Sustainable procurement entails a systematic approach to purchasing, wherein an organization's acquisition of goods and services is undertaken in a manner that generates positive outcomes for both the organization and society at large, while simultaneously minimizing environmental impacts. This is achieved by ensuring that suppliers' employees are provided with decent working conditions, products and services acquired are sustainable, and socio-economic concerns, such as inequality and poverty, are effectively addressed. In this article, we will explore the environmental and economic aspects of sustainable procurement.
Environmental Aspects of Sustainable Procurement
Sustainable procurement aims to reduce the environmental impact of procurement activities by promoting the use of environmentally friendly products and services.
Environmental considerations can be integrated into the procurement process by assessing the environmental impact of the products and services.
The following are some of the key environmental aspects of sustainable procurement.
Reduction of Carbon Footprint
Carbon footprint refers to the amount of carbon dioxide and other greenhouse gases emitted due to human activities. Procurement activities can contribute significantly to the carbon footprint of an organization as the choice of the products to purchase as well as the linked logistics have a climatic impact in terms of emissions embodied.
Sustainable procurement aims to reduce carbon footprint by promoting the use of low-carbon products and services, reducing waste, promoting energy efficiency and green logistics.
The necessity to reduce emissions in order to comply with international standards and market requirements and regulations is pushing many companies to wide the scope of analysis of their emission, in order to incorporate the so-called “Scope 3 emissions” related to the value chain.
Resource Efficiency and waste reduction
Sustainable procurement also promotes resource efficiency by encouraging the use of products and services that are designed to minimise the use of natural resources and reduce waste.
This can be achieved by promoting an eco-design approach, the use of recycled products, reducing packaging and promoting the use of renewable energy sources.
Biodiversity
Sustainable procurement also promotes the conservation of biodiversity by promoting the use of products and services that are environmentally friendly.
This can be achieved by promoting the use of products that are certified as being environmentally friendly, such as those that have been certified by organizations like the Forest Stewardship Council (FSC).
Economic Aspects of Sustainable Procurement
In addition to the environmental benefits of sustainable procurement, there are also significant economic benefits.
Sustainable procurement can have a significant impact on the economy by promoting economic growth, supporting the local economy and promoting fair trade.
The following are some of the key economic aspects of sustainable procurement:
Promoting Economic Growth
Sustainable procurement can promote economic growth by supporting the development of sustainable industries.
By procuring products and services from sustainable industries, organizations can help to create jobs and promote economic growth while ensuring that the impact of the value chain (Scope 3) is reduced.
Supporting the Local Economy
Sustainable procurement can also support the local economy by promoting the use of local suppliers reducing the geographical scope of the supply chain.
This can help to create jobs and support the development of local businesses while reducing the environmental footprint of logistics and operations.
Fair Trade
Sustainable procurement can promote fair trade by promoting the use of products and services that have been produced in an ethical and sustainable manner.
In this context, it is possible to evaluate products on the basis of certification that ensure ethical creation, as in the case of Fairtrade International whose mission is to connect disadvantaged producers and consumers, promote fairer trading conditions and empower producers to combat poverty.
Reduce Costs
Sustainable procurement offers significant economic benefits, such as cost savings and reduced risks.
By adopting sustainable procurement practices, organizations can reduce their operational costs through increased efficiency, reduced waste and improved resource management.
These aspects can lead to a reduction in supply chain risks, such as disruptions due to resource scarcity or regulatory changes, leading to greater stability and resilience in the long run.
Additionally, sustainable procurement helps businesses to build their reputation and brand, which can lead to increased sales and improved customer loyalty thus curbing the associated risks.
Conclusions
In summary, sustainable procurement offers dual benefits for both the environment and the economy.
By factoring in the environmental impact of goods and services, organizations can mitigate their carbon footprint and support a more sustainable future.
In addition, sustainable procurement strategies can lead to reduced expenses, enhanced productivity and improved reputation, which can have a positive effect on profitability.
As society grows more aware of environmental concerns, sustainable procurement is gaining importance and companies that prioritize sustainability are likely to enjoy long-term success. Consequently, it is crucial for organizations to integrate sustainable procurement approaches into their operations and play a role in fostering a more sustainable future for all.
