Sustainable Procurement: Key Takeaways from Procurement Climate Council 2024

The recent Procurement Climate Council, hosted at the Sourcing Champions office and sponsored by Ivalua, EcoVadis and Sphera, brought together industry leaders and experts to discuss sustainable procurement. The agenda covered essential topics, offering valuable insights and practical steps for advancing sustainability in procurement practices. Read along to discover the key points from the council, highlighting how businesses can implement sustainable procurement effectively.

Embracing Just Transformation in Procurement

Prof. Dr. Joyeeta Gupta, a distinguished professor of environment, opened the council by emphasizing the urgent need to leave fossil fuels underground. Her session highlighted the importance of a just transformation, requiring changes in demand-side management and production and consumption patterns. Companies must address not only Scope 1 and 2 emissions but also Scope 3 emissions, involving the entire value chain. This comprehensive approach ensures true zero emissions, rather than merely achieving net zero.

Advancing Sustainable Sourcing: Insights from PayPal

Sam Kaserer, Global Sourcing Manager at PayPal discussed the progress made since the first Procurement Climate Council in 2023. His presentation on sustainable sourcing strategies included integrating sustainability questions into RFP templates and accelerating the education of category managers and internal stakeholders. A crucial part of this strategy is identifying a sustainability champion to drive these goals. This approach shifts the focus from cost-centric to risk mitigation and aligns C-level sustainability goals with purchasing decisions.

Market Study: Procurement’s Role in Achieving Net Zero

Sabrina Hueren from Sourcing Champions presented a market study on procurement’s role in achieving net zero. She underscored the urgency of addressing climate change, noting that the CO2 budget will run out in five years to keep global warming under 1.5 degrees. Despite sustainability being a top priority, nearly half of the companies lack a specific commitment to net zero. Key insights included decreased confidence in net zero performance, the dominance of price in supplier selection, and low levels of digitalization in sustainable procurement. Regulatory considerations are emerging as a mechanism to ensure serious sustainability commitments from companies.

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Sustainable Procurement Barometer: Challenges and Opportunities

Senne Vanderstraeten from EcoVadis provided insights from the Sustainable Procurement Barometer 2024. He highlighted key challenges and opportunities for Chief Procurement Officers to achieve their organization’s sustainability goals. Key learnings included engaging C-suite stakeholders, integrating supplier sustainability data, and broadening the focus beyond decarbonization. Enhancing N-tier visibility, building core sustainability skills, and fostering supplier engagement are also critical. The Carbon Action Report emphasized the need for scalable supplier engagement to decarbonize global supply chains.

Systemic Change for Sustainable Procurement

Lucas Simons, founder of NewForesight offered a comprehensive overview of systemic change in his keynote address. He highlighted key strategies for driving transformation and sustainable procurement. By aligning incentives across stakeholders, businesses can create long-term value. This approach not only helps achieve sustainability goals but also enhances resilience and competitiveness in a rapidly evolving market.

Practical Approaches to Implementing System Changes

Alexander Heijkamp, owner of ESG-Consultancy B.V. led an interactive workshop on implementing system changes. Participants collaborated on real-world challenges, gaining hands-on experience and valuable feedback on their strategies. This practical approach is crucial for businesses looking to integrate sustainable practices effectively.

Technology’s Role in Enhancing Sustainable Procurement

The tech talks and solution demos by Maximilian Rasche from Ivalua, Senne Vanderstraeten from EcoVadis, and Alex Gershenson from Sphera showcased innovative technologies. These sessions explored tools that enhance sustainability efforts and compliance in procurement. The use of technology is vital in tracking and managing sustainable procurement initiatives.

Leadership in Sustainable Procurement: DHL’s Approach

Erik-Jan Ossewaarde, Senior Vice President Global Sourcing at DHL provided inspiring insights into sustainable procurement leadership. He shared practical examples of how DHL drives sustainability initiatives within the Logistics and Transportation industry. Leadership plays a crucial role in advancing sustainability goals and motivating teams to embrace sustainable practices.

Navigating Sustainable Compliance

Beata Wandachowicz-Krason, Director Third Party Risk, Compliance & ESG at Organon led a workshop on sustainable compliance. She offered in-depth knowledge on regulatory frameworks and best practices. Her session provided insights into the Organon Sustainable Roadmap and how compliance improvements can go hand-in-hand with sustainability efforts.

Conclusion: The Path Forward for Sustainable Procurement

In conclusion, the Procurement Climate Council 2024 underscored that sustainable procurement is essential for businesses aiming to remain competitive and responsible. By adopting just transformation principles, integrating sustainability into sourcing strategies, and leveraging technology, companies can make significant strides. Engaging stakeholders, enhancing transparency, and building core sustainability skills are essential steps in this journey. As demonstrated by industry leaders, the path forward involves collaboration, innovation, and a commitment to true zero emissions. Sustainable procurement consulting and consultancy services can provide the necessary support to navigate these changes, ensuring that businesses not only meet but exceed their sustainability goals.

Final Thoughts

Sustainable procurement requires a concerted effort from all levels of an organization. By addressing Scope 3 emissions, embracing systemic changes, and leveraging technology, businesses can drive meaningful change. The examples and insights from the Procurement Climate Council 2024 provide a roadmap for others to follow. As we continue to face environmental challenges, sustainable procurement will remain a cornerstone of responsible and successful business practices.

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