Green Procurement is defined as the integration of environmental considerations into purchasing policies, programs and actions. Green procurement, or green purchasing, is the involvement of the purchasing function in supply chain management activities, such as life cycle analysis (LCA) and environmental design that facilitates recycling, reuse and resource reduction.
This is an indispensable policy to implement successful sustainability strategies. That is why more and more organizations - starting with large corporations - are taking into consideration the ESG performance of their suppliers in reshaping their supply chains.
For SMEs knowing their own ESG ratings, as well as those of their partners, is essential to not lose important business opportunities. Synesgy platform offers an easy way to self-assess, certify ESG scores and compare suppliers’ ESG ratings.
How to develop a green procurement policy with Synesgy
Synesgy helps companies in the definition of their green procurement policies with a platform that enables them to assess the company's sustainability according to a holistic and in-depth approach.
An approach that returns clear, certified and intuitive results regarding a company's performance in five categories: Business, Environment, Social, Governance and Overall. These are all aspects that must be considered in the design of a green procurement policy.
For example, the largest impact of business-led activities in terms of emissions occurs along the supply chain. If we look at CO2 emissions, those belonging to Scope 3 (i.e., related to the supply chain) are generally much higher than both Scope 1 (emissions directly generated by a company) and Scope 2 (indirect emissions associated with the purchase of electricity or heating and cooling inputs) combined. But it is not just about emissions: a company can be strongly committed to the social front and, at the same time, be unaware that it is sourcing from suppliers who do not respect the rights of their workers.
Implementing a green procurement policy is therefore essential to prevent the company’s sustainability efforts from being wasted.
At the same time, let us remember that sustainability has also an economic dimension. For a company, therefore, assessing the sustainability of a supplier also means analyzing supply risk.
Why is important for SMEs to measure their ESG ratings
For SMEs it’s a double challenge, because poor performance in terms of ESG ratings can lead them to lose business opportunities, as:
- They damage their brand identity, as consumers are increasingly focused on sustainability.
- The new Corporate Sustainability Directive requires public SMEs to publish a sustainability report
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- Bigger companies are reshaping their supply chains by choosing only sustainable suppliers.
If getting good ESG ratings is essential to be included in bigger companies’ green procurement policies, for small companies analyzing ESG performances of all aspects of the business can be a tough process. Luckily, Synesgy has developed an easy and intuitive process that allows SMEs to win this challenge.
Green procurement policy, it starts with a self-assessment
Synesgy's intuitive dashboards, where companies' ESG performance is reported, are the result of a path of analysis that begins with a self-assessment questionnaire from the company.
The questionnaire is divided into two macro-sections: a more general one, referring to the Global Reporting Initiative (GRI) and focusing on the Business side and the Environment, Social, Governance principles, and another one that contains questions that aim to investigate the context in which the company operates, with industry-specific questions.
All Synesgy’s questionnaires are based on timely and rigorous references of global ESG market regulations such as UNGC, GRI, UN 17 SDGs, EBA LOM and EU Taxonomy for Sustainable Activities.
Certified data and ESG ratings with Synesgy digital platform
Alongside this international standards-based approach, Synesgy's success is determined by its commitment to certify the accuracy of the data.
The platform is equipped with an Alert system that, based on the CRIF information assets, performs an automatic check on the appropriateness and consistency of what is reported in the questionnaire. If the Alert system detects inconsistencies, Synesgy’s team of analysts check the documentation and, if needed, asks for supporting documentation to confirm the answers in the questionnaire.
At the end of the process, the company will be able to view the results through the digital platform, download the certificate of its ESG score and the action plan, with suggestions on critical areas of the business where action needs to be taken to improve the rating in order to assess green procurement policy.
Green procurement policy, how to choose the right suppliers
Synesgy allows companies to analyze how suppliers around the world gather on different ESG performance indicators, allowing them to reshape their supply chain to promote greater sustainability.
For SMEs to evaluate their own performance with an easy, certified and intuitive tool such as Synesgy's self-assessment is therefore essential in order not to miss important market opportunities. But not only that, because prioritizing sustainable practices with a green procurement policy is also essential to achieve consistent and long-lasting development.
