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Trend or Philosophy ?
SUSTAINABLE PROCUREMENT
CONTENT
• Sustainability & Procurement : How they are related and how they are linked
• Sustainable Procurement : Whom it concerns and Who is affected ?
• Beyond the theory : Sustainable Procurement in Practice
• Internal & External Effects
• Business Ethics
• Financial Impact
• Where does the Sustainable Procurement path lead us ? Should we follow ?
SUSTAINABILITY & PROCUREMENT :
HOW ARE THEY RELATED
Sustainability
4 Dimensions
Social
Environment
Economic
Culture
• Social
• Human & Labor rights (Equal opportunities
• Healthy & safe working environments)
• Social Environment : Peace, Security, Justice, Poverty, Education
• Sustainable Living (Social Movements like New Urbanism, Eco-Municipalities: sustainable
cities, reduce environmental impact)
• Economic
• Create economic growth (local/global) without negative environmental impacts
• Raise standard of living without endangering environmental resources
• Environmental - Protect the ecosystem and manage the human consumption of resources
• Minimize waste (recycling, composting or energy recovery, etc.)
• Limit pollution to protect natural systems
• Protect the diversity of nature
• Cultural
• Protect national and global cultural heritage
• Support customs and traditions
• Support the culture diversities
• Respect cultural changes
• Technology
Sustainable
SUSTAINABILITY & PROCUREMENT :
HOW ARE THEY RELATED
Procurement
Identify
need
Purchase
Requisition
Approval
Purchase
Order
Goods /
Service
Receipt
Invoice
match /
Payment
Requirement
Definition
Category
analysis /
strategy
Supplier
Identification
RFI/RFQ
Negotiate
Contract
Manage
Contract
Supplier
Management
PurchasingSourcing
SUSTAINABILITY & PROCUREMENT :
HOW ARE THEY ARE RELATED
Requirement
Definition
Category
analysis /
strategy
Supplier
Identification
RFI/RFQ
Negotiate
Contract
Manage
Contract
Supplier
Management
Social
Environment
Economic
Culture
Sustainable Procurement
Sourcing
How are we sourcing?
• According to the newly issued ISO 20400 the definition for the Sustainable Procurement
is:
• “Procurement that has the most positive environmental, social, economic (and cultural)
impacts possible over the entire life cycle*”
(*from natural resources to final disposal)
SUSTAINABLE PROCUREMENT
Source : ISO (the International Organisation for Standardisation, www.iso.org
• INTERNALLY
• Procurement Departments ?
• W/H & Logistics ?
• Finance ?
• HR ?
• Marketing ?
• IT ?
• Sales ?
• Health & Safety ?
• EXTERNALLY
• Customers ?
• Suppliers ?
• Local Community ?
• Country ?
• Society ?
SUSTAINABLE PROCUREMENT –
WHOM IT CONCERNS ? WHO IS AFFECTED ?
To whom it may concern… Who is/are affected ?
• Companies
• Governments
• Society
• Internal & External Effects
• Business Ethics
• Financial Impact
BEYOND THE THEORY :
SUSTAINABLE PROCUREMENT IN PRACTICE
• Changes in the Supply Chain
Dynamics
• Benefit to Local Population
• Health Benefit
• Improved Market/Product
• Increase Clean Energy
• Job Training
• Reduction of Waste
• Change Management
• Education
• New Partnership
• New Product
• New Service
• New Use of Business
• New Use of Product
• Production Process
INTERNAL & EXTERNAL EFFECTS
Internal Effects External Effects
• Actions that are good and legal but not
a legal obligation
• Actions that are bad, and illegal
• Actions that are legal, but bad
• Actions that are good, but illegal
• Social Development and Caring
• Social Responsibility and supporting
• Reciprocity and fair play
• Fairness
• Lying
• Cheating
• Bullying
• Harming
BUSINESS ETHICS
Ethics
The good life
Doing good
Morality
Justice
Avoiding doing harm
Corporate Citizenship Equity Honesty Avoiding doing harm
Social
Development
and caring
Social
Responsibility
and supporting
Reciprocity
and fair play
Fairness Truthfulness Cheating
and
selfishness
Bullying and
social
irresponsibility
Harming and
social
disengagement
Source : Business Ethics & Sustainability, Conrad Lashley, 2016
FINANCIAL IMPACT
• Is Sustainable Procurement (more) expensive ?
• Case study : United Utilities delivered financial savings in excess of 6M by following
a 3 year sustainable procurement programme based on BS 8903, improved
procurement staff awareness by 100% , leading to improved retention and achieved
global leadership status in the Dow Jones Sustainability Index, improving
shareholder confidence.
• *Sustainability should not cost more; bad procurement does. The right procurement
techniques will deliver value for money
Sources: IEMA – www.iema.net / Action Sustainability www.actionsustainability.com / ISO 20400 www.iso20400.org
• The trap is to follow a path with ‘Individual Sustainable Procurement ‘versions’….
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
S.P v.2
S.P v.1
S.P v.4 S.P v.3
S.P v.5
S.P v.6
S.P v.∞
S.P v.358
S.P v.589
S.P v.68
S.P v.987
S.P v.105
S.P v.7
• The trap is to use Sustainable Procurement to close ‘borders’ and minds… and lose :
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
Growth
Science
Technology
Communication
Environment
Culture
Wealth
• Would we ever buy from this factory ?
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
If it is Sustainable (not to buy), is it Ethical… ?
If it is Sustainable (not to buy), is it Ethical… ?
If it is Sustainable (not to buy), is it Ethical… ?
• Should we turn them our back…?
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
• Should we turn them our back…?
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
• Should we turn them our back…?
WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ?
SHOULD WE FOLLOW ?
2017 : 45.000.000 slaves……
THE SINGLE PATH TO SUSTAINABLE PROCUREMENT
• Standardization – ISO 20400 (very similar to BS8903)
• Compliance to Legislation – Modern Act 2015, Waste, Recycle, etc.
• Re-write specs integrating sustainable parameters
• Engage internal and external stakeholders
• Support Change Management
• Training
• Measurement – KPI’s (deemed by an accredited organization)
• Individual and Corporate Responsibility and Sensitivity
• Senior Management Commitment
• Persistence
Irini Etimou
e: irinietimou@gmail.com
m: 074693 11226
Thank you for your time and participation !

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Irini Etimou, Director of Procurement - Dams Furniture Ltd

  • 1. Trend or Philosophy ? SUSTAINABLE PROCUREMENT
  • 2. CONTENT • Sustainability & Procurement : How they are related and how they are linked • Sustainable Procurement : Whom it concerns and Who is affected ? • Beyond the theory : Sustainable Procurement in Practice • Internal & External Effects • Business Ethics • Financial Impact • Where does the Sustainable Procurement path lead us ? Should we follow ?
  • 3. SUSTAINABILITY & PROCUREMENT : HOW ARE THEY RELATED Sustainability 4 Dimensions Social Environment Economic Culture • Social • Human & Labor rights (Equal opportunities • Healthy & safe working environments) • Social Environment : Peace, Security, Justice, Poverty, Education • Sustainable Living (Social Movements like New Urbanism, Eco-Municipalities: sustainable cities, reduce environmental impact) • Economic • Create economic growth (local/global) without negative environmental impacts • Raise standard of living without endangering environmental resources • Environmental - Protect the ecosystem and manage the human consumption of resources • Minimize waste (recycling, composting or energy recovery, etc.) • Limit pollution to protect natural systems • Protect the diversity of nature • Cultural • Protect national and global cultural heritage • Support customs and traditions • Support the culture diversities • Respect cultural changes • Technology Sustainable
  • 4. SUSTAINABILITY & PROCUREMENT : HOW ARE THEY RELATED Procurement Identify need Purchase Requisition Approval Purchase Order Goods / Service Receipt Invoice match / Payment Requirement Definition Category analysis / strategy Supplier Identification RFI/RFQ Negotiate Contract Manage Contract Supplier Management PurchasingSourcing
  • 5. SUSTAINABILITY & PROCUREMENT : HOW ARE THEY ARE RELATED Requirement Definition Category analysis / strategy Supplier Identification RFI/RFQ Negotiate Contract Manage Contract Supplier Management Social Environment Economic Culture Sustainable Procurement Sourcing How are we sourcing?
  • 6. • According to the newly issued ISO 20400 the definition for the Sustainable Procurement is: • “Procurement that has the most positive environmental, social, economic (and cultural) impacts possible over the entire life cycle*” (*from natural resources to final disposal) SUSTAINABLE PROCUREMENT Source : ISO (the International Organisation for Standardisation, www.iso.org
  • 7. • INTERNALLY • Procurement Departments ? • W/H & Logistics ? • Finance ? • HR ? • Marketing ? • IT ? • Sales ? • Health & Safety ? • EXTERNALLY • Customers ? • Suppliers ? • Local Community ? • Country ? • Society ? SUSTAINABLE PROCUREMENT – WHOM IT CONCERNS ? WHO IS AFFECTED ? To whom it may concern… Who is/are affected ? • Companies • Governments • Society
  • 8. • Internal & External Effects • Business Ethics • Financial Impact BEYOND THE THEORY : SUSTAINABLE PROCUREMENT IN PRACTICE
  • 9. • Changes in the Supply Chain Dynamics • Benefit to Local Population • Health Benefit • Improved Market/Product • Increase Clean Energy • Job Training • Reduction of Waste • Change Management • Education • New Partnership • New Product • New Service • New Use of Business • New Use of Product • Production Process INTERNAL & EXTERNAL EFFECTS Internal Effects External Effects
  • 10. • Actions that are good and legal but not a legal obligation • Actions that are bad, and illegal • Actions that are legal, but bad • Actions that are good, but illegal • Social Development and Caring • Social Responsibility and supporting • Reciprocity and fair play • Fairness • Lying • Cheating • Bullying • Harming BUSINESS ETHICS Ethics The good life Doing good Morality Justice Avoiding doing harm Corporate Citizenship Equity Honesty Avoiding doing harm Social Development and caring Social Responsibility and supporting Reciprocity and fair play Fairness Truthfulness Cheating and selfishness Bullying and social irresponsibility Harming and social disengagement Source : Business Ethics & Sustainability, Conrad Lashley, 2016
  • 11. FINANCIAL IMPACT • Is Sustainable Procurement (more) expensive ? • Case study : United Utilities delivered financial savings in excess of 6M by following a 3 year sustainable procurement programme based on BS 8903, improved procurement staff awareness by 100% , leading to improved retention and achieved global leadership status in the Dow Jones Sustainability Index, improving shareholder confidence. • *Sustainability should not cost more; bad procurement does. The right procurement techniques will deliver value for money Sources: IEMA – www.iema.net / Action Sustainability www.actionsustainability.com / ISO 20400 www.iso20400.org
  • 12. • The trap is to follow a path with ‘Individual Sustainable Procurement ‘versions’…. WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ? S.P v.2 S.P v.1 S.P v.4 S.P v.3 S.P v.5 S.P v.6 S.P v.∞ S.P v.358 S.P v.589 S.P v.68 S.P v.987 S.P v.105 S.P v.7
  • 13. • The trap is to use Sustainable Procurement to close ‘borders’ and minds… and lose : WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ? Growth Science Technology Communication Environment Culture Wealth
  • 14. • Would we ever buy from this factory ? WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ?
  • 15. If it is Sustainable (not to buy), is it Ethical… ?
  • 16. If it is Sustainable (not to buy), is it Ethical… ?
  • 17. If it is Sustainable (not to buy), is it Ethical… ?
  • 18. • Should we turn them our back…? WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ?
  • 19. • Should we turn them our back…? WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ?
  • 20. • Should we turn them our back…? WHERE DOES THE SUSTAINABLE PROCUREMENT PATH LEAD US ? SHOULD WE FOLLOW ? 2017 : 45.000.000 slaves……
  • 21. THE SINGLE PATH TO SUSTAINABLE PROCUREMENT • Standardization – ISO 20400 (very similar to BS8903) • Compliance to Legislation – Modern Act 2015, Waste, Recycle, etc. • Re-write specs integrating sustainable parameters • Engage internal and external stakeholders • Support Change Management • Training • Measurement – KPI’s (deemed by an accredited organization) • Individual and Corporate Responsibility and Sensitivity • Senior Management Commitment • Persistence
  • 22. Irini Etimou e: irinietimou@gmail.com m: 074693 11226 Thank you for your time and participation !