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Recognized Standards in Procurement: International Organization for Standardization

One of the most globally recognized standards for minimizing harmful effects on the environment is the voluntary series of standards established by the International Organization for Standardization. Organizations can use the structured toolset to identify and control the impact their processes, products, and services have on the environment.
Specifically, the ISO 14001 certification, established in 1993, provides the criteria for establishing an environmental management system (EMS). Because the standards are applicable to any organization, many firms now require suppliers to become ISO 14001 certified in order to demonstrate their compliance.  As of 2020, there are over 300,000 certifications awarded to companies in 171 countries. 
Expand each of the following to learn more about ISO standards.

ISO 14000

ISO 14000 provides “a series of generic environmental management standards…that provide structure and systems for managing environmental compliance with legislative and regulatory requirements and affect every aspect of a company’s environmental operations” (APICS Dictionary, 16th edition)

Benefits achieved through ISO 14001 certification include:

  • Reductions in waste
  • Decreases  hazardous material and pollutants generated
  • Reductions in energy and other resource consumption
  • Better environment regulatory compliance for reduced liability and risk
  • Cost savings and reductions in insurance premiums
  • Improved public and community goodwill due to a corporate image of social responsibility

Environmental Management System (EMS)

The successful adoption of an ISO 14004-based EMS is often the driving force for sustainability through an organization’s supply chain. Because it is a universal approach for an organization, it requires a commitment from top management, and should be part of the overall environmental policy.  Environment management manuals should be documented and employees and suppliers trained on their roles and responsibilities.  The following are some of the aspects of an EMS:

  • How the company will evaluate the environmental impact of its products and processes, including identifying the environmental risks of the business and its suppliers
  • How the company will monitor and measure its performance, such as putting processes in place to record resource and energy usage
  • Documenting the approach the organization will use to address any environmental issues or in the event of an environmental incident
  • Identify goals, steps and action plans that will be taken to improve its environmental performance in specific areas

Due to their responsibility with the materials used in processes, and their contact with the suppliers who provide those materials, procurement plays an important role in helping develop the EMS.  For example, if a company purchases or produces hazardous materials, purchasing would develop EMS guidelines for the procurement of waste disposal services, such as what constitutes a qualified contractor under local, state, and federal laws.

ISO 20400:2017

The guidelines known as ISO 20400:2017 provide direction for firms to integrate sustainability into the various stages of the procurement process.  It outlines sustainable procurement principles, as well as identifying methods for creating a culture of sustainability.

ISO 26000:2010

An international Social Responsibility standard that integrates with the GRI is ISO 26000:2010. ISO 26000:2010 assists “organizations in contributing to sustainable development beyond legal compliance through a common understanding of social responsibility” (APICS Dictionary, 16th edition). It also provides a structure on how they can apply the principles to their operations.  
Areas or organizational governance within ISO 26000:2010 are:

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