Four ways to create a sustainable procurement process

on Tuesday, June 24, 2014

Four ways to create a sustainable procurement process

The rise of multi-tier, flexible distribution processes has made it easy for enterprises to grow lax when it comes to exercising sustainable practices.

Keeping an eye on 1,000 suppliers or more certainly isn't easy, but there are four ways organizations can develop a more efficient, eco-friendly procurement process.

1. Hit the breaks, evaluate 

Instead of panicking over possible negative public perception and frantically opening communications with multiple vendors at once, take a step back and figure out how to make strategic sourcing as manageable as possible. CRedit360 Business Development Director Matt Scott noted that connecting with disparate supplier contingencies one at a time is a solid first step. 

In this respect, it's in an enterprise's best interest to start at the finish line and trace its way back to the original equipment manufacturers and raw material producers. Scrutinizing companies operating at the beginning of the distribution chain will help businesses answer the following questions:

  • Do they operate in countries notorious for corruption?
  • What are the primary energy resources they use?
  • Do their labor practices reflect government standards? 

2. Proactively engage with supplier relationship management 

In addition to observing from the outside, Scott acknowledged the importance of speaking with all organizations contributing to the procurement process. Not only should sourcing specialists ask about environmental policies, but also about how OEMs and other business plan on implementing eco-friendly practices. Don't be afraid to push some buttons. 

3. Spawn a culture that favors sustainability 

The mantra "lead by example" works well here. While an enterprise participates in the corporate arena, focusing on environmental best practices and positive labor operations will encourage those around it to take the same measures. 

Companies want to establish relationships with profitable, socially cognizant entities because it helps them develop a positive public image. Gaining consumer favor is difficult in the current landscape, especially when contending with global competitors. 

4. Connect with nonprofits 

Numerous societal issues have incited the creation of multiple charities and nonprofit organizations dedicated to improving worker conditions and discouraging negative corporate environmental impact.

GreenBiz recently spoke with Ursula Wynhoven, general counsel and chief of governance and social sustainability at the U.N. Global Compact, who noted that connecting with such entities will help foster sustainable strategic sourcing. 

By following the aforementioned steps, enterprises will be well on their way to fostering best practices. A part of remaining competitive involves being aware of the consequences private entities have on global sourcing. The key is to make those repercussions positive. 

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