Office furniture maker Herman Miller Inc. may be one of the few manufacturers that can truly claim an enterprisewide legacy of environmental stewardship. Unlike companies that only in recent years have begun touting waste-saving initiatives as "green" projects, the $1.6 billion manufacturer traces its history of environmental awareness back to the 1950s when founder D.J. DePree opened work areas to natural light by locating employees no more than 75 feet from a window.

In 1997, DePree's vision led the company to implement a product-design concept that requires its suppliers to help incorporate more environmentally friendly materials into the finished product. The company says it's difficult to measure whether the program has yielded significant investment returns from the purchase of higher-cost materials, but President and CEO Brian Walker says there's definitely a business case to be made for greener supply chains.

"Looking at the molecular level of chemicals in products, there are cases -- no doubt about it -- where we have to pay increased costs to get compounds and materials that are more environmentally sensitive," Walker says. "Now, we're very careful to say if we do that we have to be able to make those investments back in our products in either A, our customers value it enough to pay for it or B, find other savings to pay for those increased costs."

Herman Miller's commitment to extending green manufacturing practices from its facilities through the entire supply chain was an undertaking with several challenges that may be preventing other manufacturers from following suit. Green initiatives are largely taking place within manufacturers' own facilities -- oftentimes as energy-reduction projects in disguise, says Larry Lapide, research affiliate at the MIT Center for Transportation & Logistics. "In my view those companies that say they are being more green have really only done so by being energy efficient to drive down costs, not for altruistic reasons," he says.

The Cost of Being 'Green'

The reason why more manufacturers haven't extended environmental initiatives throughout their supply chains is likely cost. For instance, consumer-electronics manufacturers pay an estimated $3 billion annually to meet European Union regulations that restrict the use of certain substances in their products, according to a June 2008 study published by the Consumer Electronics Association. When Wal-Mart announced its green supply chain mandate in July, the company said it was premature to estimate the cost to suppliers, The Wall Street Journal reported. But the paper noted that clothing manufacturer Patagonia Inc. said its well-established supply chain sustainability efforts had been costly.

That may account for why the number of manufacturers adopting green supply chain programs appears to be few and far between. Only 10% of companies have implemented successful green supply chain initiatives, according to a survey of 245 supply chain executives published in February by consulting firm Accenture.

"I would say that if you look at all the data and research, we're in early adopters stage here for the most part," says Adrian Gonzalez, director of Logistics Viewpoints at ARC Advisory Group. Part of the problem is getting multiple suppliers, some of which are located thousands of miles away in different countries, to get on board with sustainability initiatives, Gonzalez says.

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