What future do we want to build for future generations? And why do we need to act now?

This is a question with many answers and only one certainty: we – people, companies and governments – are responsible for promoting actions that significantly reduce the negative impacts of our activities on the planet.

When it comes to purchasing and supply chain, being sustainable is no longer a choice. And it is precisely for this reason that the circular economy, ESG and supplier management are fundamental dimensions for the sustainability of the sector.

The topic, which has been increasingly discussed in companies, has procurement as the guiding thread for the reflections and transformations that urgently need to be promoted.

It was with this growing demand in mind that ME B2B Summit 2021 promoted the panel “The future of shopping is sustainable”, with the presence of big names in the market:

• Dominic Schmal, Director of Sustainability and EDP Institute;
• Murilo Zappelini, head of procurement for South America at ALPLA;
• Francisco Cortinas, director of supplies at Hidrovias do Brasil;
• Priscila Miguel, coordinator of FGV-CELog.

Below, check out the main experiences of the event's guests regarding the role of the buyer in the circular economy, ESG practices and supplier management.

Sustainability as an organizational culture

In the dictionary, the word “journey” means “walk”, “hike”. The truth is that the race for sustainability never ends. It is a means, not an end.

In the corporate world, the purchasing department is one of the main players in this journey. And sustainable purchasing goes far beyond the inputs chosen for its production.

It is essential – and very challenging – to ensure that the entire production chain does not violate human rights. It is also essential that there is no bribery or corruption in negotiations.

These and all other issues involving sustainability and compliance need to be a priority on the agenda. CPOs – whose mission is to expand discussions within companies.

Despite this, the purchasing department cannot and should not walk alone on the sustainability journey. The entire company must act responsibly and commit to ESG aspects.

For sustainability to become a reality, that is, to become a culture, the circular economy, ESG and supplier management must comply with more than just legal aspects.

Circular economy goes far beyond disposal

It is almost impossible to talk about sustainable actions without rethinking, reducing, recovering and recycling materials and energy. These are the 4R's of sustainability linked to the circular economy.

In purchasing, it is necessary to redefine the production and disposal model of products. The main point is to change the mindset of organizations' responsibility in this regard.

When talking about product change, for example, most of the time, the first question that arises in organizations is price – and not added value.

In this sense, the purchasing department needs to step out of the audience and onto the stage. Only then will the department be able to promote significant changes for organizations and society.

Increasingly, aspects that promote the circular economy, such as product life cycle assessment and ecodesign, must be part of companies' strategies.

Therefore, more than encouraging the circular economy, sustainable purchases will help companies remain competitive in a competitive market.

Supplier engagement starts in-house

Just like the circular economy and ESG, supplier management and purchasing need to work together on the journey towards sustainability.

In companies, sustainability policies contain the requirements for supply, but unfortunately they are not enough to ensure good practices on the part of suppliers.

And that's where the importance of having supplier management practices, such as approval, a stage in which fiscal, labor, environmental aspects, among others, are verified.

In addition to having very well-designed processes, on this journey, it is necessary to see the supplier as a strategic partner, have a close relationship and, of course, be a listener.

For all these requirements to be successful and to engage suppliers, it is essential that sustainability actually happens from the inside out – and not the other way around.

 

Above, we saw the main points discussed in the panel “The future of purchasing is sustainable: circular economy, ESG and supplier management”, at the ME B2B Summit 2021.

In addition to environmental issues, adopting policies that consider aspects of diversity and inclusion are no longer a trend and are increasingly becoming a reality.

And in your company, how have issues of circular economy, ESG and supplier management been addressed?

Share in the comments!

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