Sustainable procurement

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Sustainable procurement

Sustainable procurement is the process of integrating your sustainability goals into procurement and purchasing practices. It involves considering social, economic and environmental factors alongside the usual price and quality considerations when buying goods and services.

This approach is the best starting place to turn your strategy into action since the supply chain is where most ESG risks materialise for many companies. A sustainable procurement & supply chain strategy is therefore instrumental in reaching progress on key targets.

Benefits of sustainable procurement

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Realise your climate targets

Typically, Scope 3 emissions account for 80% to 90% of a company’s total emissions. An important chunk of that is linked to what you buy. This makes it impossible to make real progress on climate without involving procurement.

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Respond to clients expectations

A recent study revealed that 90% of UK and EU respondents consider ESG factors crucial in selecting suppliers. This means that these companies are likely to inquire with their suppliers what sustainability action they take or even formulate more explicit expectations.

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Get your certifications

Procurement performance is one of the 4 pillars of EcoVadis. To obtain a good score, it’s crucial to put in place the right procurement policies and procedures. Improving your ESG score can facilitate access to capital and will help you secure contracts from private and public buyers.

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Protect your reputation

Misconduct at suppliers can harm your reputation. E.g. in the last years, companies in the construction, logistics, and textile sector made headlines due to social misconduct at suppliers. A sustainable procurement strategy manages such risks.

A pragmatic approach to start

While the idea may sound ambitious, starting with sustainable procurement doesn’t have to be overwhelming. Here are a few first steps you can take:

Map your spendings and supply chain: Identify high-impact categories and suppliers – on every level: environmentally, socially, or reputationally.
Set clear expectations: Develop a supplier code of conduct or integrate your ESG criteria into RFQs and contracts.
Engage your suppliers: Collaboration is key. Many suppliers are already making strides in sustainability and are open to dialogue.
Start small and scale: Pilot in one product category or business unit, gather insights, and then expand gradually.
Measure and improve: Track progress over time, not just on cost and quality, but also ESG performance.