Talking about using sustainability to help your company save money and improve innovation is a bit like politicians who talk about being “pro education.” (Everyone is pro education! But how do we do it?)
There is real evidence these days of the value of collaborating with suppliers on sustainability. Sometimes the needs are directed at the long term reliability of critical product ingredients, such as Starbucks working with coffee farmers around the world, or Levi Strauss with cotton farmers. Sometimes the opportunity can combine issues such as supporting local businesses and reducing transportation, such as McDonalds’ commitment to source only local chicken for the Olympics in London.
We have found some basic concepts to hold true:
- Tip #1: Innovation with suppliers in corporate real estate management can reduce the environmental impact of operations and save money in areas such as waste disposal, paper, and electricity. Ask your key suppliers what you could be doing better (together) to leverage industry trends about which they are aware.
- Tip #2: In your supplier sustainability evaluation, include questions or ratings for how your suppliers are innovating on your behalf and/or how actively they participate in your company’s sustainability initiatives. Procter & Gamble does this in its supplier scorecard and it’s a brilliant way to encourage the right behavior.
- Tip #3: Leverage third party standards for the industries to which your suppliers belong, e.g., LEED for buildings or ENERGY STAR for electronics or IEEE for technology, or the Carbon Disclosure Project.
JLL has recently conducted industry research and surveyed almost every one of our client-focused procurement managers in the U.S. (managing more than $1.5 billion in spend) in order to create our next generation supplier sustainability practices. It’s important to integrate sustainability across the chain, from client services to operations to suppliers.