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When it comes to addressing sustainability, chances are that every procurement organisation will have its very own priority categories.
The PIU conducted research into this area last year and asked 150 CPOs and other senior procurement leaders from across the globe which categories they were planning to “green” next in 2011.
We received a wide spectrum of responses, demonstrating the differing views on which categories should be tackled first.
Surely, this choice largely depends on the industry a company operates in and some sort of risk assessment. ("This category could get us into a lot of trouble if we don’t find a green(er) alternative for it,” noted one CPO).
Interestingly, the most frequently mentioned categories to be “greened”, our results showed, were energy, logistics and packaging. You could make the argument here that these categories are fairly easy to green in the sense that there is an industry that offers green(er) alternatives. This is not necessary true for all categories. A case in point is raw materials, which, in some cases, require a re-engineering of the supply chain.
As procurement organisations plan and develop sustainability plans, it is helpful not to look at the company in isolation, but to understand all the “external” influencers. In its forthcoming research, The Five Forces Driving the Green Agenda, the PIU maps these interactions to understand who is driving the green agenda:
The way each of these forces affect a company, again, depends on the industry it operates in, and its position in the value chain. For a company in the energy sector, the primary driver might be government regulations, but a FMCG company will likely be influenced by consumers for the most part.
Understanding these dynamics work can help a company make more targeted efforts and possibly even maximise its ROI on any of its sustainability initiatives.