Procurement can pursue the ESG agenda more effectively by treating diverse suppliers with the same importance as strategic ones, an event was told.
The CIPS Sustainable Procurement Summit heard that diverse suppliers and social enterprises must be embedded into RFPs and tendering processes.
Amy Brogan, UK procurement and supply chain director at facilities management company CBRE, said: “We’ve segmented the supply chain pretty significantly, and we now put diversity alongside our strategic suppliers, so they get the same support from our category managers that any of our strategic suppliers do, where we have very significant benefit.
“And that’s because we understand the value of supporting them through the journey and having access to those category experts, as well, who can show them what the good practice looks like, who can connect them with non-competing similar organisations so they can learn from each other as well.”
During a panel discussion buyers were advised to start small and build momentum in order to continue improving. First steps included making sustainability issues a part of training, introducing tier one suppliers to social enterprises, and educating customers.
“It’s all about collaboration. When you’re writing tender submissions, I would make sure that you’re offering an opportunity for an alternative,” Brogan advised. “Sometimes specifications can be so tight that it stops us offering alternatives that actually could be better. Different options could offer a unique and innovative solution for you. So consider the whole impact, the spec, and offer secondary options as well.”
Social enterprises were defined as organisations which invest 50% of their profits into a defined social mission.
Speaking of introducing diversity, Brogan said: “Procurement can’t do it alone, it has to be part of the wider business. So connect diversity to your values, your cultural strategy, to make sure it's not a tickbox exercise. Think about it in terms of categories.”
Janette Evans-Turner, head of sourcing and procurement at Zurich, added: “It’s about working as a group. We’ve got a pilot at the moment where a group of us are working to extend what we’re doing here in the UK across EMEA so it’s about building those markets continuously. The more we can spend, the more we can develop that marketplace.
“You need to build awareness. It’s about going back to your teams and inspiring them, getting them really energised to want to do this too. You need to motivate those people, get them excited.”
Social enterprises were comparable on quality and cost, delegates were told.
Brogan discussed the importance of getting started without waiting for data. “The data journey was a labour of love, I’m not going to lie. It was really tricky, and it took us a full year to get really quality data.
“From a data perspective, work with your suppliers to really understand, patiently educate them because there will be a lot of them that are already diverse that don’t know about it. Use all of the advocacy groups who work with all of the different diverse suppliers to make sure you get a baseline for where you’re currently spending, and identify new ones, and don’t wait for quality data.
“If we wait for perfect data we will be here having not made an impact a year later. So start focusing on the categories where you think you can introduce a new diverse supplier and work with them.”
Andy Daly, head of partnerships at Social Enterprise UK, focused on the importance of starting to build social enterprises into the supply chain. “Mapping your current supply chain to find out where you already have diverse enterprises in your chain. That’s the best way to sort of slide in, and then plan your strategy. You will have social enterprises in your supply chain.”
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