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PurchasingB2B

Sustainability 101

A how-to primer on advancing the sustainability agenda at your workplace


December 20, 2011
by Michael Power

Purchasingb2b November/December 2011 print edition

These days, just about every organization has an eye on sustainable initiatives, and many companies are working to integrate those initiatives into how they do business. But what are the steps companies must take to get sustainability initiatives up and running, or to advance the policies they already have? The following is a compilation of the top-10 suggested tips on how to do just that.

Buy-in from the C-suite
For sustainable procurement programs to work effectively, there first needs to be a commitment from the highest levels within an organization, says Victoria Wakefield, purchasing manager, student housing and hospitality services at the University of British Columbia. While some organizations move forward with sustainability initiatives without that support, it’s become increasingly rare to see companies that aren’t making sustainability one of their overarching commitments in mission statements or other statements of corporate commitment.

“Without that, it’s really hard to get staff focused on it, make it a priority, or even to have permission,” she says. “So commitment from the senior level is really important.” The most effective way to get that commitment is to prove the benefits of sustainability, Wakefield says. Sustainability practices are widely accepted in the public sector and are usually written into the mission statement and strategic plan. “For public procurement it’s not so much of a hard sell,” she notes. “For private organizations, it’s more of a marketing need. Because your customer base is looking for how they can make a difference with their spend. It’s not just about buying stuff—it’s about how they are able to leverage that spend.”

Bob Purdy director of external relations and corporate development for the BuySmart Network—formerly the Sustainability Purchasing Network—said purchasing professionals seeking buy-in can look at their organizations’ existing corporate social responsibility (CSR) strategy and try to piggyback purchasing policies on top of that overall strategy. As well, he recommends compiling the business case for a sustainability program then presenting it to senior management and, ideally, the board.

“To get that senior commitment, it’s a good idea to find allies and champions within the organization and even some external champions within your industry,” he says. “There’s nothing better than a bit of friendly competition within a given sector. If you see another organization raising the bar on sustainable purchasing it’s a great way to encourage similar action within your own organization.”

The Greater Toronto CivicAction Alliance has developed a single-page document that senior-level employees from organizations can sign to show their commitment to continuous improvement towards making more sustainable purchasing decisions, says Linda Weichel, vice-president, partnerships, for the group. “It’s really a way to get senior leadership focused on this.”

Overarching sustainability policy
Next, an organization should develop a sustainability policy that communicates sustainability priorities in terms of financial, social and environmental impacts, says Wakefield. Such a policy will help guide an organization’s procurement staff by providing a framework, while providing a certain amount of “permission” to pursue sustainability efforts. “That framework communicates down to purchasing, because ultimately what you want is your purchasing team to be implementing criteria around sustainability into their bids and their asks,” she says.

It helps to ensure an overarching policy gets embedded in sourcing procedures across an entire organization, says Weichel. Purchasing can be done within the procurement department, but also by employees from across an organization, she notes. “It’s one thing to have it as a document somewhere, but it really needs to be incorporated by whoever is making purchasing decisions,” she says.

A policy represents a formal signal that sustainability is a priority for an organization, says Purdy, and collaboration is especially important when setting up that policy. That means collaborating with staff who ultimately will implement that policy, as well as with suppliers. As well, he notes, it’s best not to try to do all the work at once, or to do that work in isolation. “When you use that collaborative approach you identify islands of innovation within an organization that are already doing the work,” he said.

Understand the business benefits
Having a clear business rationale for why an organization is prioritizing sustainability helps ensure procurement staff has a clear notion of why they’re pursuing those measures, says Wakefield. While an overarching framework is important, staff must understand what that policy means to the bottom line, and the leadership team and procurement must work to define the benefits for staff, such as setting guidelines for how much post-consumer content paper can contain.

Wakefield likened sustainability to a three-legged stool, with financial, social and environmental considerations comprising its legs. “In procurement we’re a business first,” she says. “Our job is to bring best value to the organization so the alignment to the fiscal piece is very important. Often people talk about the environment and the social and they miss fiscal. You’re not a player unless you’re fiscally sound.”

During tougher times, it can be easy for organizations to allow efforts to fall by the wayside if there’s no business case for sustainability, says Purdy. Along with “moral imperatives” and softer benefits like brand recognition, organizations must understand the financial drivers behind the push for sustainable purchasing. “For example, a real classic case is energy efficiency,” he says. “If you’re buying high-efficiency light bulbs or upgrading your HVAC system to be more efficient, usually there’s a strong rationale for doing that in terms of reduced energy costs.”

Goals and targets
To implement a sustainable procurement strategy, it’s important to identify what an organization wants to achieve. Goals and targets help bring an organization’s overarching policies down to ground level, Purdy notes. As well, setting and achieving goals allows organizations to tell the world about those achievements. “And not just greenwash,” he said. “You’re actually able to quantitatively show how you’ve been able to achieve your goal.”

And if you’re not working towards anything you’re basically working towards nothing, says Wakefield. Senior management and the leadership team can work to define those targets. From there, staff can work to hit whatever targets get set. For example, the University of British Columbia sources 50 percent of its food—grown, produced or processed—within 150 miles of campus.

“For UBC it makes it quite tangible for the staff when they’re working towards procurement to understand what they’re looking for,” Wakefield says. “When they work with suppliers they can say, ‘how are you contributing to my goal?’”

Develop tools

Along with policies and an overarching framework, buyers must have tools and resources to carry out those policies. Those tools can include a supplier code of conduct, RFP clauses, evaluation criteria and resources on who to network with. For example, CivicAction has been working with organizations on waste contracts and the clauses built into those contracts, says Weichel. Those clauses guide waste haulers on what they do with the waste, for example, how much gets diverted from landfill, she notes. “There are some building owners who don’t even know where it goes,” she says. “The agreement is, this company will come and take it away; you can really build a lot of specifics into your contracts to guide the supplier in what they do with your waste.”

The internet has provided access to an enormous amount of information about sustainability, says Wakefield. There’s no shortage of consultants who will, for a fee, draft documents that give a tip of the hat to sustainability. The Purchasing Management Association of Canada (PMAC) also provides seminars, courses and other tools on the topic, Wakefield says, adding suppliers can be a valuable resource.

Also helpful is legislative alignment, says Purdy. Some legislative and regulatory frameworks—such as building codes, environmental bylaws and zero-waste programs—can have a bearing on purchasing priorities. “You have to be aware of the legislative environment in which you’re working and make sure you’re purchasing in ways that are consistent with or exceed legislative and regulatory requirements,” he said.

Sustainable expertise
Integrating fiscal, social and environmental goals into the purchasing process can be complicated. It can be helpful to have a staff member who understands the issues and can help with the decision-making, says Wakefield. This is where networking becomes such a valuable process. She recommends researching which organizations, suppliers, municipalities and associations are engaged in sustainability and how to connect with them.

“Most people can take a look inside their organizations and there’s probably somebody (who can help),” she says. “If they’re a smaller organization they won’t have a sustainability person but they may have a safety officer, they may have somebody that’s in the role in public affairs or communications who understands the issues and can help.”

A cross-functional focus also helps, with representatives from different departments available to ensure buy-in and implementation. For example, if a purchaser wants to buy hoisting equipment, it’s possible to network with staff from the warehouse, from health and safety or other departments.
“The cross-functional dialogue is important—making sure purchasing isn’t acting on an island,” she says. “That also helps ensue there’s team buy-in.”

Purdy recommends (especially while transitioning towards sustainability) organizations not only dedicate an internal resource to implementing new policies, but go beyond current staff to ensure those policies are set up correctly. “From our experience it’s really difficult to layer on responsibility for that onto existing staff,” he said.

Awareness and training
Once senior management approves a policy or framework, it’s important staff understand that policy and have the tools necessary to put them in place, says Wakefield. Education and support for courses and seminars is important, she notes. As well, building training into job performance and expectations is also an effective approach.

“Do they know how to measure carbon emission? Do they know what food miles are? What’s a green roof? How do you read through the material and understand LEED certification?” she says. “These are all terms that, for the most part, unless they’re new through the purchasing training, they weren’t given those tools as part of the course curriculum.”

Sometimes, sustainable purchasing gets implemented in organizations “off the side of someone’s desk,” says Purdy. It is important to allocate enough staff to implement sustainability policies, and they need access to education on the topic. The BuySmart Network also offers sustainable purchasing courses to help procurement professionals implement those policies.

Supplier communication and engagement
While implementing a program, organizations should also strive to ensure suppliers are engaged with any changes or developments, Weichel says. Current and prospective vendors should know that a commitment to sustainability is something an organization is pursuing. “You’re going to be looking to them to demonstrate their commitment to…sustainability through their own practices, as well as the products and services they’re offering,” she says.

It’s also worth noting suppliers are often the ones driving change towards sustainability, says Purdy. Often, he notes, the supply community has lots to offer purchasers in terms of ideas and inspiration. “Some of these big companies have their own corporate social responsibility policies and so those suppliers are the ones you want to do business with because they’re pushing the envelope,” he says.

Tracking and monitoring
Devising ways to measure the impact of sustainability policies is particularly important after making a case to senior management for cost reductions arising from those policies, says Weichel. Doing so helps ensure an organization’s upper management remains committed. “It reinforces the commitment, sustains the interest and, ideally, gives everyone the positive reinforcement they need to keep going.”

As well, what gets measured gets managed, Wakefield says. Tracking and monitoring can show whether sustainability efforts are on course or if a correction is needed. Areas such as how much waste gets diverted from landfill, what gets recycled, how far products must travel, the use of green cleaning supplies and recycled content in paper products can all be tracked.

Monitoring whether suppliers are meeting expectations also helps organizations ensure sustainability programs stay on track, Wakefield notes. “Typically, we kind of just issue the purchasing order and walk away,” she says. “That’s not the value-add we bring to organizations. Our job is to continually monitor the supplier base and make sure they toe the line and continue to be strategic partners to the organization.”

Continuous improvement and celebration
And while improvement is necessary, don’t forget to celebrate when things go right, our experts agreed. To keep momentum, organizations must tell people about the good work they do. “Celebrate the wins, take a pause and get the communication out there on what you’ve done well,” Wakefield says.
A good program will acknowledge no organization can do everything at once, Purdy says. “You’ve got to start realistically and practically and build the sphere of influence over time—assess you’re progress, make improvements and remember to celebrate.”        b2b