Analyzing potential effects of implementing Green Supply Chain Management practices: A case study of the buyer-supplier relationship between Equinor ASA and Simon Møkster Shipping AS

Abstract

Green supply chain management is receiving a growing attention from both academia and practitioners, as a response to environmental concerns and an increasing synonymous between business operation and supply chain management. This concept is highly relevant for industriesthat extensively impact the environment. Where operators in the Norwegian petroleum industry is becoming aware of the environmental impact in their supply chain, especially within themarine fleet.This thesis will therefore focus on a central practice to implement the concept: cooperationwith suppliers for environmental objectives. The objectiveis to analyze how contract management may positively influence thispractice, withanemphasize on the contracts. A literature review was initiated to develop an understanding of the research field and key aspects, and to iteratively construct the research model. The study was empirically driven, where a case study research was conducted based on the buyer-supplier relationship between Equinor and Simon Møkster Shipping. Empirical data was collected and analyzed from a total of seven participants, divided between the case companies.Findings indicatedthat the standard contracting option: time-charter, resultsin a conflict of interest, especially with the increasing focus on energy efficiency. The supplier’slack of reasoning for collaborative efforts, appears to derive from an inefficient allocation of benefits. Time-charter contracts was therefore analyzed based on the applicability for energy efficiency, where empirical findings directedthe attention towards the strategic fit of performance-based contracts. A conceptual change corroborates with this interest, where collaborative efforts for greening appears to be strengthen, as it potentially aligns their objectivesand ties performance to an incentive structure. Enablers and operational barriers were further investigated,where the complex supply chain of petroleum was discovered as one ofthe key aspects. Hence,it would be demanding tochallengethe standard and easily managed time-charter contracts, but at the same time increasingly important in an industry highly vulnerable to environmental concerns. The practicein focus is perceived as an antecedent for further implementation of green supply chain management and would therefore be part of a proactive response to a topical demand.