Why FM companies must embrace sustainable procurement now

By Mellita D’Silva, lead Consultant, Sustainable Procurement

As a specialist in sustainability advisory services, Action Sustainability leads industry initiatives such as the Supply Chain Sustainability School and manages ISO20400.org, a free global resource for sustainable procurement.

Despite what you might think, sustainable procurement isn’t complicated. It simply means running your procurement and operations in a responsible way for your business, society, and the planet.

ISO 20400 has quickly emerged as the essential framework that forward-thinking FM leaders are adopting, following the challenges of Brexit and the global pandemic. Material shortages, rising labour costs, and supply chain resilience challenges have all made this standard essential for procurement teams and end users alike.

To effectively address climate adaptation and meet social value goals, we will need to leverage our procurement’s influence on spend. ISO 20400 provides a guidance framework that helps organisations translate their ESG considerations through a Golden Thread methodology. From corporate policies to department level applications (commercial, finance, SHEQ, site teams, procurement, end users), through the tender process, and out to your supply chain.

In facilities management, we see growing environmental awareness and urgency to reduce carbon footprints. This connects with economic and social aspects of sustainability, including use of local suppliers, diverse businesses, and proper due diligence on labour utilisation.

When you break down facilities management into hard FM and soft FM, you’ll find distinct challenges. Soft FM typically faces issues around material sourcing, ethical waste disposal, and product certifications. Hard FM encounters sustainability challenges (similar to the M&E sector) including country of origin certifications, recycling, reuse and repurposing of old parts, and labour related sustainability risks.

Sustainable Procurement in FM plays a significant role in supporting a company’s ESG agenda. Embedding ESG requirements into your procurement process not only mitigates sustainability risks, but also creates opportunities for economies of scale, improved profitability, repeat business, increased investor confidence, and stronger community engagement.

It’s not always easy to know where to start, but a good place to begin is by determining the areas where you can make the biggest impact. By its collaborative nature, planned and preventive maintenance naturally allows for early conversations with your supply chain on waste reduction, recycling, carbon footprint, water use, labour vetting, modern slavery prevention, EDI practices, and more. Engage your key, strategic supply chain and the larger players in the market for labour and material categories, to understand the risks associated with what is being procured and where opportunities also lie for social value generation.

For both client-side FM teams and service providers looking to better align their sustainable procurement practices, here are some tips:

• Develop a procurement strategy that directly supports your ESG objectives.
• Implement this strategy by embedding sustainable practices throughout operations: energy efficiency, waste reduction, eco-friendly product selection, and thorough staff and labour due diligence.
• Select suppliers who don’t just talk sustainability but demonstrate the capacity to deliver on your criteria. Make sure they can provide recognised credentials, commit to carbon and waste reduction, and demonstrate transparent human rights and labour practices.
• Moving away where possible from reactive, tactical procurement to strategic procurement with early supplier engagement around sustainability goals.
• Upskill your team and supply chain network with free, expert-led training from the Supply Chain Sustainability School.

To learn more about ISO 20400 and assess your organisation’s sustainable procurement maturity, take this brief 20 question self-assessment: www.iso20400.org/take-the-self-assessment/

You can also hear from industry experts and Supply Chain Sustainability School Partners Keith Chanter, CEO at EMCOR and Rory Murphy, from VINCI Facilities talk about why implementing sustainability makes business sense for your FM operations: https://www.youtube.com/watch?v=5PsBEXHr2PU