WEF: Can Chief Procurement Officers Champion Sustainability?

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In a new report from WEF, CPOs are spotlighted as future sustainability heroes
In a new report from WEF, CPOs are spotlighted as future sustainability heroes, heralding department and supplier collaboration as the key to progress

According to the World Economic Forum (WEF), Chief Procurement Officers (CPOs) are no longer just overseers of cost and efficiency in corporate settings.

Their roles have evolved to be central in embedding sustainability within supply chains, fostering innovation and handling challenges like emissions reduction and social equity.

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A role evolving with sustainability

The role of procurement has undergone a significant transformation over the past two decades, with the WEF highlighting a shift from focusing solely on speed and cost-effectiveness to prioritising environmental and social goals.

This shift is driven by the imperatives of sustainability, calling for procurement leaders to foster collaboration with departments and suppliers to tackle complex challenges.

Björn Stenecker, CPO at Vattenfall

Björn Stenecker of Vattenfall elucidates how sustainability has revolutionised the typical buyer-seller dynamics into partnerships that champion innovation. Vattenfall's engagements, for instance, include collaborations with steel producers to develop carbon-free materials, aligning with its aim to reduce Scope 3 emissions—those that stem from suppliers. Though Vattenfall might not purchase materials like steel or cement directly, it ensures its suppliers adhere to stringent sustainability standards. Such actions highlight the evolving responsibilities of CPOs who now significantly influence supplier practices, aiding their organisations in meeting environmental targets.

Bertrand Conqueret, CPO at Henkel

Similarly, Bertrand Conqueret from Henkel asserts: “Procurement is leading sustainability into the upstream part of the value chain. No one else is doing it. It’s us.”

Craig Reed, Vice President Global Procurement and CPO, Thermo Fisher Scientific, adds: “If I can leave a solid foundation that’s grounded in sustainability, the regulatory side of it, the social side of it… then I've done my part.”

Craig Reed, Vice President Global Procurement and CPO at Thermo Fisher Scientific

Procurement’s expanding impact

The WEF emphasises that CPOs hold a unique position to address both environmental and social challenges through the supply chain. By promoting fair wages, ethical sourcing, and traceability, procurement leaders not only enhance transparency and equity but also shape long-term organisational strategies, cementing sustainability as a core business principle. For procurement to effectively meet these goals, securing leadership buy-in is essential.

Björn stresses the integration of procurement into a company's broader CO2 reduction strategies. Supply chains are identified as having significant potential for environmental impact. To harness this potential, procurement teams must extend beyond mere cost-saving measures to lead efforts fostering resilience, quality improvement, and growth.

Collaboration is vital. Procurement leaders must closely work with teams in sustainability, technology, and R&D to leverage their expertise, integrate sustainable practices throughout supply chains, and spur innovation. This integrated approach allows procurement to support the business more holistically, ensuring that sustainable practices align with broader operational goals.

Building a legacy of collaboration

According to WEF, contemporary CPOs bear the responsibility of cultivating a culture focused on collaboration and innovation, ensuring sustainability becomes a natural part of future decision-making processes. Björn advocates for breaking down organisational silos and engaging suppliers as partners in sustainability, with transparency and shared metrics being crucial for building trust and aligning goals.

Oliver Bischof, CPO at Siemens Gamesa, emphasises the importance of not only innovating but also industrialising these innovations, to embed sustainability as a norm in the supply chain. This forward-thinking approach not only meets immediate sustainability targets but also lays the groundwork for long-term systemic change, by imprinting values that prioritise resilience and creativity and thus empowering future leaders to navigate evolving challenges.

Oliver Bischof, CPO at Siemens Gamesa

The only way to learn from other functions is by connecting with people.

It’s not about telling someone how you’ve done something and expecting them to follow.

It’s about understanding how they do their job, what makes them successful and finding ways to collaborate by integrating my capabilities with theirs.

Lauren Richardson, CPO at Colgate-Palmolive
Lauren Richardson, CPO at Colgate-Palmolive

As WEF points out, CPOs are navigating uncharted territories as they expand procurement's role into the ambit of organisational leadership for sustainability. Success will rely heavily on collaboration across industries and companies. Sharing best practices, insights, and strategies will be pivotal for procurement leaders to collectively advance their sustainability ambitions.

By focusing on building the business case for sustainability, elevating procurement's role within corporate strategy, and fostering innovative partnerships, CPOs can facilitate meaningful systemic change.

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