What are the challenges to expect with sustainable procurement?

Difficultes achats responsables
August 3th, 2021
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According to a study carried out by the French organisation ObsAR (Observatoire des Achats Responsables — sustainable procurement observatory), in 2020, almost half of the companies involved (49%) regarded strengthening their sustainable procurement approach as a priority[1]. This commitment demonstrates the benefits that go hand in hand with a well-managed sustainable procurement policy.

Nevertheless, there are many significant challenges to actually implementing and consolidating a sustainable approach to procurement. The white paper[2], published jointly by the EcoVadis platform[3] and the Grenoble École de Management business school[4], includes a section on the kinds of pitfalls to expect when undertaking such an approach. The paper distinguishes between two types of obstacles:

The authors of the white paper interviewed the participating companies on the process of obtaining the "Relations Fournisseurs et Achats Responsables" (responsible supplier relations) label, which officially recognises and raises the profile of companies with the most successful approaches to sustainable procurement. The text below is based on their feedback.

Sustainable procurement: Obstacles every step of the way

Starting out: The difficulty understanding what's required

The sustainable procurement label is associated with incredibly exacting standards. The first difficulty highlighted by participating companies is understanding what's required.

This becomes all the more complicated as the label changes over time. However, the consensus from businesses is that initial investment in the strategy behind a sustainable approach to procurement is key. Any changes to requirements are therefore part of this same logic: Companies that invest from the get-go have the means to adapt.

Progressing further: The strong need for human capital

When embarking on a sustainable approach to procurement, it's important to recognise that the journey will be long, arduous and time-consuming:

  • Four to six months to prepare for the initial audit and secure the label
  • One to two months to develop an action plan

One of the participants in the collective study estimates that, in total, investment in the first year is equivalent to 60 days per person. They also add that, even then, it still takes around ten days per person every year just to adapt the action plan to the real world. 

However, getting the right resources involved and harnessing their full potential is also crucial. There are four key elements in particular that are essential when it comes to gearing an entire organisation towards sustainable procurement:

  • Support at the highest level
  • Effective management of the approach
  • Strong, continued awareness among buyers
  • Regular communication with suppliers

In particular, developing the procurement team's skills is an ongoing challenge to ensure practices keep on improving.

Continuing in the long term: A real paradigm shift

Companies adopting a sustainable approach to procurement must also recognise the magnitude of the changes that need to be implemented. This is especially important for those looking to acquire the label, which by all accounts is incredibly demanding.

While the rigorous nature of the requirements makes securing the label even more worthwhile, it also runs the risk of discouraging companies. That's why maintaining a steady rate of progress in the long term is especially difficult for companies of all sizes.

Finally, all the companies involved acknowledge the difficulty of developing new indicators tailored to the challenges posed by sustainable procurement. The challenge lies in sharing the reasoning behind the overall costs with all of the stakeholders.

Sustainable procurement: Obstacles specific to companies of certain sizes

The challenge for SMEs: Making ideas a reality

Obtaining the responsible supplier relations label rests on an audit that all organisations have to undergo. Even for companies that don't want to acquire the label but simply wish to make a firm commitment to sustainable procurement, the preliminary audit is a necessary step.

However, for Small- and Medium-sized Enterprises (SMEs), and in certain atypical areas such as IT services, actually incorporating sustainable procurement criteria can prove difficult.

To action: Seek guidance from a firm familiar with the world of SMEs.

The challenge for MSEs: Benchmarking

Medium-Sized Enterprises (MSEs) are few and far between. According to INSEE, there are just 5500 spread across the whole of France.

This makes it difficult for MSEs to compare performance, and opportunities to draw on the experience of other people in similar-sized companies facing comparable challenges are scarce.

To action: Join a club for MSEs in your area and/or the CSR commission.

The challenge for large businesses: Implementation across the organisation

The fragmented nature of the entities within a large business and their lengthy chains of command often lead to sustainable procurement policy being unevenly, and in some instances, poorly implemented across different units and regions.

To action: Strengthen support for the change by introducing a dedicated team of ambassadors, for example, to ensure communication is clear and consistent throughout the entire organisation.

The challenge for public companies: Adopting the approach

For a number of public companies that still possess a silo mentality, the road ahead in terms of securing the responsible supplier relations label is even longer and less straightforward.

Nevertheless, many public organisations have taken up the challenge and are now proving on a day-to-day basis that a sustainable approach to procurement is in fact achievable.

To action: Choose a firm familiar with the world of public organisations to assist you.

In conclusion, taking into account the amount of time and energy required to prepare for and wholly commit to a strategy is key to ensuring a genuinely sustainable approach to procurement. To secure the label, which is awarded to the top companies, a sustainable approach to procurement must be implemented consistently across the board and there must be genuinely effective changes in practices. That's why strong, long-term commitment is essential.

Sustainable procurement can't be achieved without responsible suppliers. To find out how to enrich your supplier portfolio, take a look at this article by Pierre-Olivier Brial, Managing Director of the Manutan Group: CSR objective: How do you build a network of responsible suppliers?

[1] Baromètre ObsAR 2020 (ObsAR study 2020) — 2020 

[2] De la Charte au Label "Relations Fournisseurs et Achats Responsables": une démarche de progrès créatrice de valeur (From the "Responsible supplier relations" charter to the label: An improvement process that adds value) — Written and coordinated by Hugues Poissonnier

[3] https://ecovadis.com/

[4] https://en.grenoble-em.com/