Cost allocation and incentive mechanisms for environmental, climate protection and resource conservation along global supply chains - Recommendations for selected incentive mechanisms

This report summarizes the findings of the research project "Cost allocation and incentive mechanisms for environmental, climate protection and resource conservation along global supply chains" and investigates four selected supply chain management instruments which have a high potential to increase incentives for environmental protection in global supply chains:

• price premiums,
• pay-per-performance contracts,
• collaborative financing of supplier investments in environmental upgrades, and
• offtake agreements.

Each instrument is discussed regarding its contribution to effective cost-benefit between buying and supplying companies, design options, necessary framework conditions and the roles of various stakeholders to mainstreaming the instrument.