Incorporating sustainability in the brand’s value proposition is also likely to affect the definition of what constitutes a valuable supplier for the organization. Suppliers that commit to CSR demonstrate their ability take on a long-term vision, which is an essential component of building strategic relationships. Opportunities created by actively pursuing a sustainable procurement agenda. Most large organisations have adopted some aspects of good sustainable procurement practices. This is borne out by aspects of the Business in the Community’s (BITC) corporate responsibility index, a leading benchmark of responsible business in the UK 5.

• Why Sustainable Sourcing Is Good For Businesses
• Why Sustainable Sourcing Is Good For Business Marketing
• Why Sustainable Sourcing Is Good For Business Entities

Increasingly, businesses are making strategic decisions around the type and extent of their corporate sustainability policies. In addition to environmental and social benefits, companies that incorporate sustainability into decision-making processes can reap significant financial advantages and attract more interest from investors, which is a key to long-term profitability.

Yet sustainability can have a variety of meanings, depending on the business context. On this article, you will understand how the concept is applied in terms of the environment, employment practices and business practices.

Environmental sustainability

Environmental sustainability can be applied in many ways, such as creating alternative routes in a production process to reduce waste generation and increase water and energy efficiencies. Investment in renewable energy is also growing momentum among big organisations, with many building their own solar or wind farms, in order to phase out the consumption of fossil fuels and reduce their carbon emissions.

Climate change, one of the biggest challenges of our time, continues to influence the way companies are doing businesses. Research undertaken by CDP shows that last year, 215 of the world’s largest companies reported that they saw nearly $1 trillion at risk from climate impacts, but also $2 trillion in opportunities. Thus, climate leadership is a key to ensure the profitability of organisations over the next decades.

Attaining the carbon neutral certification under the Climate Active Program – a program from the Australian Government that certifies companies, products, events or buildings that are able to neutralise their GHG emissions – is a great incentive for organisations to show climate leadership. The certification contributes to improve the image of companies, as consumers have been asking for urgent climate action.

Sustainability and employment

Why Sustainable Sourcing Is Good For Businesses

Businesses with strategies that are sustainable in the long run pay their workers’ salaries and benefits that allow them to live a sustainable life within their community. This builds loyalty within the organisation, benefiting the company through increased productivity and creativity, as well as lower levels of fraud and mismanagement.

Besides, when organisations look to improve the health and well being of communities, they are able to motivate employees who are genuinely interested in contributing to the success of the business.

Sustainability in business practices

Pushed by growing demands from consumers for products and services that cause minimal effects to the ecosystems, corporations have shown interest in bringing sustainability aspects to the core of the business. Another driving force behind this is the pressure from investors, who are already considering the level of corporate social responsibility, in other words, the role of businesses to address the needs of society, as a decisive factor on their choice of organisations to allocate capital.

Sustainable investing – the process of incorporating environmental, social and governance (ESG) factors into investment decisions – is becoming a common practice. Corporations are going beyond the desire of profitability, which is shown by their growing efforts to build internal environmental policies and also take part in global tendencies, like the alignment with the Sustainable Development Goals (SDGs) – topics suggested by the United Nations to guide organisations on the development of policies towards sustainability.

Therefore, the incorporation of sustainability principles into business practices is becoming mainstream. Companies who don’t follow this tendency are likely to lose credibility from investors, as well as opportunities to generate revenues and the chance of being an example to society.

Are you looking for ways to incorporate sustainability into your business? Contact us today.

Corporate social responsibility (CSR) is rapidly becoming a key market differentiator for businesses as more consumers look to purchase products from companies that act responsibly.

So it comes as little surprise that significant efforts are underway to incorporate sustainability within supply chains. Gartner’s 2017 Future of Supply Chain Survey data highlights how companies view CSR as an opportunity to enhance their brand reputation, rather than just satisfying government regulations. Eighty two percent of respondents say their organization’s intention to invest in ethical sourcing is because “it’s the right thing to do.”

Far from perceiving sustainability as a costly inconvenience, supply chain leaders are using it to their advantage

“With the rise of social media, a spotlight can easily be shined on companies — and their suppliers — that fail to operate in a sustainable way,” says Miguel Cossio, principal research analyst at Gartner. “Far from perceiving sustainability as a costly inconvenience, supply chain leaders are using it to their advantage, as it provides new opportunities to optimize costs and reduce waste.”

Explain the importance of responsible sourcing

Adoption of responsible sourcing will require supply chain leaders to make sustainability a non-negotiable element that is as important as quality. This in turn will impact how sourcing teams are measured. Performance recognition is often given to sourcing leaders based on cost reduction, yet some of the savings achieved through sustainability will likely be realized outside unit price. For example, changing material specifications to enable better recycling yields may not change the unit price but will still result in savings based on its total cost of ownership.

“Sourcing leadership teams should encourage the incorporation of sustainability objectives into their team’s performance metrics and strike a balance with other financial objectives,” says Cossio. “This will require sourcing leaders to educate internal team members on the importance of CSR for the organization and help them create a story to articulate to suppliers why CSR is now a key factor in sourcing decisions.”

Supply Chain Scenario Planning

4-step guide to running a supply chain scenario planning exercise Ice escapewatermelon gaming chair.

Incorporate CSR in your supplier relationship management programs

Incorporating sustainability in the brand’s value proposition is also likely to affect the definition of what constitutes a valuable supplier for the organization. Suppliers that commit to CSR demonstrate their ability take on a long-term vision, which is an essential component of building strategic relationships. Evernote for mac yosemite high sierra. For this reason, supply chain leaders need to revisit their segmentation strategies and reassess their selection of strategic suppliers engaged through their supplier relationship management (SRM) program.

“Clearly communicate the importance of sustainability to strategic suppliers,” advises Cossio. “Provide a clear indication of what is expected from them, how you will measure sustainability performance and a clear timeline for complying with your minimum expectations. Be prepared to provide support to help your suppliers transition.”

Look to existing sources for support

Why Sustainable Sourcing Is Good For Business Marketing

In order to integrate CSR into the strategic sourcing process, supply chain leaders will need to identify and use data from external sources and service providers. A number of sources are available to help outline a responsible sourcing strategy, such as:

Why Sustainable Sourcing Is Good For Business Entities

• Competitor activity. Look at what your competitors are doing in terms of responsible sourcing and in what areas of procurement they have implemented sustainability criteria.
• Industry associations and nongovernmental organizations (NGOs). These organizations have data, key performance indicators and solutions that you can leverage.
• ISO 20400. This is the world’s first international standard for sustainable procurement, which provides guidance to organizations on how to integrate sustainability within procurement.