Sustainable procurement saves millions at Diageo

7 September 2012

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7 September 2012 | Anna Reynolds

The global supply and procurement department of the global drinks business has helped the company save millions through environmental initiatives.

In its 2012 Sustainability and Responsibility report out this week, the company behind the Smirnoff, Baileys, Guinness brands revealed its environmental strategy resulted in millions of savings. Water efficiency, for example, improved by 7.2 per cent and the company reduced carbon emissions by almost 10 per cent compared with the year before.

In one instance, more efficient use of resources is expected to result in annual savings of £1.4 million from a two-year carbon reduction project at a distillery in Scotland.

David Gosnell, president of global supply and procurement, said: “We aim to achieve unrivalled performance in our supply chains through developing mutually rewarding relationships with suppliers who deliver excellent service, consistently achieve our quality standards, manage business risks, drive out cost and innovate to increase value.

"Equally we expect and encourage our suppliers to commit to achieve high standards and consistent progress in business ethics and sustainability”.

Strict regulations are in place across Diageo’s network of suppliers across 100 countries. Social, ethical and environmental standards are clearly outlined in contracts and where possible it uses local suppliers and offers training schemes to aid development.

The company says its engagement with consumers, customers and suppliers, is key to its competitive advantage and an important driver of growth because its improved reputation is helping it win work. It believes is this that helped it secure the acquisition of the Meta Abo brewery from the Ethiopian Government.

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