Sustainable procurement takes place when purchasing decisions are made with an aim to meet an enterprise’s need for goods and services and at the same time minimize the impact on environment from such purchase. The idea of sustainable procurement has gained tremendous traction in recent years, with perks involving certifications offered to enterprises that have an active framework in place to make sustainability a part of their procurement process.
As part of corporate social responsibility and to cater to changing customer preferences toward sustainability, global companies continuously look for ways to make sustainability a core part of their procurement process. Implementing sustainable procurement is, however, not without its challenges. It is critical that all stakeholders come together to agree on a common framework, and any small contradiction becomes a hindrance to implementation. Cost estimation is another factor that requires deliberation.
Despite the challenges, sustainable procurement results in cost and risk reduction and leads to revenue growth.