By Nicole Sherwin
Companies are only beginning to uncover the best practices for engaging suppliers on sustainability. With suppliers providing the major inputs for the operations of businesses, it would only make sense that companies would be eager to engage this specific stakeholder on sustainability issues, but many companies are still fumbling over how to approach it. One of the main issues is that companies are stuck in a top-down mentality when it comes to supplier relationships; they implement policies and resort to monitoring suppliers, rather than engaging them. Yet, changes are afoot as companies begin to realize the importance of supplier engagement and collaboration as part of their sustainable procurement strategy.
Sustainable Procurement itself is a late bloomer in regards to the evolution of all corporate social responsibility practices. Companies need to look internally at their own environmental and social practices before requiring those around them to conform. Still, even large corporations that have been involved in Corporate Social Responsibility for some time are just beginning to take the most basic steps towards establishing Sustainable Procurement management systems. For example, Mattel Inc., under pressure from Greenpeace, has recently agreed to establish a sustainable procurement policy and just a few months ago Dow Chemical Company launched their first Code of Business Conduct for Suppliers. These companies are not small unsuspecting organizations, and yet the essential foundations to build a sustainable supply chain are just being laid.
While policies, supplier codes of conduct, or CSR clauses within supplier contracts, are a critical first step, the act of engaging suppliers has been traditionally conducted from a defensive position. Suppliers are inundated with questionnaires, obliged to forgo audits, and subject to other monitoring practices. These one-sided business processes have their purpose, but they usually focus on the negative or aim to punish suppliers for non-conformity. With this approach, suppliers are not encouraged or motivated to change because they are not included in the process.
Monitoring suppliers is certainly part of a sustainable procurement strategy, but a complete strategy will also include a means to engage and support supplier improvement. Some of the emerging best practices include:
[Image Credit: Peter Shanks via Flickr - under creative commons license.]
Nicole Sherwin holds an MBA in Sustainable Management from Presidio Graduate School. She currently works for EcoVadis as a CSR Analyst in Paris, France.