The reality of CSR as told by chief procurement officers

CPO radio & RSE
May 4th, 2021
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Corporate social responsibility is a hot topic and a real talking point behind the CPO Radio.TV microphone. Chief procurement officers share their no-holds-barred views on this fascinating topic, which is actually still in its infancy in the world of procurement. That said, there are some amazing flagship projects underway, such as Lebronze alloys' upcycling initiative.

How CSR has become part of procurement

When advising customers on CSR, Frédéric Thielen, Director of Operations at KPMG and former Chief Procurement Officer at Saft and the Brandt Group, explains the need to build on common frames of reference and adapt an approach based on a company's business activities. He says, "Some people will be more focused on the environment, and now we're also hearing a lot about energy transition […]. Others from countries with slightly different backgrounds will ask more questions about the risk of corruption or child labour". He also highlights the need to unify this approach, because companies may use different benchmarks depending on their location, for example ISO, Global Compact, the French Charte des Relations Fournisseurs et Achats Responsables (charter for responsible supplier relations) etc.

Not surprisingly, CSR has become a real issue for all the chief procurement officers interviewed. For example, Roque Carmona, Senior Vice President and Group Chief Procurement Officer at Thales, talks about how his company put in place a strategy for a low-carbon future well before the health crisis hit. Under this strategy, the manufacturer of aerospace and defence and security equipment have set a goal: to cut its direct and indirect greenhouse-gas emissions by 40% and 15% respectively by 2030. To do this, buyers are now working on the procurement categories that produce the most emissions and integrating a variety of factors into their supplier evaluation and selection processes.

CSR is also making headway in the defence sector, boosted by the French energy transition plan for the armed forces. Stéphane Prud'homme, Chief Procurement Officer at Arquus, confirms that the carbon footprint is starting to feature in calls for tender. In addition, the French defence company—a market leader in land mobility solutions—is increasingly working on the manufacture of hybrid and hydrogen vehicles.

The Lebronze alloys model

Driven by strong CSR values, this specialist in the production of metal components has launched a flagship upcycling project. As the extractive industry produces a great deal of pollution, Christophe Tirard, Group Chief Procurement Officer at Lebronze alloys, started thinking about the company's purchase of raw materials, particularly copper, nickel, aluminium and zinc. Until that point, these materials were mostly new products that had been extracted to then be converted into alloys.

It was through visits to suppliers and recycling plants that Christophe Tirard started to wonder, "Why aren't we buying alloys straight from the recycling process"? In that moment, the company set itself a goal: to no longer buy new materials to make its alloys, but instead to transform products usually considered scrap into raw materials for its various foundries.

In addition to promoting green industry and the circular economy, this project offers a significant return on investment. Christophe Tirard adds, "It really is the innovation of the future. To keep industry in France, we need to find solutions, we must improve our margins and our profitability". In fact, that's actually the reason the France Relance recovery plan is going to subsidise this project.

As you can see, there are various levels of CSR integration in procurement, depending on the business sector of the company concerned. However, there isn't a single chief procurement officer out there who hasn't noticed a real rise in the importance of this topic, to the point where the issue will soon be unavoidable.