Sustainable Procurement: Recyclable Goods to Responsible Supplier Base

“Sustainable procurement allows organizations to meet their needs for goods, services, construction works and utilities in a way that achieves value for money on a whole-life basis in terms of generating benefits not only to the organization, but also to society and the economy, while remaining within the carrying capacity of the environment.” Source

If you are a sustainable procurement enthusiast, you know how the concept of sustainable procurement has evolved over the years. Earlier, the idea was just to buy recyclable products. But now, sustainable procurement is also having responsible suppliers adhering to prevalent labour laws and government safety and health regulations which are a part of any responsible organization’s ethics policies and risk-mitigation programs.

The 2017 EcoVadis/HEC Sustainable Procurement Barometer survey of U.S. and Western European companies tells us that the lack of internal resources poses to be one of the biggest obstacles in managing sustainable procurement programs. Earlier, the report tells us, management didn’t put in enough to induct the practice. But now, we can see although CEOs have welcome it but haven’t armed their procurement leaders with human resources or tools needed for the maintenance of the same. And the reason is the cost of implementing such programs. Well, the cost of sustainable procurement isn’t illegitimate. We can’t defy it. But that’s the whole game wherein companies that have realized the value of investing in sustainable procurement, have benefited from increase revenue by targeting sales to the conscious millennials.

So the point of content is if CEOs already realize the benefits of sustainable procurement which is why they have half-welcomed it then should Procurement take a backseat and relax? Well, certainly not. In fact-

1. Procurement should take this up as a challenge and acquire more and more information on the effect sustainable procurement on costs and revenues, so that they can go back to their CEOs with their datasheet.
2. Strategically, peer bench-marking is another clever way to solicit the interest of the CEOs. Cite companies with longstanding commitment in sustainable procurement and how their procurement leaders are able to extract exacting values for their businesses from their suppliers.
3. Procurement can also establish the value of sustainable procurement both internally and externally by way of educating its resources, improving its supplier selection procedure and quarterly performance reviews of the vendors.
4. There is no one way of going about implementing a program. For instance if existing procurement leadership is failing to show results because of time constraints or lack of adequate information, then they can put in a requisition (read: a perfect procurement professional’s sales-pitch) for additional resource that can help with cost reduction, increase in revenue or overall service improvement.

This way, both CEOs and procurement leaders meet half way in ensuring they have resources to manage and thoroughly implement  sustainable procurement practices for social and financial interests.

Related Read:

1. Blog – How can Marketing and Procurement work better together?
2. Blog – 5 Ways World-Class Procurement Organizations Get Quick Results
3. Blog – Top 10 Winning Skills for Procurement Professionals
4. Start Your Cognitive Procurement Journey with Zycus
5. Webinar – All In On Analytics: Running Your Procurement Organization by the Dashboard Lights
6. White Paper – Procurement Analytics: Empowering the Future of Procurement