Developing your procurement sustainability strategy
What is a sustainable procurement strategy?
A sustainable procurement strategy considers environmental and social factors as well as economic. When thinking about sustainable procurement, it can be daunting at first, which is why a strategy is needed to prioritise certain issues and put them into a manageable perspective. Sustainable procurement helps your organisation to:
- Improve risk management by screening suppliers
- Helps with environmental regulations such as a reduction in carbon emissions
- Helps the development of the local business community and creates a robust and secure supply chain for the future
Sustainable procurement strategy stages
When starting to think about developing your procurement strategy, there are some common steps that you can follow to make it go smoothly.
- Review your supply chains:
Gather information by sending out questionnaires and using information from existing audits. Ask for details of manufacturing units and subcontractors. This may be timely, but it’s essential to build up an accurate picture. Don’t forget, that non-strategic suppliers can also cause the greatest damage to an organisation’s reputation too. - Identify problem areas:
Analyse and identity potential problematic supply routes, such as specific countries, human rights abuse, or production processes. By identifying high-risk countries in your supply chain, you can concentrate your efforts in these areas. Focus first on suppliers in areas which are known to have a record of abuse and your strategic suppliers. - Consult others:
Consultation with local and international experts may also be helpful at this stage, as well as with other organisations that have helped companies to implement solutions. - Construct policy and strategy:
Once potential problems have been identified, you can then construct your policy and strategy by identifying which issues your organisation can take responsibility for and which issues you want to prioritise.
Sustainable procurement strategy hints and tips
Implementing any new strategy, not just a sustainable one, can be confusing and often, it can be difficult to know where to start. It also proves tricky to get everyone in the organisation on board with the change. Here are some hints and tips that you should keep in mind that will help you develop a sustainable procurement strategy.
- Explore your organisations external environment
- Establish sustainability expectations by creating a code of conduct
- Map and segment your supply chains
- Determine roles and responsibilities within the organisation
- Make it easy for staff to adapt and try not to use a different measuring system. Make it a seamless integration so the organisation runs as usual
- Make the organisation’s members aware of the importance of having a sustainable procurement strategy
- Train and guide internal and external members of the organisation and supply chain
- Develop links with other organisations and peer groups to learn from their experiences
- Develop a standard approach to measuring strategic outcomes
Sustainable procurement challenges
When implementing change, there will always be some challenges and not just limited to people’s resistance to change. Take a look below and consider some of the challenges when adopting a sustainable procurement strategy.
- There is a need for a high degree of collaboration and engagement among members of the supply chain
- Lack of understanding about sustainability across the supply chain
- Lack of accountability if steering governance is not in place
- Difficulties in digesting lots of sustainability information
- Difficulties in setting the measurement tool or KPIs (Key Performance Indictors)
ESG in procurement
The following factors are associated with ESG in procurement and supply and need to be incorporated to ensure ESG is embedded into the future of procurement.
Click on each number to find out more.
How to apply sustainable procurement
We share some hints and tips about applying sustainable procurement within your organisation.
Find out more about How To Apply Sustainable Procurement
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