On 21st March, we celebrate World Sustainable Procurement Day (WSPD). This will be the third annual WSPD led by the Sustainable Procurement Pledge (SPP). With the motto “#collaborate2accelerate”, this day aims to empower and equip procurement professionals from all over the world in their journey towards sustainable procurement. WSPD aims to shine a light on hot topics in the supply chain and procurement space, including reducing Scope 3 emissions, human rights, supplier diversity, social procurement, the legislation, and regulation landscape that instigates global changes in the procurement profession, and emerging topics such as Artificial Intelligence (Ai) and other major step change in technology.
At Accelerate, sustainable procurement is a cause very close to our hearts (you can see more of what we have to say about this important topic here and here.) World Sustainable Procurement Day presents the perfect opportunity to look at some of the challenges we’re currently facing when it comes to achieving sustainable procurement, as well as some tips on how to overcome them.
Sustainable procurement: what are the current challenges?
Sustainable procurement is a critical aspect of modern business practices, reflecting a commitment to social responsibility and environmental stewardship. However, navigating the complexities of sustainable procurement can pose significant challenges.
Challenge 1: Supply Chain Transparency
One of the primary challenges in sustainable procurement lies in achieving supply chain transparency. Many companies operate within vast and intricate supply chains that span the globe. Identifying and understanding the environmental and social impacts at each stage of the supply chain can be a daunting task.
Solution: Implementing Technology and Collaboration
To address this challenge, organisations can leverage technology solutions such as blockchain and data analytics to enhance visibility into their supply chains. Collaborating with suppliers and encouraging them to adopt sustainable practices is also essential. By fostering open communication and partnerships, businesses can work collectively to improve supply chain transparency.
Challenge 2: Compliance with Regulations and Standards
Another hurdle to sustainable procurement is the need to comply with various regulations and standards. Navigating the intricate landscape of international and local regulations, along with adhering to industry-specific sustainability standards, can be a complex and time-consuming process.
Solution: Establishing Robust Compliance Protocols
Organisations can overcome this challenge by establishing robust compliance protocols. This involves staying informed about relevant regulations and standards, conducting regular audits, and implementing internal controls. Engaging with industry associations and certification bodies can provide valuable insights and support in maintaining compliance with evolving sustainability requirements.
Challenge 3: Balancing Cost and Sustainability
A common concern for businesses is finding the right balance between cost considerations and sustainable procurement practices. Some environmentally friendly and socially responsible products and services may come with higher price tags, posing a dilemma for organisations looking to maintain profitability.
Solution: Total Cost of Ownership (TCO) Evaluation
To address this challenge, businesses should adopt a Total Cost of Ownership (TCO) approach. Instead of focusing solely on upfront costs, TCO considers the entire lifecycle of a product or service, including maintenance, disposal, and environmental impacts. This holistic perspective allows organisations to make informed decisions that align with their sustainability goals without compromising financial viability.
Sustainable procurement: how we can help?
Achieving sustainable procurement is undoubtedly a journey fraught with challenges, but with strategic planning and proactive measures, organisations can overcome these hurdles. By prioritising transparency, compliance, and a balanced approach to cost and sustainability, businesses can contribute to a more sustainable and responsible global supply chain.
If you’re keen to make your own procurement practises more sustainable, we can help. Accelerate is a procurement consultancy and we pride ourselves on our approach to sustainable procurement. We work with our clients to help them overcome challenges and achieve more sustainable procurement processes.
Get in touch today for a chat about how we can support you.