Policies to exclude non-sustainable suppliers needed

25 May 2012

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25 May 2012 | Kamalpreet Badasha

A survey of 250 senior executives in eight countries found only 15 per cent have procurement policies that exclude non-sustainable suppliers.

A further 14 per cent have plans to introduce such policies, according to research by Accenture.

The survey quizzed vice presidents or equivalent with decision-making input from companies in the UK, US, Japan, Germany, France, China, Brazil and India in March this year.

The report, Long-term growth, short-term differentiation and profits from sustainable products and services, said in terms of the supply chains, 16 per cent had checked sustainability credentials and a further 16 per cent planned to do so.

It went on to reveal that 49 per cent said margins are lower on sustainable products and services.

It recommended investment in supply chains and procurement functions is to enable firms to be both commercially viable and to produce sustainable products and services. It also said companies need to review the return on investment in their supply chains to identify areas where savings can be made.

The report also added that as businesses improve supply chain sustainability credentials, it is important that core operations remain flexible and are able adapt to market developments.

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