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Responsible Sourcing is “a voluntary commitment by companies to take into account social and environmental considerations when managing their relationships with suppliers”, according to the International Chamber of Commerce.
During our Responsible Sourcing webinar on 9 September, we examined environmentally sustainable responsible sourcing practices, along with ethical considerations regarding labour standards.
37% of webinar attendees agreed that climate change is their biggest supply chain sustainability issue, however 9 out of 10 attendees knew little to nothing about the ISO 20400 standard on sustainable procurement.
“Set out your ambitions to your supply chain in the form of a policy, a charter, a requirements document etc.”, said Shaun McCarthy OBE, Director, Action Sustainability; “There are lots of good reasons to do this, firstly internally – everybody knows what your sustainable aims are; and secondly externally – as an early signal to your supply chain so they compete around what you’re asking for. If you present something to your supply chain last minute as something new, the chances are the price will go up, so it’s very important to signal the requirements at an early stage.”
While sourcing sustainably is well known for the environmental considerations, it also covers sustainable and ethical labour.
Only 18% of attendees are conducting supplier audits to promote responsible sourcing within their organisation and supply chain, and only 27% have a supplier code of conduct. Looking at ISO standards for corporate social responsibility and sustainable procurement are important, but organisations must also look beyond the standard and how they implement this within their business. Looking at how your supplier’s workers are employed, their contractual agreements and how they are treated is a key aspect to consider when sourcing responsibly.
Adam Whitfield, Quality Assurance & Audit Programme Manager Achilles said, “The audits we carry out are on businesses who are considered to have robust systems in place in terms of a code of conduct, prequalification processes etc.
“However, it doesn’t mean that having these policies and procedures means the work stops there”. Adam went on to highlight some of the unethical discoveries Achilles encountered during these audits that show the importance of monitoring suppliers when organisations are looking to source responsibly and ethically.
Business must be conducted in a manner which embraces sourcing sustainably and reduces environmental impact while upholding ethical labour standards.
For buyers this means procuring with heightened awareness of environmental, health and safety, human rights, cost, and efficiency implications. Don’t rely on the adherence of suppliers, use audits, workforce engagement surveys and site inspections to assess compliance to responsible sourcing standards.