Four key strategies for sustainable procurement include: a holistic approach; data integration; “paying it forward” by investing to benefit suppliers; and stakeholder engagement.
These strategies became apparent from the Sustainable Procurement Barometer, which was published earlier this year, by EcoVadis and Accenture.
The following is an excerpt from an article about their conclusions:
Holistic Approach -- Leaders in sustainable procurement – about 10% of the companies we surveyed – have incorporated sustainability into at least four of eight procurement processes, with a minimum of one process being digitally integrated. They’re broadening their focus away from the central concern of decarbonization, which is where many organizations begin their sustainability journey. For leading companies, sustainability isn’t an afterthought; it’s increasingly at the heart of procurement.
Data Integration -- They build robust procure-tech foundations that allow them to integrate a variety of datasets, gaining a contextual understanding of ESG
impacts across their organization. The most successful procurement teams invest in advanced tools to gain visibility and deepen ESG engagement, integrate the resulting KPIs broadly across P2P processes, align team skills and incentives to outputs and leverage technology and data analytics to showcase their success within the company.
Paying it Forward -- This philosophy involves investing in sustainability programs that benefit suppliers, with the realization that this commitment will improve both performance and data quality. Across all the companies we surveyed – not just leaders – the focus on cost reduction in supply-chain sustainability has dropped from 36% of companies as recently as 2021, when we published the previous Barometer, to 25% today. Leaders say that just 9% of their sustainable procurement programs are driven by cost reduction.
Stakeholder Engagement -- Data integration, analytics, and the use of a robust digital platform are key here. Combining ESG performance data with spend
analytics provides insights that procurement that leading CPOs use to communicate the impact of their program to C-suite peers. Programs reporting high integration have best practice adoption rates 1.7 to 2 times higher than those with lower integration, and are 3 to 4 times more likely to have “strategic-level
engagement” with C-suite stakeholders.
Read the full article here.
