Sustainable procurement is how organizations seek to improve the environmental impact of their purchases by operating in ways that positively affect society’s economic, social, and environmental development. Responsible purchasing can include finding suppliers who are fair trade or environmentally friendly, using recycled production or packaging materials, or eliminating waste throughout the supply chain. Procurement officers influence the supply chain through their purchasing decisions; therefore, they often play a major role in impacting their organizations’ sustainability goals.
Procurement within the public sector is uniquely positioned to lead this effort. In the United States, procurement accounts for $1.8 trillion of federal spend per year, or over 9% of the US GDP. Because procurement plays such a large role in federal spending, many public entities, including schools, have specific Environmental, Social, and Governance (ESG) goals. Additionally, organizations such as the Association for the Advancement of Sustainability in Higher Education (AASHE) provide standards for universities to measure and rate their sustainability efforts.
But while many institutions have documented social responsibility initiatives, they often find it difficult to achieve their goals, since identifying certified sustainable products has traditionally been a manual and time-consuming process. According to a Gartner poll, 55% of procurement leaders say they lack specific strategic purchasing requirements.
So where should you begin? To bring sustainability to the forefront of your procurement strategy, start by understanding your current ESG footprint and set specific targets against this baseline. Amazon Business Analytics can help you gain visibility into your organization’s purchase history and understand what percentage of purchases met these targets. You can also benchmark against peers in your tier or region.
“As a procurement leader at Penn State, I was thrilled to see we could use the Amazon Business Analytics credentials report to find a baseline for our Socially Responsibly Purchasing activity. I was able to quickly see how much we have been spending with diverse suppliers and also see how much we have spent with small businesses through Amazon Business. Enabling the buying policies to prefer all registered small businesses and diverse companies was quick, easy, and as a result over 16% of our Amazon Business spend went to these suppliers."
— Richard D. Elmore, Chief Procurement Officer, Penn State University
Once you’ve identified areas for improvement, define standard policies to help guide supplier selection, shipping, and ordering. According to McKinsey & Company, “including ‘sustainability as standard’ in procurement processes is an effective way to reduce ESG-related risks and spot opportunities for incremental improvements. It can also help to ensure that procurement teams and their internal customers are aware of the environmental and social impact of purchasing decisions."
Included with Business Prime, Guided Buying is an Amazon Business feature that can encourage more sustainable purchases by turning procurement policies into easy-to-follow visual signposts for buyers. With Climate Pledge Friendly products certified by over 150+ trusted third parties, it’s easy to identify and filter by sustainable options.
Finding a partner to help meet your ESG goals doesn’t have to be a challenge. Amazon Business combines procurement expertise with curated solutions to help organizations define, meet, and measure their social responsibility and sustainability goals. Contact us to learn more.
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