To contribute to corporate social responsibility, procurement departments have a key role to play in selecting their suppliers. As part of their sustainable procurement policy, these departments are planning to build a network of suppliers that demonstrate environmental, social and corporate responsibility, in line with their values and commitments. There are two steps to achieving this: establishing some prerequisites and evaluating suppliers.
Defining your CSR criteria
First and foremost, procurement departments must define what they mean by "responsible supplier". To do this, they'll need to first identify and then prioritise and assign weightings to the CSR criteria that will guide them in choosing their suppliers. These can then be included in the contractual specifications at subsequent consultations.
There are several items to cover:
- The environment: pollution prevention, sustainable use of resources etc.
- Human rights: duty of care, discrimination etc.
- Labour relations and working conditions: health and safety at work, social dialogue etc.
- Fair practices: corruption, fair competition etc.
- Consumer issues: fair marketing practices, data protection etc.
- Corporate citizenship: creation of jobs, development of technology etc.
Some large companies also formalise these requirements by drafting their own responsible procurement charter or code of conduct concerning their suppliers and subcontractors. These documents provide a reference framework that sets out the social, environmental and corporate commitments required from partners, as well as the commitments that the company will make to them.
Companies don't necessarily have to create their own charters, and may decide instead to follow a different one. As such, the Charte Relations Fournisseurs et Achats Responsables (charter for responsible supplier relations) is becoming increasingly popular in France, with more than 2000 signatories to date. These documents represent a first step towards the implementation of a sustainable procurement policy.
After putting everything in writing and obtaining a commitment from their partners, procurement departments should then make sure that the latter are meeting the agreed requirements. To assess their suppliers' CSR performance, procurement departments have several tools at their disposal:
- Questionnaires and audits
Large companies often use questionnaires to collect a large amount of data. This step also helps pinpoint who to audit. A useful addition to the questionnaire, audits help to expand on the information collected by means of an on-site survey.
There are various international standards that may be useful, even if they don't result in certification. To start with, there is the ISO 26000 standard, which is the first international standard on social responsibility. Published in 2010, it aims to help organisations think strategically in order to deploy ambitious CSR policies.
More recently, the ISO 20400 standard on sustainable procurement has been published as an extension of ISO 26000. It provides guidance on integrating the concept of corporate social responsibility into procurement processes.
- Online platforms
EcoVadis, SEDEX (Supplier Ethical Data Exchange) and Acesia are online platforms that allow companies to choose their partners on the basis of assessments. Suppliers are evaluated once, on internationally recognised CSR criteria.
Following these assessments, procurement departments must then support their suppliers in an improvement process and identify any corrective actions. The idea is to ensure that the relationship with these suppliers is sustainable.
Finally, building a network of responsible suppliers will promote collaboration between procurement departments and their partners, thereby strengthening the relationship in the long term. This echoes Henry Ford's view that "Coming together is the beginning. Keeping together is progress. Working together is success".