SUSTAINABILTY
“ We often think of this as being the carrot versus the stick mentality , so that instead of tailoring suppliers to your needs , it is more beneficial to tailor your approach to them , to encourage progress towards sustainability goals .
“ Seeking ‘ customer of choice ’ status with strategically important suppliers on sustainability goes a long way to ensuring this engagement . This entitles the buying organisation to better engagement , priority access to capacity in times of scarcity , and first-in-line access to supplier innovation .
“ But customer of choice status isn ’ t achieved overnight . You have to demonstrate that you ’ ll take positive , mutually beneficial action with these supplier stakeholders , and that you will guard their interests besides your own .”
Large businesses are , of course , forever onboarding new suppliers , and McClintock says that this is why it ’ s important that new suppliers are made aware of sustainability-related expectations during initial engagements .
He says : “ The procurement organisation must integrate sustainability performance into the sourcing process . They need weighted request for proposal ( RFP ) criteria and supplier relations management ( SRM ) touchpoints .
“ Procurement teams should set minimum eligibility conditions so that prospective suppliers can provide some indicator of their engagement in sustainability .”
Monitor and nurture supplier sustainability performance McClintock says that , beyond the initial screening process , setting expectations and ongoing monitoring are both important if companies are to “ engage suppliers in a continuous improvement journey ”.
“LONG-TERM RELATIONSHIPS WITH SUPPLIERS WHO ARE COMMITTED TO PROGRESSING ON THE JOURNEY IS A RELIABLE PATH ”
DAVID MCCLINTOCK MARKETING DIRECTOR , ECOVADIS
He adds : “ No supplier – or buyer , for that matter – is perfect on any sustainability topic . Discontinuing a supplier with a low sustainability score and onboarding a new supplier is expensive , and should be an exception .
“ Long-term relationships with suppliers who are committed to progressing on the journey is a more reliable path – even if they don ’ t have exceptional performance or scores at the beginning .”
98 June 2022