The term responsible is defined as having an obligation to do something, or having control over or care for someone, as part of one’s job or role, according to the Oxford Dictionary. However, for buyers this term has additional meaning: conducting procurement with awareness of environmental, health and safety, human rights, cost, and efficiency implications.
Procurement professionals that can balance all of these things are classed as being ‘responsible buyers’ and there is an increasing demand to add value in this way. Indeed, most companies have a responsible procurement policy in place.
So what does a responsible buyer actually look like?
Environmental awareness and sustainability are now incredibly important for the procurement process and businesses around the world are putting the focus on these principles.
Skanska is just one company which has created a sustainable procurement policy directive. “Sustainable procurement is the value for money sourcing of products and services taking into account environmental, social and ethical aspects over the whole product or service lifecycle,” the organisation writes. “Skanska see this as essential and efficient business practice, which is integral to the way we work. It helps us to make properly informed and balanced decisions when procuring the products and services needed for our projects.”
“Skanska will only do business with responsible suppliers and subcontractors who understand the nature of the products, materials and services they are supplying, and who recognise their responsibility to protect the environment and foster good relations with their employees and local communities.”
As part of its responsible procurement promise, Balfour Beatty also has a focus on the environment. When challenged by a client to reduce costs on a programme by 18 per cent it created a more sustainable supply chain by building off-site to generate zero waste, reduce build-times by 95 per cent, deliver a factory tested solution, and reduce the impact on the local environment and community.
To be an environmentally responsible buyer, there needs to be a focus on implementing systems to raise awareness across the supply chain, efforts to reduce climate change, a responsible use of resources, such as recycling, and supporting biodiversity. Working with suppliers accredited to ISO 14001 or an equivalent, such as CEMARS which is offered by Achilles, is important. This demonstrates compliance with the Energy Savings Opportunity Scheme (ESOS), which requires ‘large undertakings’ and their corporate groups to submit reports on their energy usage and efficiency.
At no point should procurement activity put at risk the health and safety of anyone in the supply chain.
This means that everyone involved throughout the chain must work in a safe, non-exploitive environment.
Skanska ensures this through a zero accidents policy, which demands an effective health and safety management system is in place to identify and mitigate risks.
At Achilles, we can validate key areas of supplier risk including health and safety through our audits to help you be responsible by validating a supplier’s capability, competence and compliance to relevant industry criteria.
“It’s a sad truth that in these modern times we are still talking about the enforced slavery of human beings,” the Chartered Institute of Purchasing and Supply (CIPS) wrote in a blog.
The Walk Free Foundation estimates that there are 29.8 million people in modern day slavery, including around 5,000 slaves in the UK that are making clothes and picking food.
Responsible buyers will have full visibility of their supply chain through supply chain mapping and have strict corporate social responsibility policies to ensure they only work with companies who can demonstrate that there are no instances of slavery.
Of course, being an effective responsible buyer is about getting the most for the company’s money. You need to be able to add value through procurement and ensure money is being properly managed. However, costs have to be balanced against other considerations – i.e. all of the above.
Procurement departments are one of the main drivers of efficiency, ensuring supply chains are run effectively and are routed in such a way as to ensure a sustainable, resilient service.
Buyers that can do this without compromising on other considerations will demonstrate how responsible procurement can work to improve operations.