Corporate Social Responsibility (CSR) has become a major issue for economic players in all sectors. For companies, this approach involves integrating sustainable development principles into their activities and relationships with stakeholders. Beyond being economically viable, this implies having a positive impact on society and preserving the environment. Since this approach extends throughout the value chain, every company must also evaluate its suppliers for their CSR performance.
Evaluating suppliers is essential
Once a company has defined its own CSR requirements, it must involve its partners in this dynamic. This requires commitment from suppliers, as well as regular evaluations of their CSR performance. This collaborative customer/supplier approach is primarily part of a continuous improvement process. It is necessary to establish a factual measurement system, which paves the way for the setting up of adequate action plans.
To carry out these supplier evaluations, several types of tools are available:
- Questionnaires allow for the collection of large amounts of data;
- On-site audits help to examine the data previously gathered;
- Standards (such as ISO 26000 and ISO 20400) represent international requirements;
- Online platforms enable the standardisation and pooling of these processes.
One thing is certain: This approach must be data-driven. It is up to each company to choose the most effective evaluation process to suit its needs, resources and maturity in this area. This helps to ensure that the supply chain is both reliable and stable, identifying potential risks and improving suppliers’ overall performance.
According to the latest EcoVadis barometer, 69% of buyers take into account ethical business practices as well as social and environmental performances when selecting new suppliers and renewing contracts (18 points higher than two years ago). This demonstrates the importance supplier evaluation will have in the coming years!
Three main categories of supplier evaluation criteria
To evaluate suppliers, the procurement function must rely on three categories of CSR criteria, namely environmental, social and governance aspects, to assess their performance.
Environmental criteria
Environmental criteria allow for the assessment of the overall environmental management of a company’s activities.
This covers various themes:
- Management and training systems: Environmental management system, certification…
- Greenhouse gas (GHG) emissions: Reporting of GHG emissions, strategy to fight climate change…
- Energy consumption: Energy audit, monitoring of consumption…
- Atmospheric emissions: Regular testing of atmospheric emissions…
- Water management: Management and monitoring of water withdrawals and consumption…
- Waste management: Reduction of pollution and waste, management of hazardous waste…
- Packaging: Reduction targets, reuse, and recycling of packaging used for products…
- Pollution prevention: System for prevention and management of hazardous substances, Design for Environment approach taken into consideration during product development…
- Raw materials: Inventories of chemical substances, identification of responsible management…
- Transport: Objectives and programmes to reduce overall impacts…
Social criteria
Social criteria aim to ensure safe, fair, and decent working conditions for all employees regardless of their industry.
This includes:
- Workplace management: Policy defining the approach to labour, health and safety standards, management system for risk assessment…
- Health and safety: Control of noise levels and air quality, emergency response plan…
- Discrimination: Procedures ensuring equal pay for equal work, policies on hiring practices, employee benefits…
- Freedom of association and collective bargaining: Freedom to join or form trade unions, recognition of these unions…
- Harassment and ill-treatment: Harassment prevention policy, procedures for reporting such situations confidentially…
- Remuneration: Application of the legal minimum wage, social benefits, holidays and legal leave…
- Working hours: Communication on laws regulating working hours, one day off guaranteed per week…
Governance criteria
Governance criteria ensure that a company has put in place an adequate organisation to make decisions and implement them with the aim of achieving its objectives.
These include:
- Accountability: Presence of a CSR and/or quality policy, auditing various management systems…
- Grievances and corrective measures: Procedures for reporting environmental and social violations or concerns, resolving any complaints…
- Supplier management: Procedure to ensure legal and regulatory compliance, as well as to assess and manage supplier risks…
- Stakeholder involvement: Identification of stakeholders involved in sustainability strategies, publishing of these results…
- Disclosure: Publishing of environmental, social and governance (ESG) policies, programmes and performance, considering supplier performance on key ESG indicators in purchasing decisions…
Within each company, supplier evaluation is the essential condition for upholding its commitments to sustainable development. Whether through a platform, audit, or CSR questionnaire, this process remains synonymous with profitability, competitiveness, and long-term viability for the entire ecosystem. The players who will make a difference in the long run are those who respect environmental and ethical principles, but also those who anticipate laws and regulations, favouring a more responsible and sustainable future for all.
