To achieve sustainability in the supply chain, it is essential to communicate and interact with suppliers at various stages of the purchasing cycle. This helps to ensure that the process is sustainable.
Brokering effective communication and interaction between suppliers and organizations is one of the most important roles of buyers.
When it comes to corporate citizenship and sustainable practices, businesses that prioritize these values are looking for suppliers who share their commitment. In order to ensure alignment, companies must first establish and adhere to their own internal sustainability standards before expecting the same from their suppliers. To monitor suppliers effectively, organizations should clearly communicate their expectations and use established metrics to conduct audits. While in-person monitoring can be more effective in documenting violations and pressuring suppliers to comply, it may be challenging for offshore suppliers without third-party auditors. Alternatively, organizations can encourage suppliers to adopt transparent sustainability reporting, such as the Global Reporting Initiative. It’s essential for buying organizations to lead by example and follow the same standards they hold their suppliers to.
Common Required Sustainability Activities During Supplier Purchasing
The following activities are ongoing throughout the supplier purchasing and relationship processes:
1. Communicate sustainable procurement policies and objectives to suppliers and contractors.
2. Develop key performance indicators for suppliers to include sustainable factors (Note: See the section on Procurement Metrics.)
3. Monitor and audit supplier performance.
4. Assist suppliers with becoming compliant with the buying organization’s sustainability requirements.
5. Collaborate with suppliers and distributors to address sustainability issues with products and services, and improve the economic, social, and environmental characteristics.
6. Handle consumer criticisms of supplier lapses in sustainability.
7. Identify and implement opportunities for sustainable improvements and sustainable innovations by suppliers.
Collaborating with Suppliers
Many organizations discover that some of their suppliers have already started sustainability initiatives and possess valuable programs or expertise. Purchasing personnel can benefit from collaborating with these suppliers to obtain additional information and insights. For instance, suppliers can provide suggestions on how to decrease the environmental impact of a product, propose eco-friendly materials as substitutes (like water-based solvents and reusable packaging), or inform about new disposal or recycling methods for materials.