SUSTAINABLE PROCUREMENTFullscreen Mode
TOPIC 1
INTRODUCTION TO SUSTAINABLE PROCUREMENT
DEFINITION OF TERMS USED IN SUSTAINABLE PROCUREMENT
Sustainable Procurement is a ―process of acquiring goods, works and services from a supplier that provides the optimum combination of whole life costs and benefits to meet the customer‘s requirements. It is a process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organization, but also to society and the economy, while minimizing damage to the environment.
Sustainable procurement builds on the traditional procurement practice which it seeks to extend through the adoption of sustainability principles. Procurement is defined as acquisition of goods, works and/or services from the supplier (this may be an individual or organization). The procurement process is viewed as involving sourcing (planning: needs identification and assessment, supplier selection) contracting, monitoring and evaluation, and expediting; Sustainable procurement means taking into account economic, environmental and social impacts in buying choices. This includes optimizing price, quality, availability …but also environmental life-cycle impact and social impacts linked to product/service‘s origin.
IMPORTANCE OF SUSTAINABILITY
In both private and public sectors, there is increasing pressure from customers, clients, government and the public to put sustainable procurement into practice. Organizations practicing sustainable procurement meet their needs for goods, services, utilities and works not on a private cost-benefit analysis, but with a view to maximizing net benefits for themselves and the wider world. In so doing they must incorporate extrinsic cost considerations into decisions alongside the conventional procurement criteria of price and quality. These considerations are typically divided thus: Environmental, Economic and Social. The important areas of environmental concerns are; more efficient use of raw materials in manufacturing operations, pollution and waste, and energy savings.
Sustainability helps an organisation to:
- control costs by adopting a wider approach to whole life costing
- Improve internal and external standards through performance assessments.
- Comply with environmental and social legislation
- Manage risk and reputation
- Build a sustainable supply chain for the
