Nationwide’s procurement programme aims for an ethical and diverse supply chain that still delivers on customer needs ©Getty Images
Nationwide’s procurement programme aims for an ethical and diverse supply chain that still delivers on customer needs ©Getty Images

Using supplier relationship management to lead on ESG

posted by Alexander Love
9 December 2021

Nationwide Building Society united its staff, partners and suppliers in an effort to meet its sustainability goals

A global pandemic may not seem the ideal time to launch a procurement programme focused on sustainability and social issues, yet many organisations found that Covid-19 only highlighted the need for responsible activities. This was the case for Nationwide Building Society in 2020.

Early last year, when much of the world was oblivious to the disruption to come from the Coronavirus, Nationwide began to develop its Procurement for Mutual Good programme. The team first assessed which environmental and social issues were most important to the company and wider industry regarding sustainability in procurement.

It then set out to develop an in-house pilot programme that would focus on working with ethical suppliers, in line with Nationwide’s existing society-wide Mutual Good commitments.

The aims had multiple threads, which included slashing emissions to become carbon neutral by 2030 through the use of renewable energy; removing single-use plastics from operations by 2025; and offering staff training in modern slavery issues. Nationwide formed partnerships with sustainability specialists EcoVadis and Carbon Intelligence to maximise its £1.4bn spend on procurement.

The building society also continued its active involvement in Social Enterprise UK’s Buy Social Corporate Challenge to increase these relationships. Nationwide signed up to the real Living Wage with 80 suppliers, while an additional objective was to ensure faster payments for micro, small and medium-sized enterprises.

Environmental goals

With people regularly working from home and hybrid models of flexible working becoming the norm, Nationwide found it difficult to monitor factors such employees’ energy use and recycling rates. Given that these are integral to the building society’s sustainable procurement programme, the team had to adapt it to the new environment to achieve its targets. 

Colleagues working remotely were asked to make individual green pledges and to track their own progress using weekly surveys. Led by Nationwide’s procurement team, the initiative is now being introduced to other divisions of the business.

“Moving from having around 13,000 colleagues working from home to navigating a hybrid working model, we’re still understanding what the future looks like in terms of energy use, emissions and waste,” says Zara Williams, responsible business manager at Nationwide. 

“Sustainability is firmly part of our internal workstream on the Future of Work and, just a few months ago, we launched an environmental sustainability support guide for our colleagues with tips and resources on how to be greener at work, at home, when travelling and in life.”

 To cut plastic waste, the society worked with cleaning partners to use refillable products, eliminating the need for 150,000 single-use plastic bottles a year, as well as using recyclable uniforms and reusable face masks.

One of the biggest challenges was selecting a centralised platform to gather all the information on the environmental performance of both the organisation and associated third parties.

To achieve this, Nationwide implemented an EcoVadis platform to monitor and score its sustainability and ethics performance across the supply chain. This means that, if a particular area is under-delivering, it can be identified and action taken.

Ethical considerations

One of the key aims of the programme was to tackle modern slavery in the supply chain. To realise this, Nationwide linked up with Unseen, a UK-based anti-slavery charity, which helped train around 90 staff in advanced methods of risk assessing suppliers, recognising the warning signs that indicate slavery risks and understanding the importance of this to the organisation.

Other measures included introducing a more extensive due-diligence questionnaire. Following the training, staff reported feeling more engaged with the issue and said their understanding of modern slavery had improved.

“We found partnering Unseen invaluable here,” explains Williams. “Having Unseen’s experts in addressing modern slavery bring their experience and insight from the frontline was really powerful in engaging the team. Also it is important to be really clear in what you are asking of colleagues, so they understand the role they play and why it is important. And not just running one workshop but keeping the engagement going with refresher training and regular communications.”

There is no question that the global pandemic has changed the working environment for many organisations, both positively and negatively. On the positive side, the disruption caused by Covid-19 has demonstrated just how quickly people can adapt and how processes can be altered to meet changing requirements without putting business at risk.

Furthermore, training sessions and events are no longer limited by how many people can fit in one room. With video calls now part of everyday life, this opens up further opportunities for engagement and to reinforce core messages. 

“We’re no longer restricted by locations or meeting room sizes. Because of this, we had a record number of third parties join our Annual Partner Event last year, where our chief strategy and sustainability officer and our chief procurement officer spoke about our approach to responsible business,” says Hannah Coopey, senior operations manager at Nationwide.

“The lockdowns also showed us how quickly we can change in the face of a crisis, and ensured we could continue to deliver Procurement for Mutual Good despite the global pandemic. So far, our suppliers have been really engaged in our programme and are keen to work with us as we try to solve some of the most pressing environmental and ethical issues of our time.”

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