper. Res..

[118]  T. Long,et al.  An exploration of intervention options to enhance the management of supply chain greenhouse gas emissions in the UK , 2016 .

[119]  Turan Paksoy,et al.  Environmentally conscious optimization of supply chain networks , 2014, J. Oper. Res. Soc..

[120]  Sonja J. Vermeulen,et al.  Climate change, food security and small-scale producers: Analysis of findings of the Fifth Assessment Report (AR5) of the Intergovernmental Panel on Climate Change (IPCC) , 2014 .

[121]  D. Tranfield,et al.  Producing a systematic review. , 2009 .

[122]  S. Schneider,et al.  A contribution of Working Groups I, II and III to the Third Assessment Report of the Intergovernment Panel on Climate Change , 2001 .

[123]  Inez Y. Fung,et al.  Global climate changes as forecast by Goddard Institute for Space Studies three‐dimensional model , 1988 .

[124]  Glyn A. Holton.  Defining Risk , 2004 .

[125]  F. Manto.  The organizational resilience , 2016 .

[126]  P. Dadhich,et al.  Developing sustainable supply chains in the UK construction industry: a case study , 2015 .

[127]  Young Won Park,et al.  Supply chain lessons from the catastrophic natural disaster in Japan , 2013 .

[128]  M. Marufuzzaman,et al.  Sustainable olefin supply chain network design under seasonal feedstock supplies and uncertain carbon tax rate , 2019, Journal of Cleaner Production.

[129]  D. Tranfield,et al.  Towards a Methodology for Developing Evidence-Informed Management Knowledge by Means of Systematic Review , 2003 .

[130]  S. Rahmstorf,et al.  A note on climate change adaptation for seaports: a challenge for global ports, a challenge for global society , 2013, Climatic Change.

[131]  Corinne Reich-Weiser,et al.  A discussion of greenhouse gas emission tradeoffs and water scarcity within the supply chain , 2009 .

[132]  Christodoulos A. Floudas,et al.  A multi-scale framework for CO2 capture, utilization, and sequestration: CCUS and CCU , 2015, Comput. Chem. Eng..

[133]  Peter Checkland,et al.  Systems Thinking, Systems Practice , 1981 .

[134]  Diane A. Mollenkopf,et al.  Natural resource scarcity and the closed‐loop supply chain: a resource‐advantage view , 2013 .

[135]  Stefan Minner,et al.  Dual sourcing under disruption risk and cost improvement through learning , 2016, Eur. J. Oper. Res..

[136]  G. Kovács,et al.  The sustainable agenda and energy efficiency , 2010 .

[137]  Kevin X. Li,et al.  How is Business Adapting to Climate Change Impacts Appropriately? Insight from the Commercial Port Sector , 2018 .

[138]  Brian J. Sauser,et al.  Systomics: Toward a Biology of System of Systems , 2010, IEEE Transactions on Systems, Man, and Cybernetics - Part A: Systems and Humans.

[139]  C. Finlayson.  Climate change: United Nations Framework Convention on Climate Change (UNFCCC) and Intergovernmental Panel for Climate Change (IPCC) , 2018 .

[140]  Alfredo Bueno-Solano,et al.  Dynamic impact on global supply chains performance of disruptions propagation produced by terrorist acts , 2014 .

[141]  Yongmei Bentley,et al.  The role of collaboration in the UK green supply chains: an exploratory study of the perspectives of suppliers, logistics and retailers , 2014 .

[142]  Joseph Sarkis,et al.  Quantitative models for managing supply chain risks: A review , 2015, Eur. J. Oper. Res..

[143]  Patrick Reumerman,et al.  Assessing wood use efficiency and greenhouse gas emissions of wood product cascading in the European Union , 2018 .

[144]  Ioannis Mallidis,et al.  Operations Research for green logistics - An overview of aspects, issues, contributions and challenges , 2011, Eur. J. Oper. Res..

[145]  K. Govindan,et al.  A sustainable supply chain for organic, conventional agro-food products: The role of demand substitution, climate change and public health , 2018, Journal of Cleaner Production.

[146]  Ana Beatriz Lopes de Sousa Jabbour,et al.  Contingency theory, climate change, and low-carbon operations management , 2017 .

[147]  Stefan Seuring,et al.  From a literature review to a conceptual framework for sustainable supply chain management , 2008 .

[148]  Angappa Gunasekaran,et al.  Constructing sustainable supply chain under double environmental medium regulations , 2014 .