EcoVadis HEC Barometer - Sustainable Procurement integral to business
The importance of sustainable procurement (SP) continues to grow rapidly. No longer seen as a nice-to-have discipline, SP has evolved into an integral business function to reduce costs, mitigate business risk, protect and improve brand reputation, drive revenue, and support innovation and growth.
Fortune 500 organizations across the globe are investing heavily to ensure sustainability is ingrained across all aspects of their supply chain and procurement operations. The challenge – especially for chief procurement officers (CPO) and chief
sustainability officers (CSO) - is to ensure the investment pays off and has the desired impact across the supply chain in accordance with CEOs’ and top managers’ expectations.
The HEC/EcoVadis Sustainable Procurement Barometer measures the evolution of SP practices in global procurement organizations and aims to provide an understanding of the SP landscape, including sector and geographical differences, industry strengths, improvement areas, new frontiers for innovation, and the potential levers for success in the future.
The last Barometer, published in 2013 and titled “Time To Measure Value Creation”, found global organizations struggling to harness the attention and support of top management and lacking solid footing around performance metrics and objective setting. In this year’s report
we see a theme of ‘scaling up’ emerging for established programs as we find organizations are at a critical juncture for SP growth. Covering ‘strategic’ or ‘large spend’ suppliers is simply not enough. Disasters like Tianjin and Rana Plaza are reminders that significant risks remain unaddressed in most global supply chains. There is immense scope of work to be done to cover the ‘long tail’ of risk areas representing significant risks. The more mature SP programs are seeking the right strategies and investments needed to scale up their programs to include breadth and depth of coverage of their supply base. For the first time in the HEC/EcoVadis Sustainable Procurement Barometer, an additional survey was also conducted with suppliers to gather data and insights from their perspective. Findings from this survey suggest that not only increased engagement, but also better internal alignment with suppliers will be critical to develop strategic partners to innovate on sustainability and beyond. In the coming years, sustainability in procurement will need to rapidly evolve into a new phase of maturity in order to meet the growing demands of stakeholders and executive management, and moreover to align with the ambitions of the UN COP21 Paris Agreement.