Green procurement, also known as sustainable procurement is important, not only because the resources are becoming scarce and are over utilized by the developed world. It's important because purchasers, whether serving public sector run organizations or privately held companies, yield a great influence over the future of the planet with every buying decision they make. More importantly, every purchase has a hidden impact on the environment.
Rather than using a private cost-benefit analysis, organizations practicing sustainable procurement meet their needs for goods, services, utilities, and works with a view to maximizing net benefits both for themselves and the wider world. Our business models encourage people to consume the resources to such an extent that nature is unable to regenerate these resources and we are already facing scarcity of many of them. However, we have the opportunity to re-think the way we do business.
To truly achieve green procurement, organizations must take into consideration three parameters: social, economic, and environmental (SEE). Social, environmental and economic risks are today's business risks. You have to have a strategy both for tackling and communicating about these challenges.
The promise of green procurement
At its best, green procurement is simply a better path to successful business and offers a path to a handful of clear advantages:
- Brand value: A company who opts for green procurement will always be seen as a more responsible company and hence will improve the image of the company in a positive way in the eyes of people making it a more reliable brand.
- Compliance with the law: Going green not only improves your brand value but also helps the organization fall in line with the safety rules and regulations. There was a significant amendment to article three of the Treaty of the European Union. The article states that in order to achieve a balanced economic growth and price stability and a highly competitive social market economy, the EU should aim at full employment and social progress, as well as a high level of protection and improvement of the quality of the environment. Many suppliers are involved in emitting hazardous waste, in conflict with existing laws, and are certainly going to face the music with the environmental agencies. The company and its employees are all likely to suffer the consequences. Further, more and more green regulations are being created so preparation is paramount. EU has taken action, and certain environmental criteria already exist in EU legislation.
- Waste reduction: Going green can improve the overall efficiency of a business. Reducing unnecessary waste can trim operating costs for the business, for example. Turning off lights in vacant offices saves energy, saves on utility costs and increases the company's bottom line. Printing less cuts down on paper usage, and can lower the budget spent on printing materials.
- Environmental benefits: Public procurement, made more environmentally friendly, might directly influence such problems as greenhouse gas emissions, air, water and soil pollution, water use, deforestation etc. Similarly, indirect environmental benefits are deemed to arise as well. Green public procurement might raise awareness in public about environmental issues – success in public sector could possibly encourage private sector to include green procurement policies into their activities as well. Also, it could be used as a mean to disseminate information about the environmental impact of concrete products.
Be socially responsible
Green procurement is also used to address the social problems and policy. Corporate social responsibility (CSR) alone does not make a company socially responsible. Rather, it must be deeply embedded in the company culture as part of a larger business strategy. Companies are quickly realizing that CSR increases profits and contributes to the bottom line in addition to improving the world.