Corporate Social Responsibility Practices in the U.S.: Using Reverse Supply Chain Network Design and Optimization Considering Carbon Cost

Bandar Alkhayyal

doi:10.3390/su11072097

Abstract

A research model using the market price for greenhouse gas (GHG) emissions illustrates how the policies, and economic and environment implications of the carbon price can be formulated using a deterministic equilibrium model. However, with increasing carbon costs, the optimal reverse supply chain (RSC) system is being required to adapt and has undergone many distinct shifts in character as it seeks out new configurations through which costs may be effectively managed and minimized. The model was studied comprehensively in terms of quantitative performance using orthogonal arrays. The results were compared to top-down estimates produced through economic input-output life cycle assessment (EIO-LCA) models, providing a basis to contrast remanufacturing GHG emission quantities with those realized through original equipment manufacturing operations. Introducing a carbon cost of $40/t CO2e increased modeled remanufacturing costs by 2.7%, but also increased original equipment costs by 2.3%. The research presented in this study puts forward the theoretical modeling of optimal RSC systems and provides an empirical case study concerning remanufactured appliances, an area of current industrial literature in which there is a dearth of study.

Highlights

The circular economy concept was developed as an alternative to the prevailing production paradigm of treating the environment as a waste reservoir, and was first raised four decades ago in a report submitted to the European Commission [1]
The remanufacturing outcome was compared to the deflated market price through the use of a consumer price index presented in terms of 2002 dollars [81], and that outcome was assessed through the use of the economic input-output life cycle assessment (EIO-LCA) model—a strategy for the estimation of the materials and energy resources necessary for environmental emissions produced through economic activities [82]
This research has put forth a reverse supply chain optimization model that has been assembled to factor in the impact of supply chain operational and strategic actions on the environment

Summary

Introduction

The circular economy concept was developed as an alternative to the prevailing production paradigm of treating the environment as a waste reservoir, and was first raised four decades ago in a report submitted to the European Commission [1]. Frosch and Gallopoulos published an important work in the area of industrial ecology in 1989, inspiring a positive change from traditional open loop industrial activities systems to a model of industrial activities with a higher level of integration—an industrial ecosystem. This system has been described as one in which “the consumption of energy and material is optimized, waste generation is minimized and the effluents of one process ) serve as the raw material for another process” [2] This could slowly replace the economic logic of production by being more efficient through reusing, recycling, and remanufacturing, leading to economic growth. In Paris, the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) [4], reached a new global agreement through which the agreed parties voiced their commitment to achieving the goal of generating zero net GHG emissions by the latter part of the 21st century

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