Barriers to green supply chain management in Indian mining industries: a graph theoretic approach

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Abstract

A country's mining industry, despite its significant contributions to the country's economic growth, generally has a very poor public image because it is considered as a major environmental polluter. To acquire an improved social image, as well as to comply with government regulations, mining industries are increasingly implementing environmental management systems (EMS), cleaner production (CP), and adopting green supply chain management (GSCM) practices. GSCM focuses on a reduction of the adverse impacts of supply chain activities as well as a minimization of energy and material usage. This study focuses on the mining industry as a case study by which we will identify factors and sub-factors hindering GSCM implementation. A graph theoretic and matrix approach (GTMA) has been used to quantify the adverse impact of these barriers on GSCM implementation. An assessment of the inhibiting strength of the barriers will help decision makers rank them and decide a course of action that will make an optimum utilization of available resources during times of resource scarcity.

Introduction

Rapid worldwide industrialization requires an increase in supply chain activities. However, such activities are major factors in the depletion of natural resources, climatic problems, waste generation, harmful emission of gases, and disruptions in the ecosystem. To counter environmental deterioration, green supply chain management integrates environmental management principles with supply chain activities in order to either improve the environment or to preserve it so no further depletion is allowed. Therefore, green supply chain management is an important and emerging 21st century trend among all industrial activities, including mining. Organizations facing competitive regulatory and community pressures address these serious environmental issues by greening their supply chains, eliminating or minimizing waste in all forms including energy emissions, chemical, hazardous, and solid waste along the supply chain (Hervani et al., 2005). Material movement goes through several phases in the life cycle of any product, and each phase – such as the extraction of raw material, manufacturing, use and reuse, recycling and disposal – contributes significantly to the supply chain's ecological burden. To minimize the adverse environmental impact of their supply chains, various organizations adopt numerous environmental management strategies such as ISO 14001 certification, cleaner production, environmental management system, and life cycle analysis. In early environmental management frameworks, operating managers were involved only at arm's length. Separate organizational units had responsibility for ensuring environmental excellence in product development, process design, operations, logistics, marketing, regulatory compliance, and waste management (Toke et al., 2010). On the other hand, GSCM has been evolved as a more systematic and integrated approach that has the capability to develop win–win strategies for organizations, allowing them to achieve their profit and market share objectives along with increased ecological efficiency (Van Hock and Erasmus, 2000). Contrary to the concepts of traditional environmental management, GSCM accepts full responsibility of any firm towards its product, starting from raw material acquisition up to final use and disposal of products after end of life (Hart, 1995). The green craze exists in almost all modern sectors, and there is no exception for the mining sector.

Mining activities mainly consist of extraction, processing, and transportation of minerals from mining sites to market place. Indiscriminate and unplanned mining activities over the years have significantly contributed to environmental degradation. Low investment capacity, the use of traditional technologies, the poor working conditions of unskilled manpower lead to poor productivity and maintenance of equipment (O'Connor and Turnham, 1991). These working conditions ultimately result in higher energy consumption and waste production, thus establishing mining as a major polluting sector (Barve and Muduli, 2011). Pollution results from acid mine drainage formation, from the release of cyanide and other toxic chemicals (oil, petroleum products, solvents, acids, and reagents), the runoff of sediments, from emissions to air and fugitive dust emissions, and from noise, vibrations, and traffic (Botta et al., 2009), causing many health problems not only in miners but in nearby residents as well. In fact, mining operations such as drilling, blasting, crushing and allied operations are typically confronted with serious environmental complications and face the challenge of having to satisfy a diverse group of stakeholders' demands (Hilson and Nayee, 2002). There is an urgent need to reduce the negative impact of mining by striking a balance between mineral developments, on the one hand, and the restoration of the environment on the other.

Section snippets

Literature review

The Government of India promotes its mining sector to generate wealth and employment, but the increase in mining activity has resulted in increased environmental and health hazards. Mining companies in India are adopting various environmental management strategies to reduce the polluting impact of their supply chains to comply with government regulations and various social pressures from both national and international levels. This section categorizes literature on the Indian mining sector,

Solution methodology

A graph theoretic and matrix approach (GTMA) is adopted for quantifying the adverse impact of barriers on GSCM practices. Graph theory is a natural and powerful tool in combinatorial operation research, transport network, and the activity of stochastic processes useful for modelling and analysing various kinds of systems in many fields of science and engineering. The most common representation of a graph is by means of a diagram, in which the vertices are represented as points, and each edge as

Challenges to green management practices in the mining industry

Despite the development and adoption of various environmental management strategies, environmental hazards arising from various supply chain activities are not significantly reduced because implementing these technologies faces a lot of challenges.

To identify these challenges, industrial experts, academician, and government officials from directorate of mines government of Odisha were consulted. Three respondents from academics were selected, two of them having research interest in

Application of the model to the case illustration

The proposed decision-making methodology has been applied to study and to compare the inhibiting impacts of various GSCM implementation barriers in two iron ore extracting mines operating in Odisha, India. The data regarding the above attributes are collected from the two organizations with the help of a questionnaire formulated on the basis of weightage. Once the attributes are identified and Fi are calculated, the next step is to define the relative importance of the attribute rij suggested

Results and discussions

Index values of various barriers are given in Table 2. Index values of a particular barrier represent the degree of its adverse impact on GSCM practices. Higher values of index represent greater barriers to GSCM practices, whereas lower values represent lesser barriers.. The green barrier index calculated can be used to find out the fitness of the company for GSCM implementation. Lower index values indicate fewer adverse impacts and demonstrate that a particular company may be more fit for GSCM

Research implications

The present work can be significant for mining industries interested in implementing GSCM practices. The degree of success of GSCM implementation is greatly affected by the nature and intensity of these barriers. This article has quantified the effect of the barriers and explored the exact nature of these barriers. Knowledge of the inhibiting impact of various barriers will help decision makers to either take some precautions or to formulate strategies to make improvements in identified weaker

Conclusion

Green Supply Chain Management (GSCM) has been widely adopted and implemented by various sectors to reduce the environmental impact of their operations and, correspondingly, to gain an improved brand image and competitive advantage. Despite the advantages of GSCM, managers of many mining industries are reluctant to adopt GSCM practices due to the presence of these barriers. In fact, these barriers actually discourage other industries from adopting GSCM. It is therefore essential to quantify the

Acknowledgement

The second author (Kannan Govindan) was supported by a Grant from Forsknings-og Innovationsstyrelsen for ‘‘The International Network programme’’ (1681448) and Chinese Academy of Sciences (2008-318). The fourth author (Geng Yong) was supported by Natural Science Foundation of China (71033004), Chinese Academy of Sciences (2008-318), and Ministry of Science and technology (2011BAJ06B01).

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