Rather than being the domain of one single part of a company's structure, efforts to make procurement programs greener and more responsible take a coalition of stakeholders. Combining organization-wide strategic priorities with the everyday work of transactional sourcing, these undertakings may require serious investments of time and resources. However, in an era defined by customers' autonomy and desire to buy from ethical companies, the focus can pay off.
The drive toward green sourcing, driven by internal and external visibility, has been seriously underway for a few years now. The practices involved have not reached every company, however, and businesses that are lagging need to consider the potential implications of diving in and changing their processes.
Defining the green sourcing alliance
Getting anything done within a corporate structure is a matter of generating consensus and group momentum. Business For Social Responsibility's Meghan Ryan, contributing to GreenBiz, recently pointed out a few of the finer points that go into the relationships behind green sourcing. Procurement departments and sustainability professionals are the main members of this partnership, with green programs being more concerned with speaking to sourcing teams than with overall leaders such as CEOS.
Ryan noted that the bond between the two departments - sustainability and procurement - often gets off to a poor start. Green officials will lament how hard it is to get their voices heard in the supply chain, while sourcing leaders will become unhappy with sustainability executives' knowledge of what procurement entails. However, once leaders overcome their trepidation, they can move forward together. Sustainability team members who make their suggestions and proposals match up with an updated and accurate picture of sourcing wants and needs can make a strategic impact.
Rather than standing for less efficient or weaker forms of procurement, sustainability experts represent the future of sourcing. Ryan explained the connection between the supply chain and green business can benefit from thinking about responsible operations as value-delivering and futuristic practices. She placed this connection in a strategic sourcing context: Supply chain leaders are becoming drivers of overall corporate direction, and they can benefit from getting sustainability teams' opinions on this transition.
What does it look like when companies commit to sustainability on a great scale? Reuters reported in late 2017 that car manufacturers are in the process of setting up supply lines for the minerals and other raw materials used in electric vehicles. These organizations, perhaps realizing that harmful practices would offset the positive image of eco-conscious electric cars, have announced en masse that their new sourcing practices will be sustainable.
The "Drive Sustainability" agreement links 10 of the largest automakers, and they hope to work together to identify the potential problems associated with acquiring the materials they'll need to mass-produce new generations of vehicles. The issues could encompass the potential for environmental damage, the possible exploitation of workers' rights and more general political considerations. Furthermore, the agreement goes beyond the electric-car field to encompass such common components as rubber and leather. Cleaning up the supply chain on an industrial scale would be a notable step forward.