Impact of climate change in food manufacturing industry

Discuss about the Climate Change Economy Adoptability and Eeffectiveness.

The purpose of this study is to emphasize on the carbon tax policy and emission reduction fund. The Australian government has implemented efficient strategies in order to mitigate the issues caused by climate change. The companies need o comply with the legislative frameworks in order to conduct sustainable business (Beck et al. 2015). The practice for reducing greenhouse gas emission depends on the type of industry. In this study, food-manufacturing industry has been selected in order to evaluate and compare these two policies. This study has evaluated the risk and opportunity for the selected industry in a carbon-constrained world. In order to mitigate the climate related risk factors, companies are implementing efficient strategies. This study emphasizes on the adaptation strategies of food manufacturing industry in order to conduct environmentally sustainable business.    

Food manufacturing industry is one of the key sensitive industries in which the impact of climate change is wide. For example, too much rainfall, flooding can have a diverse impact on food manufacturing industry ((Fahimnia et al. 2015). However, nowadays, food-manufacturing companies have implemented efficient technologies in order to mitigate the climate issues and boost the production. Despite of the technological innovation, food-manufacturing industry is facing huge issues due to rapidly changing climate. Following are the significant impact of climate change in food manufacturing company (Liu et al. 2015).

Quantity and quality: A massive change in climate can affect quality and quantity production of food manufacturing industry. When it comes to the food quality, a sudden climate change tends the farmers to apply fertilizers in order to boost production (Murray and Rivers 2015). However, applying such chemical agents affects quality of the seeds. Moreover, applying fertilizers has diverse impact on the food’s characteristics (Zou et al. 2015). Apart from that, it has significant impact on quantity as well. During the climate change, production of food products may reduce. Therefore, it would increase price of raw materials for the food manufacturing companies. Moreover, food manufacturers need to store the raw materials in order to mitigate supply chain issues (Suzuki and Iguchi 2016). However, storing the raw materials may affect the product quality negatively. Therefore, it can be said that quality and quantity of products can be harmed by the changing climate.        

Supply chain: Climate change has wide impact on the supply chain process of food manufacturing company. The suppliers may increase product price during unfavorable climate (Gevrek and Uyduranoglu 2015). Therefore, it would increase the cost of raw materials and cost of business as well. Therefore, it can be said that change in climate may harm the supply chain process of a food manufacturing company.  

Discussing and comparing carbon tax and direct action plan

Raw materials: In order to conduct sustainable business, a food manufacturing company should maintain the flow of raw materials in an appropriate manner. However, the changing climate and increasing carbon dioxide emission prevents raw material production. As a result, price of raw material is increasing remarkably (Parry et al. 2015). In such environment, it is difficult for the food manufacturing companies to increase sustainability and profitability as well.

The Australian government has implemented the carbon tax policy in order to mitigate the greenhouse gas emission. The purpose of this policy was to set up emission reduction fund. According to this policy, the companies those are emitting over 25,000 tomes greenhouse gas are subject to this scheme (James and Harrison 2016). In order to comply with this policy, the companies need to obtain emission permit from the government. The aim of the policy was to reduce the greenhouse emission by 5% by 2020 and below 80% by 2050. According to this policy, the largest emitters were bound to invest for sustainable energy. This policy encourages the companies to reduce manufacturing products with high carbon intensive (de Alegría et al. 2016). Therefore, the companies need to focus on the low carbon intensive products in order to reduce organizational cost and profitability. Apart from that, it influences the households to reduce use of products with high carbon intensive.

The carbon tax policy has been implemented in order to reduce the negative impact of climate among business organizations. Organizations those are emitting greenhouse gases should reduce emission in order to conduct sustainable business (Hornafius and Hornafius 2015). The increasing emission of greenhouse gas is a threat to the climate. Therefore, government of Australia has implemented this policy in order to increase investment to the sustainable environment. The rationale behind this policy development was to encourage the companies to participate in environmental sustainability.

Emissions Reduction Fund is a scheme introduced by the government in order to encourage the organizations and individuals to adopt good practices in order to improve environment quality. On the other hand, the carbon tax policy was not applicable for the households (Oshiro and Masui 2015). Therefore, it can be said that the government has implemented some major amendments while introducing this policy. Promoting awareness about greenhouse emission and mitigation of the same, the government has incorporated the individuals into the policy (Wu et al. 2015). According to this policy, organizations may start an environmental program through which emission can be reduced. Thereafter, the company should claim to the Australian carbon credit units (ACCUs) in order to sell the emission reduction quantity. On the other hand, the carbon tax policy was not having such facility, which may influence the organizations to participate in carbon emission reduction. Therefore, it can be said that the emission reduction fund has improved by the government in order to achieve same goal in an effective manner (Gallego-Álvarez, Segura and Martínez-Ferrero 2015). In this context, the clean energy regulator is responsible to identify the companies or individual those are not complying with the legislative framework of government. The overall discussion on these two policies has been developed in order to reduce carbon emission. The focus of these policies is on sustainable environment through monitoring practice of organizaiotons those are large carbon emitters (Sun et al. 2016). Through the discussion, it has been identified that the emission reduction fund policy is an improved version of the carbon tax policy 2012.                 

Risk and opportunities of food manufacturing industry

In a carbon-constrained world, food-manufacturing companies may face certain risk while conducting business. The term carbon constrained world refers the country where carbon emission is not has been considered as a major factor. In such environmental scenario, government may impose legislations in order to mitigate carbon emission (Breyer, Koskinen and Blechinger 2015). In food manufacturing industry, companies need to dispose the waste materials either in solid state or in liquid state. Therefore, the companies need to process the waste before disposing in order to comply with the environmental guidelines. Following are the risk and opportunities of food manufacturing companies in a carbon-constrained environment.

In order to conduct sustainable business, an organization should comply with the governmental legislations. Therefore, it is highly important to improve the internal practices in accordance with the governmental laws and policies. The government can impose a legislation, which may increase manufacturing cost for a food manufacturing company. For example, the government may encourage the companies to improve technological aspects in order to reduce contamination from the wastes (Beck et al. 2015). In such business environment, the company has to introduce innovation within the organization in order to conduct sustainable business. However, implementing technological change has wide impact on the business model. For instance, the current employees may or may not accept the change implemented. Here, the company may face high employee attrition due to low acceptance rate among the employees (Fahimnia et al. 2015). Moreover, implementing innovative technologies may increase organizational cost. However, this investment does not have any short-term returns. Therefore, it is difficult for the small-scale food manufacturing companies to deal with such change in environment. Apart from that, in a carbon-constrained world, it is difficult for a food manufacturing company to mitigate supply chain related issues. The decreasing quality of environment may affect the quality of raw materials and price as well. The increase price and decreasing quality of raw material has direct impact on product price and food quality (Liu et al. 2015). Moreover, water scarcity is another risk factor, which can arise due to low quality environment. Therefore, it can be said that a food manufacturing company should comply and take part in environment improvement scheme in order to conduct sustainable business. Taking part in emission reduction would increase organizational cost, which may affect profitability negatively (Murray and Rivers 2015). On the other hand, high carbon emission has negative impact on business process of a food manufacturing company.

Participating in reducing carbon emission helps to improve organizational brand image. The companies in food manufacturing industry may promote sustainable practices in order to improve organizational brand image. In a carbon-constrained world, a food manufacturing organization can promote corporate social responsibilities in order to improve consumers’ perception regarding the brand (Zou et al. 2015). Moreover, the companies in this industry will be able to influence the stakeholders for long-term impact on business. The companies would be able to publish the activities for reducing carbon emission through their sustainable report in order to influence the stakeholders in an effective manner. The companies will be able to publish the social activities in order to grab attention of the stakeholders (Suzuki and Iguchi 2016). Moreover, it would help the companies to ensure high quality food manufacturing. In this manner, the companies would be able to create strong brand image through which long-term benefits can be gained.

The climate change adaption-strategy for food manufacturing companies would be resource management and waste reduction. In order to conduct sustainable business, the organizations are focusing on low waste of resources. It helps the companies to respond to the probable issues caused by carbon emission (Gevrek and Uyduranoglu 2015). Moreover, improving organizational practices would be the most important factor, which helps the food manufacturing industries to overcome potential challenges. Apart from that, the companies have implemented wastewater and solid waste disposal technologies in order to decontaminate the wastes. It helps the companies to take part in environmental improvement schemes (Parry et al. 2015). Therefore, it can be said that a food manufacturing company can increase social awareness about good environmental practice.

In order to deal with the raw material quantity, the organizations have adopted efficient strategies. The companies have implemented lean management strategy in order to reduce waste and increase profitability. In order to conduct sustainable business, the companies have established strong communication with the suppliers in order to ensure quality of the raw materials. In an environmentally friendly business, it is highly important to involve the employees in order to improve the product quality (de Alegría et al. 2016). Therefore, “total quality management” has been selected by the organizations as management tool. Through this strategy, it is possible to involve the internal stakeholders in quality improvement plan. Apart from that, the food manufacturing organizations have paid close attention to the improvement of waste quality. Moreover, value chain approach has been considered an adaption strategy (Oshiro and Masui 2015). Through this strategy, the organizations are mitigating the environmental related issues. The major aim of the companies is to reduce carbon footprint in order to maintain business sustainability.

Conclusion

While concluding, it can be said that the government has improved the carbon tax policy and implemented the emission reduction fund in order to improve environment quality. According to the policies implemented by the government, an organization should improve the environment quality by reducing carbon emission. The study shows that food-manufacturing industry has adopted wastewater and solid waste purification in order to improve quality of the environment. Moreover, the companies are considering raw materials quality and quantity as the major factor. There are different challenges that have been identified in this study. The companies are facing huge challenges due to high demand of raw materials and therefore, it is difficult for the companies to increase profitability.

Reference list

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