Five steps for integrating technology with sustainable procurement

GlaxoSmithKline (GSK) has shared its five-step sustainable procurement plan, which aims to achieve net zero carbon emissions and net positive nature impact by 2030.

Tom Newbigging, senior sustainability manager at GSK, speaking at World Sustainable Procurement Day, explained how the company had used technology to improve sustainability.

1. Gathering data

In order to manage you must first measure, Newbigging said.

He explained GSK had moved away from desktop-based scope three assessments and high-level PowerPoint presentations. Instead, the company was focused on granular, primary, GSK-focused data.

Achieving this level of specificity required the company to have conversations with suppliers to discover what carbon emissions were coming from which specific manufacturer.

Newbigging explained this granular level of data was important because "that’s what allows you to really drive improvement".

2. Specify engagement strategy

Newbigging said there were likely to be differences in supplier maturity levels. Some suppliers were likely to be further along their sustainability journey, perhaps even than GSK itself, while some were just starting.

He explained partnerships should enable GSK to provide experience to those who needed it. More experienced suppliers would allow GSK to ask what problems they could address within their joint supply chain.

3. Understand opportunities

In order to assess what is should be done, Newbigging explained that GSK had needed to understand the issues suppliers were facing. “What are the challenges that are stopping suppliers improving as quickly as we’d like? Is it access to capital? Is it not seen as a priority internally? Is it local infrastructure?”

He emphasised discovering these issues was not a simple matter of submitting surveys to suppliers. Firms should ensure suppliers understood what the value proposition was for data requests and what specifically the data would be used for.

4. Implement opportunities

Once challenges had been identified, the next step was putting into place the systems required to solve them.

Newbigging mentioned GSK’s Energise programme, a partnership between Schneider Electric, GSK, and nine other pharmaceutical companies. This had allowed them to move towards renewable energy far faster.

As part of the programme, companies attended a 10-week capacity building workshop series.

Newbigging said for some suppliers there hadn’t been a commercially viable route to renewable energy, but Energise had allowed suppliers to form cohorts interested in power purchasing agreements.

Schneider aggregated demand, led a tendering process, and identified viable providers of renewable energy.

5. Use data to set specific targets

Once systems had been put in place, Newbigging said companies should set a specific carbon reduction target, with sustainability KPIs just as important as quality and price.

He gave examples of GSK’s own net zero carbon emissions and net positive nature impact (water wastage and biodiversity) by 2030 targets. 

Newbigging said in order to reach these targets they would have to partner closely with suppliers. “We are at a point now where we have set targets across each of our procurement categories, to get first of all our key suppliers onto the Manufacture 2030 system.

“And then secondly, really to use it as a business-as-usual tools. In the same way our procurement teams would talk about price, they talk about supply, they talk about quality.”

Manufacture 2030 is a global digital collaboration platform, which brings retailers, brands and manufacturing suppliers together to reduce carbon footprints.

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