A water footprint management framework for supply chains under green market behaviour

Freshwater sustainability has been emerging as a critical corporate social responsibility issue for leading businesses worldwide. An increasing number of companies disclose and evaluate their water footprint, embracing an end-to-end supply chain perspective. In this work, we first propose a strategic system dynamics model for capturing the long-term impact of various water management policies on consumptive water footprint and supply chain profitability under diverse scenarios of consumers' demand patterns depending on blue water-related efficiency (i.e. green market behaviours). We apply the proposed simulation model on a specific wine supply chain and demonstrate that, under specific green market behaviour conditions, technological interventions in agriculture (e.g. drip irrigation) are more environmentally and economically sustainable compared to industrial water recycling and reuse, while the combined application of both policies is even more effective. Additionally, the impact of water efficient policies on supply chain financial performance is even more potent under increased consumers' environmental sensitivity. Based on the managerial insights obtained from our analysis, as well as current corporate drivers and goals, we finally propose a supporting methodological framework for the ex-ante evaluation of eco-efficient supply chain water management policies, considering the impact of the green market behaviour on water-related and economic sustainability. (C) 2018 Elsevier Ltd. All rights reserved.