Greening the supply chain: from breweries and resorts to hospitals and manufacturers, businesses are paying attention to where their supplies come from and the life cycles of their products.

• Author: Marshall, Lisa
• Position: PLANET-PROFIT REPORT

Ever wonder how they could make the little aluminum tab on your beer can in a way that uses less energy and emits less pollution? [paragraph] Probably not. But Leland Lorentzen thinks about it every day. [paragraph] "Every time we have a meeting with a customer about where they want to be in the future, sustainability is always part of the conversation," says Lorentzen, CEO of Fort Lupton-based Golden Aluminum, which uses recycled cans, and an energy-efficient mill, to make aluminum sheeting for food and beverage packaging. [paragraph] In recent years the mill has, among other things, upgraded to motion-control lighting systems, less-polluting furnaces and begun to recycle its wooden pallets for use in landscaping.

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"There is a drive from the top--from the Wal-Marts of the world--for their suppliers to come up with more sustainable options," Lorentzen says. "Here we are at the beginning of the supply chain, and lots of things are happening. It's really exciting."

Lorentzen is not alone. As large retailers and service providers have begun to move beyond in-house greening initiatives (like installing recycling bins and solar panels) and scrutinize their entire supply chain, everyone from raw-material suppliers to manufacturers to warehouse companies have been rising to the challenge.

The trend was fueled in part by a 2008 Carnegie Mellon University study that found most large companies overlook 75 percent of their greenhouse gas emissions--by failing to compute the resources used by their suppliers.

In 2009, Wal-Mart raised the bar with the unveiling of its Sustainable Product Index program, which promises to track the life-cycle of every product it sells and--within five years--create a label to alert consumers about how items rank. The company started by surveying more than 100,000 suppliers around the world about things like energy use, carbon emissions and waste. In October, it broadened and accelerated the agricultural piece of the program, vowing to double the amount of local produce it sells (to 9 percent by 2015) and begin asking its farmers for specifics about water, fertilizer and chemical use.

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"Customers want products that are more efficient, last longer and perform better, and increasingly they also want information about the entire life cycle of a product so they can feel good about buying it," said Wal-Mart president and CEO Mike Duke, in a prepared statement. At the company's Sustainability Milestone Meeting in October...