In a world facing increasing environmental and social challenges, sustainable procurement is emerging as a vital tool for organisations committed to responsible business practices. Sustainable procurement involves integrating environmental, social, and ethical considerations into purchasing decisions to minimise negative impacts and create positive change in supply chains.
This post is essential reading for procurement professionals, business leaders, and sustainability officers who seek to transform their supply chains into a force for good. At ITLawCo, we recognise that procurement is more than just transactions; it’s a strategic driver for creating positive change. In reading this post, you’ll discover the principles of sustainable procurement, its essential components, and practical steps to implement these practices within your organisation.
Rethinking procurement: Beyond cost and efficiency
Traditionally, procurement has been viewed through the lens of cost and efficiency.
However, sustainable procurement challenges this paradigm by emphasising the triple bottom line—people, planet, and profit. This approach aligns with the ISO 20400:2017 guidelines and modern procurement laws like section 21 the Public Procurement Act 28 of 2024. Together, they offer a framework for integrating sustainability into procurement processes.
Principles of sustainable procurement
Environmental responsibility
- Resource efficiency: Move beyond conventional practices by prioritising renewable energy sources such as solar, wind, and geothermal energy. Embrace innovative water conservation methods like rainwater harvesting and greywater recycling, and adopt a circular economy mindset that minimises waste and maximises material reuse.
- Climate change mitigation: Partner with suppliers to implement cutting-edge technologies that reduce greenhouse gas emissions, such as using electric vehicles for transportation and investing in energy-efficient manufacturing processes. Explore carbon offset programmes and strive for carbon neutrality in your supply chain.
- Biodiversity and habitat protection: Foster sustainable agricultural, fishing, and forestry practices that go beyond compliance to actively enhance biodiversity and ecosystem services. For instance, prioritise suppliers who use organic farming methods and avoid deforestation.
Social equity
- Community development: Shift the focus from global suppliers to local ones, driving economic growth in your community. Support initiatives that provide essential goods and services to underserved populations, creating a ripple effect of positive impact. For example, partner with local farmers to source fresh produce for your company cafeteria.
- Fair labour practices: Go beyond ensuring compliance with labour laws by engaging in proactive capacity-building programmes that uplift your suppliers and their workers. This could include providing training on fair wages, safe working conditions, and workers’ rights.
- Health and safety: Invest in long-term health and safety improvements, not just for immediate compliance but for the sustained well-being of workers and communities. This could involve implementing safety protocols, providing protective equipment, and offering regular health check-ups.
Economic viability
- Ethical conduct: Elevate ethical standards by fostering a culture of transparency and integrity. Implement training programmes and robust anti-corruption policies that set a new benchmark for ethical procurement. Conduct regular audits to ensure compliance and address any issues promptly.
- Supplier development: Cultivate innovation by building long-term, strategic relationships with suppliers. Implement supplier diversity programmes that open doors for under-represented groups, driving innovation and resilience in your supply chain. Offer mentorship and support to help these suppliers grow and succeed.
Actionable strategies for sustainable procurement
To truly integrate sustainability into procurement, organisations should:
- Develop clear policies: Craft policies that reflect your organisation’s values and sustainability goals, making them a central part of your procurement strategy.
- Establish top-level accountability: Ensure that senior management, particularly the head of procurement, is accountable for sustainability outcomes. This could involve setting sustainability targets as part of their performance evaluations.
- Set SMART objectives: Define specific, measurable, achievable, realistic, and timely objectives for sustainable procurement, and track progress rigorously. Use key performance indicators (KPIs) to monitor your progress and identify areas for improvement.
- Engage stakeholders: Foster collaboration with suppliers, customers, and local communities to create a shared vision and achieve sustainability goals together. This could involve holding regular meetings, conducting surveys, and seeking feedback.
Case study: Patagonia’s sustainable supply chain
Outdoor clothing company Patagonia is a prime example of how you can implement sustainable procurement successfully. The company has a programme focusing on:
- reducing environmental impact,
- ensuring fair labour practices, and
- supporting social initiatives.
Patagonia carefully selects suppliers who share its values and works closely with them to improve their sustainability performance. The company also uses recycled materials in its products and has a robust programme for repairing and recycling old garments. As a result of its efforts, Patagonia has become a leader in sustainable business practices.
Measuring the success of sustainable procurement
To ensure that sustainable procurement initiatives are effective, we need to measure their success. You can do so using various metrics, such as:
- Environmental metrics: These could include measures of greenhouse gas emissions, water usage, waste reduction, and the use of recycled materials.
- Social metrics: These could include measures of fair labour practices, community engagement, and supplier diversity.
- Economic metrics: These could include measures of cost savings, innovation, and risk reduction.
By tracking these metrics, organisations can identify areas where they are making progress and areas where they need to improve. This data can then be used to inform future procurement decisions and ensure that sustainability remains a top priority.
ITLawCo’s commitment to sustainable procurement
At ITLawCo, we believe that sustainable procurement is not just a responsibility but a strategic opportunity to drive global change. By embedding sustainability into your procurement practices, you can create a supply chain that supports environmental health, social equity, and economic prosperity. Our team of experts is ready to help your organisation develop and implement cutting-edge sustainable procurement strategies that align with international standards and best practices. Join us in leading the charge towards a more sustainable future by contacting us today.
