Why Sustainable Supply Chains Make Business Sense

The Webinar Will Start Shortly

Monday, 16 March 2015 ● 16:30pm – 17:30pm (UAE)

Ian MoodyLead Tutor

Chartered Institute of Procurement and Supply

(CIPS)

Housekeeping

• Slides will be available on our SlideShare page; the link will be emailed to you

• Recording of the webinar will be available to download; the link will be emailed to you

• Take the time to complete a post-webinar survey that will pop up at the end

• You can type your questions throughout the session

• Time will be allocated in the end for the speaker to address your questions

Your Presenter

Ian MoodyIan Moody Associates Ltd, Management Consultants

Ian Moody has more than 25 years experience in senior management positions. Ian has set up and developed various highly profitable companies and has specific experience in creating exit strategy.

His practical knowledge of strategic development and operational management coupled with a strong sales and marketing emphasis allows Ian’s clients and students to benefit from a ‘real life’ approach to his consultancy and training assignments.

Ian works as a lead tutor and assessor for CIPS both in in the GCC and at London University

Ian’s core expertise lies in the areas of planning, finance and communication at all levels of the organisation. In addition to his work with CIPS he is accredited by major international examining bodies such as the ACCA, & ILM and works throughout Europe, Asia and the Middle East.

He is a Senior Consultant of The Corporate L.I.F.E.™ Centre International, Canada; a world leading consultancy in Business Strategy & Development

Sustainable development

• Long-term decision-making• Sustainable development requires the use of a long-term horizon for decision

making.

• Interdependence• Sustainable development recognises the interdependence of economic,

environmental, and social wellbeing.

• Participation and transparency• Sustainable development depends on decision-making that is inclusive,

participatory, and transparent.

• Equity• Sustainable development promotes equity between generations and among

different groups in society.

• Proactive prevention• Sustainable development is anticipatory: it promotes efforts to prevent

problems and minimise risks as the first course of action.

Key sustainability concerns

Minimise environmental pollution, damage and degradation from industrial activity

Manage waste products (often referred to as the 3Rs: reduction, re-use, recycling)

Reduce greenhouse gas (GHG) emissions, or reduce the ‘carbon footprint’ of organisational activity

Minimise the use of non-renewable materials and resources Design products which are environmentally friendly Design or adapt production processes to be environmentally ‘clean’,

resource-efficient and safe for workers Minimise negative impacts on communities and social amenities from

business activity Ensure the ethical and responsible treatment of labour, supply chains and

communities Build and manage sustainable production capacity

Sustainable consumption

Buying energy efficient equipment and appliances and reducing energy consumption

Reducing unnecessary transport mileage, fuel usage and carbon emissions

Re-using and recyclingPurchasing local, seasonal materials and produce Carbon ‘offsetting’Buying ethically sourced and produced goods Using local, small and diverse suppliers where possibleConsuming less

1. To minimise negative impacts of goods, works or services across their lifecycle and through the supply chain

2. To minimise demand for non-renewable resources

3. To ensure that fair contract prices and terms are applied and respected

4. To promote diversity and equality throughout the supply chain

Four main aims for sustainable procurement

Procurement contributions

Profit: addingeconomic value

• Securing value for money• Effective investment appraisal

and capital purchasing

• Cost management and budgetary control

• Added value• Ethical trading

Planet: addingenvironmental value

• Input to design and specification of green products and services

• Sourcing of green materials and resources

• Green sourcing

• Reducing the waste of resources throughout the sourcing cycle

• Managing logistics to minimise waste, pollution, GHG emissions and environmental impacts

People: addingsocial value

• Encouraging diversity in the purchasing team and among suppliers

• Monitoring supplier practices

• Input to health and safety of products and services

• Fair and ethical trading • Local and small-business

sourcing

Environmental purchasing

Mitigating overexploitation of, or damage to, scarce and non-renewable resources

Addressing climate change

Minimising waste

Implementing supplier selection, development and management processes to ensure that supply chains have adequate capability to comply with environmental standards

Acting as the interface between suppliers and product development and design departments, to encourage knowledge-sharing, research and innovation for ‘greener’ product specifications and more collaborative processes

Developing and presenting the business case for ‘green’ inputs, purchases and processes

Elements of responsible purchasing

Good relationships with suppliers

Clear, timely communication

Sustainable prices

Clear lead-times and payments

Respect for human and labour rights in the supply chain

Support for small-scale producers and homeworkers

Requires a sound ‘business case’ for sustainability

Encourages the use of more resource-efficient goods, services and processes

Encourages purchasers to evaluate cost performance and value over the whole life of a contract

Encourages purchasers to pursue the elimination of wastes throughout the supply chain

Recognises the need to drive job creation, develop new markets and support innovation

Recognises that sustainable markets and supply chains are essential for long-term growth

The economic aspect of sustainability

Key drivers for sustainability

– Values

– Markets

– Transparency

– Lifecycle technology

– Partnerships

– Corporate governance

Values and awareness

Accountability

Stakeholder pressures

Resource scarcity

Financial pressures

Marketing and competitive pressures

Risk

Government policy, law and regulation

Frameworks and initiatives

General drivers for the focus on sustainability

Internal sustainability drivers

• The corporate mission, vision and objectives

• Existing CSR and/or corporate citizenship objectives and policies

• Senior management visionaries, champions and supporters of sustainability

• Accountability and performance management mechanisms

• Robust risk management processes, and the recognition of risks arising from non-sustainability

• Internal stakeholder demand (or support) for sustainability

• The availability of resources, capacity and capabilities to implement sustainable procurement

• The formulation of a robust business case for sustainability

Five stages and emerging drivers

Compliance

Reputational benefits and reputational risk management

Brand proposition, differentiation and competitive advantage

Workforce and supply base commitment

Supply continuity

Minimisation of failure costs

Cost management and efficiency

Improvement and innovation

Shareholder value

Potential benefits of sustainable procurement

The business case for sustainability

• End of webinar

• Thank you for your time