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Written by Marijn Overvest | Reviewed by Sjoerd Goedhart | Fact Checked by Ruud Emonds | Our editorial policy
Sustainable Procurement Business Examples — The Ultimate Guide
Key take-aways
- Sustainable procurement means actively integrating business practices into procurement processes.
- Companies like Panasonic, IKEA, IBM, Unilever, Nike, PepsiCo, Patagonia, and Adobe are setting examples by implementing sustainability in their supply chains.
- Sustainable procurement helps build a circular economy that lessens economic, social, and environmental impacts of purchasing goods and services.
Sustainable procurement is being adopted by many companies to reduce their carbon emissions and achieve sustainability. Of course, there are companies that have already adopted sustainability in their supply chain.
In this article, we will briefly discuss sustainability in procurement and its significance to businesses. Additionally, we will show you some companies that have embraced sustainability in their supply chain.
After reading this article, you will have a deeper understanding of sustainable procurement. This will allow you to evaluate if it is now the time to switch to a sustainable supply chain.
What is Sustainable Procurement?
Sustainable procurement, also known as green procurement, is the process of implementing an approach that will lessen the impact of your business operation on the environment and society.
It integrates business practices and sustainable corporate behavior into procurement processes, decisions, and policies to care for the environment.
Sustainable procurement helps to create a circular economy that aims to lessen the adverse economic, social, and environmental impacts of purchasing goods and services. Thus, it is not just about finding the right suppliers as it considers how to reduce the impact of a product’s life cycle.
Sustainability can only be achieved when a business has only minimal or zero impact on the environment, society, and economy.
The Importance of Sustainability
Many companies have started seeing their mission to contribute to the betterment of the environment and society. Thus, many of them have committed to reducing their carbon emissions by aligning their business objectives and goals with their corporate social responsibility.
The largest companies in the world, such as Unilever, Panasonic, and IBM, are continuously enhancing their processes to achieve sustainability.
Furthermore, it is significant for compliance reasons. Through this, companies are regulated and they are able to measure their performance to increase sustainability in their process.
Examples of Businesses That Embraced Sustainability
Sustainability is not a new concept and you just have to look to find examples of it in the world around you. Here are some businesses that you may or may not have heard of that embrace sustainability in their fied.
1. Panasonic
Panasonic may not be recognized in the world as one of the most sustainable businesses. However, it is included in this list due to its efforts in reducing environmental impact.
One of its contributions towards conserving the environment for future generations is by making eco-friendly products. Panasonic has made some steps to stop its employees from driving to work which reduced their carbon footprint.
2. IKEA
IKEA is one of the businesses that is recognized worldwide for its efforts in achieving sustainability throughout its supply chain. Stakeholders, employees, and customers are captivated by IKEA’s sustainable practices.
IKEA sources almost half of its wood from sustainable forests which is also the same for its cotton suppliers. IKEA and its suppliers follow the better Cotton Standards that minimize water pollution through organic farming practices. Additionally, the use of pesticides and chemical fertilizers is regulated.
When you visit an IKEA store, you will already see its commitment to sustainability as they source clean energy from solar technologies.
3. IBM
IBM has invested in environmental stewardship and corporate social responsibility since the 1960s. Its first sustainability report in 1990 won the company an award from the European Commission.
IBM’s current smart building strategy reduces demand for natural resources, encourages sustainable procurement, and improves water resource management.
4. Unilever
Unilever is one of the largest multinationals in the world. It has invested heavily in environmental sustainability and receives rewards for its commitment to sustainability.
Unilever has a sustainable living plan which sets a sustainable business strategy. The program ensures that all business operations from sourcing to supply chain go according to the set goals.
Currently, Unilever is one of the globally recognized sustainable companies. Its CEO, Paul Polman, has been awarded the Champion of the Earth Award in 2015.
5. Nike
Nike is not well-known for achieving corporate sustainability due to its past reputation. However, it has strived to change its story.
Its success over a short period of time is due to its commitment to ESG reporting on production and supply chain practices. Nike’s mobile application allows designers to check the different environmental impacts of the fabric they may use.
Nike has redesigned its packaging and encourages customers to recycle or reuse its products to reduce waste. It is also committed to reducing carbon emissions by investing in energy-efficient equipment.
6. PepsiCo
PepsiCo is known as one of the leading food-processing corporations in the world. It has adopted sustainable practices to minimize carbon emissions. Also, one of its immediate goals is to improve human rights and develop a diverse workforce.
PepsiCo plans to reduce sugar and fats in its beverages by 2025. Thus, it reduces the need for the said resources and makes it healthier for consumers. Its other plan is to create and adopt new sustainable packaging designs that make sure that all the materials are recyclable.
7. Patagonia
Patagonia has spent its forty-seven years in businesses leading environmentally conscious business practices. Much of their raw materials are recycled or grown organically to reduce their environmental footprint.
It has built the Patagonia Action Works to help consumers connect with local activist groups in their community. Patagonia has gone beyond by involving politics in achieving sustainability. It encourages its consumers to elect leaders who are environmentally responsible.
8. Adobe
Adobe was the greenest IT company in Newsweek’s 2014 rankings. The company has obtained LEED certification for almost all of its workspaces which includes the retrofitting of a historic building in San Francisco.
Also, Adobe has ambitious goals which involve getting to net zero energy consumption and reducing its packaging to reduce carbon emissions and plastic pollution.
Another commendable sustainability practice that adobe has done is the reduction of water usage. It has consistently tried to use less water since 2000 which reduced its water usage by more than 60%. It has achieved this through installing eco-friendly fixtures and landscaping with native plants.
Conclusion
In summary, sustainable procurement is gaining traction as an essential practice for businesses aiming to reduce their environmental impact and contribute to a circular economy.
The significance of sustainability is emphasized, not only as a commitment to corporate social responsibility but also for regulatory compliance and performance measurement.
The showcased examples serve as inspiration for businesses looking to align their operations with global sustainability goals, fostering a more environmentally conscious and socially responsible business landscape.
Frequentlyasked questions
What is sustainable procurement?
It is the process of implementing an approach that will lessen the impact of the business operation on the environment and society.
What is the significance of sustainability?
It is significant to reduce pollution to contribute to the betterment of the environment and society.
Should all companies embrace sustainability?
Yes. Many businesses are now shifting to a sustainable supply chain. Sustainability reduces costs and streamlines the processes of a company. Additionally, it reduces carbon emissions and any other pollution which contributes to the welfare of communities and the environment.
About the author
My name is Marijn Overvest, I’m the founder of Procurement Tactics. I have a deep passion for procurement, and I’ve upskilled over 200 procurement teams from all over the world. When I’m not working, I love running and cycling.
