Greening the supply chain

Making sustainable procurement a reality

Why is sustainable procurement an important issue for companies?

Sustainable procurement is an essential element in greening the supply chain and plays a vital role in helping achieve measurable business sustainability.

Operating a successful business rarely happens in isolation of relying on other companies to provide materials, components, services and expertise. Managing the supply chain in favour of sustainable outcomes can be a challenge, however implementing some straightforward actions can help to deliver quality products and services that are environmentally improved.

Sustainable procurement is a practical approach that uses your buying power to encourage, stimulate and deliver improved environmental outcomes from each and every supplier and/or service provider you deal with.

In simple terms sustainable procurement is about buying goods and services in a way that is responsive to social, economic and environmental factors. This means taking into account:

• value for money i.e. quality, fitness for purpose, whole-of-life costs, maintenance;
• environmental performance that is life-cycle based, quantifiable and preferably certified; and
• social aspects such as the impact of labour conditions, child labour, child labour, occupational, health and safety concerns, as well as compliance with all relevant regulatory requirements.

Developing an open relationship with all your suppliers, contractors and service providers is an essential aspect of any sustainable procurement process and demands that all players in the supply chain are aware of their environmental performance and obligations.

What are the design-related benefits?

Sustainable procurement can be a powerful tool when it comes to stimulating increased EcoDesign activity.

By adopting widely accepted EcoDesign principles and requiring suppliers and service providers to comply, there is an unmatched opportunity to drive environmentally oriented product and service redesign. This type of approach not only delivers ‘greener’ products and services, it also builds capacity among your suppliers and translates into a competitive edge that can be used to secure business with other clients and customers.

In particular:

• The procurement of manufactured goods should directly involve EcoDesign considerations.
• Good design based on accepted EcoDesign principles and life-cycle thinking should be at the core of your sustainable procurement approach.
• Source products and services that feature genuine environmental performance improvements i.e. measurable and tangible environmental benefits.
• Use environmental performance and sustainability to comparing competing products and/or services.
• Sustainable procurement is a highly efficient and effective way of sharing responsibilities among all those benefiting from the production and consumption of goods and services.

What can you do to maximise the environmental performance of your procurement activities?

• Develop a sustainable procurement policy or checklist based on accepted ‘green buying’ principles or guidelines. Checklists and guidelines can be found at environmental procurement related web sites administered by EcoBuy: www.ecobuy.org.au and the Queensland Government: www.qgm.qld.gov.au
• Compare products and services based on a life-cycle or cradle to grave approach i.e. where relevant consider the source of raw materials, manufacturing, packaging and distribution, operation and maintenance, potential for repair, reuse and recycling, as well as ultimate disposal of the product.
• Utilise existing third party labelling schemes and programs to help you make comparisons and decisions, especially in relation energy and water using appliances and products. Reputable labelling programs also exist in relation to organics, textiles and products using timber (eg. Forest Stewardship Council certified). The presence of certified labels such as Good Environmental Choice Australia and other similar labelling programs can be useful when making purchasing decisions depending on the product category.
• Make sure that all your staff involved in purchasing and procurement are aware of the company’s sustainable procurement policy, plan or checklist, and ensure that its proactive application is supported at the highest level.
• Get to know your suppliers and ensure they know about your sustainable procurement plan early in the process. Secure their engagement early in the process to avoid defensive attitudes. Be sensitive to the impact your policy or new procurement procedures might have on their business. In some cases you can drive a positive process of environmental improvement and redesign with your suppliers.
• Establish which products or services are likely to have the most significant environment and/or social impact and focus your sustainable procurement plan on those.
• Consider the profile and reputation of your suppliers as part of the process. Ask them specific questions about their compliance with all relevant environmental regulations. Try to get a sense of whether they are a low, medium or high-risk supplier in terms of sustainability performance.
• Be as specific as you can when asking suppliers questions without making the process unnecessarily onerous. Focus on products and service by individual category. For example, ask specific questions related to energy using products, water-using products, packaging requirements etc.
• Always ask suppliers for written verification or documentation, which supports their environmental claims. Preferably ask for third-party certified verification.
• Some noteworthy indicators of whether suppliers are environmentally oriented and taking into account sustainability factors include involvement in some of the following schemes and programs:
  • the supplier has an Environmental Management System certified to ISO14001
  • the supplier’s products are listed on EcoSpecifier.org
  • the supplier’s products are listed on EcoBuy
  • the supplier’s products hold the Good Environmental Choice Australia label
  • the supplier’s products or the company is certified ‘Greenhouse Friendly’ by the Commonwealth Government
  • the supplier is a signatory/member of the Victoria WasteWise program.

Who else can assist with knowledge, advice and support?

ECO-Buy

ECO-Buy is an award winning not for profit company that supports organisations in purchasing environmentally preferable products and operates as a Centre of Excellence in environmental purchasing. ECO-Buy exists to help you 'green' your purchasing and integrate sustainable purchasing practices and attitudes within your organisation.
www.ecobuy.org.au

Australian Green Procurement

A valuable source of information on numerous aspects of sustainable procurement as it relates to Australia. Developed as an initiative of the Good Environmental Choice Program.
www.geca.org.au

EcoSpecifier

EcoSpecifier is an excellent information resource for those companies sourcing manufactured products for building and construction projects. Numerous product categories cover commercially available European Commission-products available in Australia, from textiles and paints through to flooring, carpet and office equipment.
www.ecospecifier.org

Buy Green – Sustainable Procurement Program

An excellent website developed and regularly updated by the Queensland Government. Features a diverse and comprehensive range of information, resources and checklists to support sustainable procurement activities.
www.qgm.qld.gov.au

Green Goods – Sustainable Purchasing Program

A useful website with information about sustainable procurement and environmental purchasing with a policy and planning focus. Administered by the NSW Government.
www.greengoods.nsw.gov.au

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