Achieving carbon neutrality via supply chain management: position paper and editorial for IJPR special issue

Abstract

This special issue of the International Journal of Production Research, focuses on the ‘Carbon Neutrality’ and ‘SCM’. Nine articles have been selected for this special issue, and they cover various aspects to understand the manifestation of ‘Carbon Neutrality’ in supply chains, and to further illuminate how to achieve ‘Carbon Neutrality’ with supply chain innovation. This editorial provides a brief overview of the research domain, then introduces each article in the context of the state-of-the-art and highlights the contributions of selected papers to the field. Finally, the research perspectives are discussed.

KEYWORDS:

• Supply chain
• supply chain management
• carbon neutrality
• state of the art
• review

1. Introduction

Carbon neutrality is a state in which an organisation or individual balances the amount of greenhouse gas (GHG) emissions they produce with the amount removed from the atmosphere (Chen 2021; de Sousa Jabbour et al. 2019). The concept of carbon neutrality is rooted in the principle that reducing GHG emissions is necessary to mitigate the impact of climate change and global warming. Achieving carbon neutrality involves a combination of strategies, including reducing emissions, shifting to low-carbon technologies, and offsetting remaining emissions through the purchase of carbon credits or the use of carbon sinks (Ghosh, Jha, and Sharma 2020) Carbon neutrality is a critical goal for organisations, governments, and individuals worldwide, given the urgent need to mitigate the impact of climate change and global warming (Zhang et al. 2022a). By achieving carbon neutrality, organisations can reduce their carbon footprint and contribute to the global effort to reduce GHG emissions, thereby creating a more sustainable future.

Achieving carbon neutrality is essential to mitigating the impact of climate change and global warming (COP26 2021). Carbon dioxide and other GHGs are major contributors to the greenhouse effect, which is causing the planet's temperature to rise, leading to severe environmental impacts such as sea-level rise, flooding, droughts, and extreme weather events (De and Giri 2020; Doukas et al. 2021; Yao et al. 2021). In addition to environmental benefits, achieving carbon neutrality can bring several economic benefits. For example, organisations can reduce operational costs by improving energy efficiency and reducing waste. They can also improve their brand reputation and attract environmentally conscious customers, which can lead to increased sales and revenue (Attah–Boakye et al. 2022; Doukas et al. 2021; Trapp et al. 2020).

Supply chain engineering (Dolgui and Proth 2010) and Supply chain management (SCM) plays a critical role in reducing the carbon footprint of organisations. Supply chains are responsible for a significant proportion of GHG emissions, as it involves the transportation of goods and materials, the use of energy in manufacturing and distribution, and the disposal of waste (Ghosh et al. 2020; Zhang et al. 2022a). By implementing sustainable supply chain practices, organisations can reduce their carbon footprint and contribute to a more sustainable future. For example, they can reduce packaging waste by using more environmentally friendly materials, optimise logistics to reduce transportation emissions, and source materials from low-carbon suppliers. They can also implement circular economy practices, such as reusing and recycling materials, to reduce waste and emissions. Sustainable supply chain management (SSCM) practices not only help organisations reduce their carbon footprint, but also can lead to cost savings and increased efficiency. Moreover, achieving carbon neutrality can help organisations comply with regulations and standards related to environmental performance, which are becoming increasingly stringent (Higgins, Dibden, and Cocklin 2015; Touboulic, Matthews, and Marques 2018). By implementing SSCM practices, organisations can create a more resilient and sustainable business model that is better equipped to meet the challenges of a rapidly changing world.

2. Challenges and obstacles in achieving carbon neutrality through supply chain management

Achieving carbon neutrality through SCM is a complex and challenging task that involves multiple stakeholders, from suppliers and manufacturers to logistics providers and retailers. Despite the growing interest in reducing carbon emissions and mitigating climate change, there are several challenges and obstacles that hinder the progress towards carbon neutrality. Here are some of the most significant challenges and obstacles.

2.1. Limited control or lack of visibility over the supply chain

Many companies struggle to achieve carbon neutrality because they have limited visibility and control over their entire supply chain. The supply chain is often made up of multiple tiers of suppliers and subcontractors, making it difficult to track emissions and ensure compliance with carbon reduction goals. Additionally, the lack of standardisation in emissions reporting and accounting practices across the supply chain adds to the complexity. Companies may not have access to all the data necessary to make informed decisions and take effective action towards reducing emissions. Companies face significant challenges in achieving carbon neutrality due to limited visibility and control over their supply chain, which consists of multiple tiers of suppliers, making it difficult to track emissions and ensure compliance (Spiller 2021; Touboulic, Matthews, and Marques 2018). The lack of standardisation in emissions reporting and accounting practices across the supply chain adds complexity (Spiller 2021). Additionally, overreliance on secondary data and incomplete or unreliable data from suppliers and customers make it challenging to set ambitious decarbonisation targets (Spiller 2021). Complex supply chain networks also pose challenges in identifying environmentally critical sectors and clusters for Green SCM (Tokito 2018; Touboulic, Matthews, and Marques 2018). To address these issues, companies need to collaborate with suppliers to gather data and establish consistent reporting standards (Spiller 2021) and improve visibility for future resiliency and sustainability (Koh et al. 2013).

2.2. Financial constraints

Implementing carbon reduction measures across the supply chain can be expensive, and many companies face financial constraints in pursuing their carbon neutrality goals. These costs can include investment in new technologies and infrastructure, training and education, and the potential for supply chain disruptions during the transition (Spiller 2021). Furthermore, the costs associated with carbon reduction measures may be higher for companies that are dependent on suppliers in regions with weak carbon regulations or inadequate infrastructure for renewable energy (Zhi et al. 2019).

The transition to a net-zero value chain requires businesses to identify and invest in carbon-reduction levers, such as renewable energy, energy-efficient technologies, and low-carbon materials (Spiller 2021). However, there is significant uncertainty with regards to the cost and technical feasibility of these levers, which can make it challenging to prioritise investments. Although emissions reduction strategies are adopted, there is a gradual increase in green management costs that could affect stakeholder motivation (Mallidis et al. 2014).

Retailers face trade-offs between holding costs, transportation costs, and carbon emissions costs, making it difficult to choose effective emissions reduction strategies (Sarkar et al. 2016). Increased operating costs add to the challenge for supply chain members in implementing successful emissions reduction strategies (Zhi et al. 2019). A recent study has noted that the primary obstacle preventing firms from achieving carbon neutrality is the significant upfront investment costs. This financial barrier is understandable since most companies need to make significant investments to upgrade their machinery and vehicles to reduce emissions. Additionally, the generation of renewable energies also requires a substantial amount of investment (Song et al. 2017).

Despite this, most firms remain optimistic about the potential return on investment if they have the funds to invest. To overcome this obstacle, companies must adopt a long-term approach to carbon neutrality and invest in sustainable practices that may be initially costly but ultimately lead to cost savings in the long run. Companies can also explore options for financing such investments through partnerships or government incentives (Spiller 2021). Achieving carbon neutrality requires technical expertise and operational capacity, which may be lacking in some companies or industries. For example, some companies may lack the expertise to develop and implement carbon reduction strategies, or they may lack the operational capacity to track and manage their carbon emissions effectively (Spiller 2021; Zhi et al. 2019).

2.3. Lack of awareness and commitment

Consumer awareness and demand for sustainable products and practices are increasing, but many consumers still prioritise price and convenience over environmental concerns. This can create a mismatch between the demand for sustainable products and the supply, leading to slow adoption and implementation of carbon reduction measures. The challenge of achieving carbon neutrality for businesses lies in raising consumer awareness about its importance. Liu et al. (2021) found that consumers’ purchasing intentions for low-carbon products are influenced by factors such as delivery time and satisfaction with the products, rather than income or awareness. However, urgent national actions towards carbon neutrality have highlighted the need for businesses to involve consumers in maintaining a carbon-efficient supply chain (Olatunji et al. 2019).

The difficulty lies in companies understanding stakeholder pressures due to awareness gaps (Jabbour et al. 2015). Zhang et al. (2022a) conducted a study that revealed ‘Lack of awareness’ as a major obstacle, owing to the novelty of the carbon neutrality concept. This issue is pervasive across all stakeholder groups, including consumers, customers, suppliers, and employees. Achieving carbon neutrality requires collaboration and communication among multiple stakeholders, including suppliers, customers, regulators, and NGOs. However, these stakeholders may have different priorities, interests, and perspectives, which can make collaboration and communication challenging.

3. Strategies for achieving carbon neutrality through supply chain management

3.1. Developing a sustainable supply chain

Developing a sustainable supply chain involves assessing the environmental impact of all activities within the supply chain and identifying areas where emissions can be reduced. To achieve this, businesses should adopt a life-cycle approach to SCM, which considers the environmental impact of products and processes from sourcing to disposal. This involves selecting suppliers that adhere to sustainable practices, such as using eco-friendly materials, reducing waste, and increasing energy efficiency. Additionally, businesses can implement sustainable practices in their manufacturing processes, such as substituting for sustainable materials, using renewable energy sources and optimising production processes to reduce waste and emissions. Developing a Sustainable Supply Chain can help to achieve carbon neutrality by implementing tools and techniques to measure an organisation's carbon footprint (CFP) and optimising operations to reduce CFP. Mallidis et al. (2014) proposed a cost-effective and environmentally friendly methodology for a South-Eastern European company, which suggested using shared warehouses and transportation modes to reduce the average emission of CO2 from the supply chain.

Several studies have proposed using existing technologies and strategies to calculate carbon footprint across the supply chain. For instance, Shaw et al. (2013) developed a multi-objective programming model that optimises total supply chain cost and direct and indirect carbon emissions. This model helps managers modify operational strategies to reduce logistics costs and carbon footprint. Tseng and Hung (2014) developed a strategic decision-making model that combines the social cost of CO2 emissions with traditional operational costs to reduce carbon footprint in textile industries with manufacturing plants and warehouses in different countries. They suggested considering different waste management strategies to create a more sustainable supply chain. Organisations can also use alternative methodologies to meet sustainability obligations. For example, carbon cap and trade can be used to create low-carbon chance-constrained sustainable supply chains.

Garcia-Alvarado, Paquet, and Chaabane (2016) examined the interaction between strategic and tactical decisions in the cap-and-trade mechanism and concluded that carbon abatement strategies, capacity expansion, and carbon management schemes are critical to balancing environmental and economic goals. The study finds that investment and capacity sizing strategies impact total profit and that pricey carbon allowances reduce profit but increase investments while higher assistance factors result in greater environmental stability and higher profits. Meanwhile, Shaw et al. (2016) proposed a model for designing a green supply chain network that takes into account carbon emissions and carbon trading. The model determines the optimal flow of materials and emissions across the network, and addresses uncertainties of supplier, plant, warehouse capacities, and demand. The proposed models demonstrate that changes in probability and carbon credit price affect the flow of materials, number of plant openings, and variable costs and emissions. Companies can also use advanced technologies like drones as substitutes for traditional logistics to reduce carbon emissions.

Galve et al. (2016) proposed a mixed-integer sustainable vehicle routing model to optimise delivery through drones for the last-mile delivery system, which successfully reduced the use of fuel in logistics and the supply chain cost. Sustainable sourcing can reduce carbon emissions by choosing different construction materials. Hossain, Sohail, and Ng (2019) developed a systematic approach to identify sustainable sourcing methods for construction materials in Hong Kong. The study evaluated the environmental impact of the existing sourcing methods for selected materials and identified hotspots. The results showed that sustainable sourcing could significantly reduce environmental impacts, with potential for reducing GHG emissions by 28% compared to the base scenario. The study also identified nine potential sustainable sourcing locations, with Taiwan as the preferred option for five materials. Alternative sourcing methods could significantly reduce GHG emissions for individual raw materials. Aljuneidi and Bulgak (2019) proposed reverse logistics with a hybrid manufacturing system as a solution that minimised carbon emissions and transportation costs. It is also helpful in finding operational decisions for different facility location problems.

Overall, developing a Sustainable Supply Chain can significantly help an organisation to achieve carbon neutrality by reducing CFP through the implementation of different tools and techniques, alternative methodologies, and advanced technologies.

3.2. Implementing renewable energy sources

Implementing renewable energy sources is an effective way to reduce emissions in the supply chain. Businesses can generate their electricity from renewable sources such as solar, wind, and hydroelectric power, or purchase renewable energy credits to offset carbon emissions from conventional energy sources. Implementing renewable energy sources can help businesses reduce their carbon footprint and energy costs while enhancing their reputation as being environmentally responsible. Organisations are investing in developing sustainable supply chains by implementing various strategies to reduce their carbon footprint and improve their environmental impact. One of these strategies involves adapting pricing strategies and making dynamic decisions based on real-time emission levels and carbon tax prices to remain competitive and avoid losing business (Ma et al. 2018). Nakamichi, Hanaoka, and Kawahara (2016) estimated the CO2 emissions of an automobile company's supply chain in Asia and compared different scenarios considering the geographical location of suppliers, assembly plants, and markets, as well as investment costs. The study found that cross-border supply chain CO2 emissions were 1.4 times larger than domestic plant emissions. The study suggests that manufacturers should consider plant locations based on environmental and economic benefits. This approach aims to reduce the environmental impact of production processes and improve the sustainability of supply chains.

In order to ensure the long-term stability of low-carbon supply chains through energy security, manufacturers are taking on the main responsibility of the supply chain, enhancing their learning capabilities, and adopting control strategies to help the system survive from disruptions (Lin et al. 2021). These measures improve the resilience of the supply chain and ensure its sustainability. Another approach involves weighing up the full value chain impact of different raw material options, including their alternatives, to optimise the use of raw materials and minimise carbon emissions (Ibn-Mohammed et al. 2016). This practice promotes the use of sustainable materials and reduces the environmental impact of production processes. Zhang et al. (2022a) propose optimising delivery schedules for logistics companies using a model that takes into account various factors such as traffic conditions and vehicle energy consumption and shows that it is effective in reducing CO2 emissions. Overall, organisations are investing in developing sustainable supply chain by implementing various strategies such as process improvement, control strategies, and renewable material options. These practices aim to improve the sustainability of supply chain, reduce environmental impact, and ensure long term stability.

3.3. Optimising transportation and logistics

Transportation and logistics account for a significant portion of the carbon footprint of the supply chain. To reduce emissions, businesses can optimise their transportation and logistics operations by using alternative transportation modes such as rail and sea transport, consolidating shipments, and reducing the distance travelled. Additionally, businesses can encourage their suppliers to adopt sustainable transportation practices and use low-emission vehicles. Optimising transportation and logistics not only reduces emissions but also enhances efficiency and reduces costs. Optimising transportation and logistics in the supply chain can play a significant role in achieving carbon neutrality. Researchers have explored several strategies to reduce carbon emissions, including the impact of transportation mode choice, demand consolidation, and decreased trip spacing (Glock and Kim 2015). Tokito (2018) suggested that collaborative efforts between suppliers and buyers in high emission clusters and high-priority sectors can effectively reduce CO2 emissions associated with the final demand for transport equipment. An integrated supply chain can coordinate transport and inventory decisions to reduce overall supply chain costs and carbon costs, leading to a win-win situation in low-carbon management (Daryanto, Wee, and Astanti 2019).

To minimise transport time and reduce carbon emissions, suppliers should work together to coordinate their efforts (McKinnon 2016). CO2 emissions minimisation targets lead to less frequent order delivery, reducing retailers’ transport costs and CO2 emissions while increasing holding and backorder costs (Mallidis et al. 2014). Cooperative freight systems can significantly reduce CO2 emissions and mitigate the environmental impact of urban freight transport (Taniguchi and Van Der Heijden 2000). Efficient and low-carbon transport scheduling can reduce and improve the negative environmental impacts of logistics. Recent studies have clearly interlinked supply chain strategies and their environmental consequences (Acquaye et al. 2014). In conclusion, optimising transportation and logistics in the supply chain can help to achieve carbon neutrality by reducing carbon emissions associated with transportation and promoting collaborative efforts between suppliers and buyers.

3.4. Collaborating with suppliers and partners

Collaboration with suppliers and partners is essential to achieving carbon neutrality. Businesses should work with their suppliers to identify areas where they can reduce emissions, implement sustainable practices, and share best practices (Gong et al. 2018). Collaboration with partners can also lead to the development of innovative solutions to reduce emissions, such as using green technologies and implementing circular economy practices. Collaboration with suppliers and partners not only reduces emissions but also enhances sustainability throughout the supply chain. Collaborating with suppliers and partners in the supply chain is a critical strategy for achieving carbon neutrality. Efficient resource allocation and maximising energy efficiency are key issues in low carbon supply chains, which can be addressed through collaboration (Shen et al. 2017). Coordinated contracts in low carbon supply chains can improve both economic and environmental performance by balancing carbon reduction and pricing decisions (Lin, 2012). Blanco, Caro, and Corbett (2017) showed that collaboration within the supply chain is important for implementing emission reduction strategies. Tokito (2018) suggested that collaboration in supply chain in high emission clusters and high-priority sectors can effectively reduce CO2 emissions associated with the final demand for transport equipment.

According to Yu, Zhou, and Shi (2020), information sharing strategies across the supply chain can incentivize suppliers to conduct carbon reduction through demand information sharing, as manufacturing technology upgrades and consumer green awareness can put pressure on the whole chain. Bai, Sarkis, and Dou (2017) demonstrated that a critical low carbon management strategy for companies is to collaborate with suppliers and exchange carbon knowledge to build trusting relationships. Overall, these studies emphasise the need for collaboration and innovative strategies to achieve carbon neutrality and reduce greenhouse gas emissions in various industries.

3.5. Measuring and reporting progress

This involves setting targets and tracking emissions across the entire supply chain, including the emissions of suppliers and partners. Businesses should use transparent reporting mechanisms and communicate their progress to stakeholders, including customers, investors, and regulators (Zhang, Yang, and Yang 2023). Measuring and reporting progress not only demonstrates the commitment of businesses to sustainability but also enables them to identify areas where they can improve and enhance their reputation and competitive advantage in the market. Measuring and reporting progress in supply chain sustainability is crucial for achieving carbon neutrality. The complexity of supply chains, with multi-layered processes and global inputs, makes it difficult for companies to benchmark their environmental performance against industry standards or competitors. Standardising methods for measuring and benchmarking environmental sustainability can help address this complexity and inform supply chain performance (Acquaye et al. 2014).

Moreover, measuring emissions not only brings direct operational benefits but also adds strategic value by informing decision-making and goal setting for carbon reduction initiatives (Blanco, Caro, and Corbett 2017). However, to meet the comprehensiveness criteria for carbon reporting, access to relevant data is essential. Comprehensiveness criteria for carbon reporting cannot be met using existing data, and manually collecting information on emission sources in the downstream sales chain is time-consuming and ineffective (Lenzen and Murray 2010). Harmonising measurement standards in the supply chain is necessary to ensure accurate and comparable reporting of carbon emissions. Education and training are required to facilitate the difficult application of organisational carbon emissions measurement (Huang et al. 2022). While there are several standards available for organisations to use as a reference, further development could make them more relevant to different supply chains and organisational structures in different industries (Wong, Tai, and Zhou 2018).

3.6. Government regulation and policies

Government regulations can play a crucial role in achieving carbon neutrality by implementing policies that incentivize companies to reduce their greenhouse gas emissions. Various low carbon policies can be introduced, such as emissions trading schemes, emission standards, and subsidies, to encourage companies to adopt low-carbon management practices. The effectiveness of such policies varies depending on the industry and the company's situation. Furthermore, when companies have a better understanding of low-carbon management practices, they are less reliant on new national environmental legislation. Policymakers can introduce targeted policies that can improve energy efficiency and reduce carbon emissions effectively. Regulators can also adopt less intrusive, stakeholder-driven approaches to encourage companies to adopt low-carbon management practices, thereby mitigating climate change.

Many countries have implemented legislative measures and market-based strategies to reduce emissions and provide economic benefits to businesses. The study shows that different low carbon policies can have different impacts on companies depending on their situations and needs. Zhi et al. (2019) argued that high levels of subsidies can incentivize suppliers to adopt cooperative strategies in the short term, but it may not lead to long-term cooperation. In contrast, Attah–Boakye et al. (2022) suggested that companies with more knowledge of low-carbon management culture can reduce their need for new national environmental legislation. Policymakers can effectively achieve cleaner production in industries with high scores by introducing emission standards or emissions trading schemes. Targeted policies can help to improve energy efficiency and effectively reduce carbon emissions. Regulators can also use less intrusive, stakeholder-driven approaches to encourage companies to adopt low-carbon management practices.

Figure 1 summarises the challenges, obstacles and strategies for achieving carbon neutrality through SCM.

Figure 1. A framework for achieving carbon neutrality through supply chain management-Strategies and Challenges (CNSCM).

Carbon neutrality supply chain management framework to enable the transition towards carbon neutrality and net zero.

4. Summary of articles published in this special issue

This special issue of the International Journal of Production Research, focuses on the ‘Carbon Neutrality’ and ‘SCM’. Nine articles have been published in this special issue, and they cover various aspects to understand the manifestation of ‘Carbon Neutrality’ in supply chains, and to further illuminate how to achieve ‘Carbon Neutrality’ with supply chain innovation. This editorial provides a brief overview of each article and highlights their contributions to the field.

He et al. (2022) analysed the role of government regulations and policies in motivating suppliers and businesses to make strategic decisions to ensure carbon neutrality. The article looks at how the government, power plant, and farmer make decisions in a straw-based bioenergy supply chain in which they are not perfectly rational. The researchers develop and compares two penalty policies, a static policy and a dynamic one, to see which one works better. The findings show that a dynamic penalty policy works better than a static one and that the proportion of farmers and power plants who choose to use bioenergy affects the government's decisions. The article provides some policy implications for the government's regulation policies in a bioenergy supply chain. Overall, the article shows that when the players are not perfectly rational, it is important to have policies that take this into account to make better decisions.

Ali et al. (2022) aimed to examine the historical greenhouse gas emissions associated with household food consumption in eight English regions and four nations in the UK. The study found that all areas examined showed potential for a decrease in greenhouse gas emissions and lower household food costs through transitioning to healthier diets. However, there was no clear pattern of significant associations between the different areas. The study recommends prioritising local or regional policies to ensure affordable healthy, carbon-neutral diets. The research adds to the growing focus on carbon-neutral food supply chains driven by consumer demand for sustainable food and external supply chain disruptions. The study highlights the need for local policymakers to find innovative solutions to future-proof sustainable supply of healthy food to all communities. The study also notes a lack of clear consensus on benchmarking resilience and sustainability indicators for food supply chains, given geographical variations in social, economic, and environmental needs.

Kong, Liu, and Chen (2022) examined how the Maritime Supply Chain (MSC) can reach carbon neutrality through collaborative supply chain management. The study explores various stakeholders such as ports, shipping companies, government, and market and how they can work together to reduce CO2 emissions. The research finds that reducing carbon emissions requires a balance between environmental concerns and profit motives. The study concludes that achieving carbon neutrality in the MSC requires the participation of all stakeholders and recommends that companies invest in carbon abatement technology, alternative energy sources, and operational optimisation while raising public awareness about low-carbon lifestyles.

Xia et al. (2022) highlighted the impact of financing decisions on carbon neutrality and corporate profits in organisations. The research emphasises that low-carbon production alone cannot compensate for the negative effects of market competition on profits, and financing plays a crucial role in low-carbon supply chains. The study recommends low-carbon manufacturers to strengthen publicity of low-carbon products and pursue product differentiation and cooperation with downstream retailers, while those producing ordinary products should focus on product differentiation and horizontal cooperation with competitors to exchange advantageous resources.

Zhang et al. (2022b) studied how logistics companies can reduce their Carbon dioxide (CO2) emissions by optimising their delivery schedules. They propose a model that can be used to optimise delivery schedules for both fossil-fuel-powered and electric-powered vehicles. They suggested that logistics companies can reduce their carbon emissions by optimising their delivery schedules. This can be done by using models that take into account various factors such as traffic conditions and vehicle energy consumption.

Wang and Zhao (2022) aimed to determine the essential factors for reducing carbon footprint within a resilient supply chain, as well as to develop a conceptual framework for empirical research and an action plan to achieve carbon neutrality. Collaborative planning, forecasting, and replenishment are significant in supply chain collaboration, while visibility and velocity are crucial for agility. Collaborative planning, forecasting, and replenishment (CPFR) influences supplier and customer engagement, while supply chain intelligence impacts customer engagement. Standardisation and parallel processes impact supplier spending in supply chain flexibility.

Sheng, Feng, and Liu (2022) explored the impact of digital transformation on low-carbon operations management practices (LOMP) in Chinese manufacturing firms, with the goal of achieving carbon neutrality. The results indicated that digital transformation had a positive influence on LOMP and that the three dimensions of LOMP acted as mediators in the relationship between digital transformation and carbon performance. Additionally, the study revealed that low-carbon products played a mediating role in the association between digital transformation and economic performance. However, the researchers discovered that CEO ambivalence weakened the impact of digital transformation on LOMP.

Huang et al. (2022) focused on the role of manufacturers, who are responsible for a significant portion of carbon emissions, and examine how they can transform their production processes to become more environmentally friendly. The study finds that under cap-and-trade policy, manufacturers with different abatement efficiencies adopt different operational strategies. The manufacturer with low costs invests more in emission reduction and then sells excess emission permits to its competitor. However, this action also strengthens its rival's competitiveness in the product market. On the other hand, the manufacturer with high costs prefers to buy carbon emission permits to maintain its current market share. Surprisingly, the study reveals that cap-and-trade policies can result in industry collusion, where manufacturers reduce competition and improve their power and profits by decreasing overall output and using a different product strategy.

Ma, He, and Gu (2022) examined carbon neutrality in tourism and found that competition between low-carbon scenic spots reduced the low-carbon level of tourism products and profit of the supply chain network (LTSC). Low-carbon preference of tourists stimulated emission reduction activities and increased demand and profit. Horizontal cooperation raised retail prices, while vertical cooperation lowered them. Cooperation improved low-carbon levels when tourists were more sensitive to low-carbon products from one agency than its competitors. Profit increased when tourist demand sensitivity to retail price met a certain condition.

5. Conclusion and future research agenda (the conceptual model)

Achieving carbon neutrality through supply chain is a complex process that requires significant effort and coordination among all stakeholders involved. However, it is also clear that this is a critical step in the fight against climate change and the pursuit of a sustainable future. To achieve carbon neutrality through supply chain, it is important to implement a comprehensive strategy that takes into account the entire lifecycle of a product or service, from raw material sourcing to end-of-life disposal and circular economy practices. This may involve a range of measures, including increasing the use of renewable energy, reducing waste and emissions, optimising transportation and logistics, and engaging suppliers to improve their environmental practices. In addition to these measures, it is also important to set ambitious and measurable targets for carbon reduction, track progress towards these targets, and report transparently on performance. Collaboration among all stakeholders, including suppliers, customers, and regulators, is essential to achieving success. While achieving carbon neutrality through supply chain is a significant challenge, it is also an opportunity to drive innovation, reduce costs, and create value for stakeholders across the value chain. By taking action now, businesses can demonstrate leadership in the fight against climate change and position themselves for success in a low-carbon future, which requires both resiliency and sustainability. As the importance of sustainability in SCM continues to grow, there are several promising future directions for research in this area.

First, in recent years, public concern over global warming and CO2 emissions has risen, prompting researchers to develop new methodologies, tools, and technologies to improve the sustainability of existing supply chains. However, few studies have examined the gaps in current practices and sustainability goals for sustainable development. Future research should focus on a comprehensive evaluation system that considers both environmental and social performance to assess the sustainability of supply chains. This could include the development of metrics and standards that account for the social and environmental impact of supply chain operations.

Second, it is also important to keep identifying new barriers to the implementation of sustainable supply chain practices and develop strategies to overcome them. This could involve conducting research to better understand the motivations and barriers of different stakeholders in the supply chain, such as suppliers, customers, and employees. Another promising direction for future research is to explore the use of emerging technologies to promote sustainable supply chain practices. Technologies such as blockchain, artificial intelligence, and the Internet of Things have the potential to improve supply chain transparency, traceability, and efficiency, which can in turn promote sustainability (Koh, Dolgui, and Sarkis 2020; Manimuthua et al. 2022; Pournader et al. 2022). Researchers can work with companies to pilot these technologies and evaluate their effectiveness in promoting sustainability.

Third, future research should examine the impact of social responsibility on the implementation of sustainable supply chain practices, including the role of stakeholder engagement and the effect of social pressure and regulations on organisational behaviour. Investigating the integration of social responsibility into supply chain sustainability, including the development of frameworks and guidelines that support the implementation of socially responsible supply chain practices. Fourth, future studies should also focus on evaluating the economic impact of sustainable supply chain practices, including the costs and benefits of implementing sustainable supply chain practices and the potential impact on profitability. Fifth, researchers should also examine the role of consumer awareness in driving the adoption of sustainable supply chain practices, and the potential impact of consumer behaviour on the implementation of sustainable supply chain practices.

Lastly, methodologically it has been observed that the majority of studies use modelling and simulation methods, with only a few employing interview or survey designs. While theoretical extensions in research are important, it is also critical to engage with the industrial practice. Therefore, future research should focus on other available methods to gain a more comprehensive understanding of the subject. For instance, both quantitative and qualitative research can be conducted to analyse the impact of carbon neutrality initiatives on the supply chain's economic, environmental, and social performance. A mixed-methods approach can be used to combine both types of data and gain deeper insights into the complexities of achieving carbon neutrality in supply chains. Longitudinal research can be conducted to track progress over time, identify factors that contribute to success, and challenges that arise along the way. Additionally, comparative research can be conducted to compare approaches and outcomes of different companies or supply chains, which can help identify best practices and strategies. By pursuing these and other research directions such as resiliency management (Ivanov 2023), we can advance our understanding of the challenges and opportunities related to sustainable supply chains and identify innovative solutions to drive progress towards sustainability goals.

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Additional information

Notes on contributors

S. C. Lenny Koh

Professor SC Lenny Koh is a Chair Professor in Operations Management, Director of Advanced Resource Efficiency Centre (AREC), Co-Head of Energy Institute at The University of Sheffield, UK. She has over 354 publications (H index 70) in the forms of journal papers, books, edited books, edited proceedings, edited Special Issues, book chapters, conference papers, technical papers and reports. Her research focuses on the intersections of supply chain and digitalisation X to address energy, climate and resources sustainability and resiliency. Her work appears in top quality and high impact journals such as International Journal of Production Research (IJPR); International Journal of Operations and Production Management; European Journal of Operational Research; International Journal of Production Economics; OMEGA; Supply Chain Management: An International Journal; Production Planning and Control; Applied Energy; Resources, Conservation and Recycling; Environmental Science and Technology; Renewable and Sustainable Energy Review; Energy and Environmental Science; Nature; Nature Plants; Nature Electronics; Nature Scientific Reports; Nature Geoscience and Nature Communications Earth and Environment. Her large scale interdisciplinary research funded by EPSRC, BBSRC, NERC, ESRC, EU, Leverhulme Trust, Innovate UK, UKRI GCRF, industry and government have led to new methods, models, concepts / thinking and tools. Her research has been translated into Microsoft Cloud technology (with big data and business intelligence analytics) powered software tools (SCEnAT suites) for supply chain resources management, which are used by industry from diverse sectors.

Fu (Jeff) Jia

Professor Fu (Jeff) Jia is the Chair Professor of Supply Chain Management at the York Management School, University of York. His research interests include supply relationship management in a cross-cultural context, global sourcing, supply chain learning and innovation, and sustainable supply management. He is currently leading a project team investigating the adoption of new technologies in SCF. Prof. Jia has an extensive track record of publications in supply chain management and logistics journals including Journal of Operations Management, International Journal of Operations and Production Management (IJOPM), Supply Chain Management: An International Journal, International Journal of Production Economics, Journal of Business Logistics, International Business Review, Technological Forecasting and Social Change, Journal of Cleaner Production, Journal of Purchasing and Supply Management, and International Journal of Logistics Management. Prof. Jia is also an Associate Editor and a Guest Editor of two Special Issues (The Role of Digital Transformation in Empowering Supply Chain Finance; The Fourth Industrial Revolution: Technologies' Disruption on Operations and Supply Chain Management) of the International Journal of Operations and Production Management. He also serves as an associate editor for the Journal of Purchasing and Supply Management, sits on the editorial review board of Industrial Marketing Management.

Yu (Jack) Gong

Dr. Yu (Jack) Gong is Lecturer (Assistant Professor) in Operations Management, Director CORMSIS Business Liaison (China) at Southampton Business School, University of Southampton, UK. He obtained his PhD at the University of Exeter (2013-2016). He has publications in several high quality journals such as: International Journal of Operations & Production Management (IJOPM), International Journal of Production Economics (IJPE), International Journal of Production Research (IJPR), Industrial Marketing Management (IMM), Transportation Research Part D: Transport and Environment (TRD). He has served as a guest editor for the Special Issue of “Multi-tier Sustainable Supply Chains Management for Global Sustainability” for IJPR. He is also a reviewer of IJOPM, IJPE, IJPR and Transportation Research Part E: Logistics and Transportation Review. His main research interests are sustainable supply chain management and supply chain innovation.

Xiaoxue Zheng

Professor Xiaoxue Zheng is a Professor in Business Administration at Minjiang University and European University Cyprus. She was a Visiting Scholar to University of Windsor, Canada 2017/5-2018/6. Her research interests include closed-loop supply chain management, non-cooperative and cooperative game theories, and multi-goal planning optimization. She has published more than 30 papers in journal such as Omega, International Journal of Production Economics, Transportation Research Part E: Logistics and Transportation Review, among others. Her paper published in International Journal of Production Economics has been selected as an ESI paper. She is also a reviewer of Transportation Research Part E, European Journal of Operational Research, International Journal of Production Research, International Journal of Strategic Property Management, and others.

Alexandre Dolgui

Professor Alexandre Dolgui is an IISE Fellow, Distinguished Professor, and the Head of Automation, Production and Computer Sciences Department at the IMT Atlantique, campus in Nantes, France. His research focuses on manufacturing line design, production planning and supply chain optimisation. His main results are based on the exact mathematical programming methods and their intelligent coupling with heuristics and metaheuristics algorithms. He is the co-author of 5 books, the co-editor of 30 books or conference proceedings, the author of more than 300 refereed journal papers as well as over 400 papers in conference proceedings. He is the Editor-in-Chief of the International Journal of Production Research (IJPR).