@Risk

Think sustainable sourcing is nothing more than a passing fad, a trend that will wither away during the recession?

Think again.

According to new research by HEC Paris and sustainable procurement experts EcoVadis, 90% of buyers now consider sustainable procurement “important” or “critical.”

What’s more, over 80% of procurement directors who participated in the survey said they invested in sustainable purchasing initiatives in 2008 –and 35% report that they intend to increase spending in this area, despite the budget cuts that are affecting most companies these days.

“Sustainable procurement is an integral part of the new model that companies must adopt to survive and thrive in today’s global economy,” says HEC professor Olivier Bruel, principal author of the report. “Our research clearly shows that the economic dimension of sustainability – total cost of ownership reduction as well as supporting suppliers in dire financial situations – is a critical focus for companies as they attempt to weather the financial storm while continuing to run their businesses in a socially and environmentally friendly manner.”

The report suggests that organizations adopt these six principles to help them structure their sustainable procurement approaches:

• Measure. Correctly implement measurement indicators that relate specifically to your core motivations: risk management, cost cutting, and value creation.

• Remember the economic fundamentals of the triple bottom line. Creating sustainable relationships with your suppliers helps mitigate the risk of supply chain disruptions, and ultimately, that’s essential to your business success.

• Focus on products and suppliers simultaneously.

• Don’t reinvent the wheel. Sustainable procurement can often be implemented as a continuation, or broadening, of existing sourcing processes.

• Establish sustainable sourcing as a dedicated corporate project with a defined scope and result obligation.

• Provide appropriate resources. According to the report, “…1% of the Procurement budget of any structure, regardless of the economic crisis, is nothing when compared with the stakes involved and the need to make a significant and profound change both in terms of supplier markets and the range of products and services.”

I agree with the authors as they (enthusiastically) conclude, “We strongly believe that ‘21st century procurement can only be sustainable!’”

The Sustainable Procurement Benchmark Report is available for download at www.ecovadis.com (registration required).