The Importance of Collaboration in Creating Climate-Resilient Supply Chains

Abstract: Global resource supply chains connect dissimilar locations and economies by transporting goods like fish, rice, and minerals from producers to consumers worldwide. Although these supply chains are more sensitive to the effects of a changing environment, the study of the production phase pays little attention to them. Too frequently, businesses discover if and how their supply chains can resist and recover from climate shocks via experience, with little knowledge of how to proactively design supply networks that are climate resilient. Hence, using a network-based modeling technique, this study evaluates supply chain resilience, specifically the interruption encountered during severe climate-related events. This study examines supply chain examples from the food processing, agricultural, and mining sectors of America's resource industries, all of which have recently been impacted by climate shocks. For each industry, we create four supply chain indices to measure how well simple and complicated supply chains perform based on evenness, resilience, continuity, and climate resilience. It demonstrates that complex supply networks with many nodes and linkages are more robust to interruption than natural systems. Importantly, if climatic shocks increase in frequency, all chains, regardless of their complexity, will lose resilience. This emphasizes how crucial it is to take into account the larger economic advantages of varied chains, which may reduce risk and enhance the design after a disruption. It also highlights the value of a systems approach to risk management in supply chains, especially when taking into account adaptation options for dealing with direct and indirect consequences on the chain as well as the global problem of lowering greenhouse gas emissions.

Keywords: Gas Emission, Precipitation, Climate Resilience, Supply chain, network-based