We would like to get more involved in including sustainability initiatives during our procurement process and the selection of supplier process. We want to work with our procurement team on this. What are some of the methods other organizations and companies have used in engaging with suppliers with their sustainability initiatives?
-- Barry Enix | Buckman
The question above was posed on the 2Degrees platform for sustainability professionals. It's a great question, and one that we frequently tackle in our work with clients seeking to push sustainability beyond their direct operational boundaries.
Here's what SSC President Jennifer Woofter said:
I find that effective supplier engagement needs three components: a policy element, a program element, and performance element.
The policy element is intended to explain the expectations that you have for suppliers in the area of sustainability. A supplier code of conduct, for example, will outline which sustainability issues (labor, environment, human rights, grievance processes, health and safety, etc.) you expect suppliers to address and comply with. Inserting similar requirements into supplier contracts, RFP/RFQs, etc. will ensure that the policy has "teeth" and can be used in contract decisions.
Supply chain programs including training and capacity building -- for both the suppliers themselves, but also for your procurement staff. Do purchasing managers know what to look for in a "sustainable" supplier? Are sustainability aspects incorporated into new vendor evaluations? What kind of auditing, self-assessments, corrective actions, and negotiation tools are available on each side? Robust programs will ensure that your policy isn't just a document on a wall somewhere, but is an active expectation lived out in day-to-day decision-making.
The final component is effective performance measurement. Sustainability professionals like to say "what gets measured gets managed" and it's essential that any supplier engagement program have effective metrics. You might begin with simple measures like "how many suppliers responded to our survey" or "how many suppliers attended our sustainability training," but generally I advocate moving to more outcome-based metrics such as "how much did serious incidents decrease after suppliers participated in our safety training?" and "how many tons of carbon emissions were suppliers who engaged with us able to reduce (as compared to non-engaging supplier)?" These kind of indicators will give you a much better sense of how effective your engagement efforts are -- and give you insight into what new initiatives are most likely to give you the results you seek.
Want to see what other sustainability practitioners recommended? Read the entire discussion over at 2Degrees.