Engaging Your Suppliers on the Benefits of Sustainable Procurement

Supply chains have become increasingly global and complex, and as such, the benefits of sustainable procurement have evolved from being a niche corporate goal to a critical business objective. The introduction of frameworks like ISO 20400 and the growing demand for Environmental, Social and Governance (ESG) transparency will influence more organisations to go beyond cost-based purchasing. They must now consider how their buying decisions influence environmental footprints, social equity, and long-term economic resilience.

Understanding the Benefits of Sustainable Procurement

The benefits of sustainable procurement extend far beyond compliance or reputation management. It is an approach that integrates environmental, social and ethical considerations into procurement processes to create positive outcomes for people, the planet and profits. These benefits are far-reaching and encompass various aspects of a business, including:

1. Strengthening Supply Chain Resilience
   Sustainable procurement helps businesses identify vulnerabilities within their supply chains. By partnering with suppliers who follow ethical labour practices, manage resource use responsibly and maintain transparency, companies can reduce their exposure to disruptions such as resource scarcity, political instability or climate-related events.
2. Cost Optimisation Through Resource Efficiency
   Contrary to the misconception that sustainability increases costs, adopting the benefits of sustainable procurement often results in long-term financial savings. Suppliers implementing energy-efficient processes, waste reduction systems and renewable material sourcing can pass on those efficiencies to buyers.
3. Enhancing Corporate Reputation and Stakeholder Trust
   Procurement and sustainability are now inseparable. Investors, customers and regulators expect transparency around where and how goods are produced. Businesses that demonstrate leadership in sustainable procurement attract ethical investors, improve customer loyalty and meet the rising expectations of stakeholders concerned about modern slavery, carbon emissions and biodiversity impacts.
4. Enabling Innovation and Collaboration
   The benefits of sustainable procurement also include driving innovation through supplier collaboration. Suppliers that are engaged in sustainability efforts tend to develop new materials, processes or circular models that reduce waste and create shared value. A practical example is the automotive sector, where partnerships around sustainable materials have led to the development of lightweight, recyclable composites.
5. Supporting Net Zero and ESG Goals
   Sustainable procurement underpins wider sustainability frameworks, helping organisations measure and manage Scope 3 emissions, which typically account for 70–90% of total corporate carbon footprints. By engaging suppliers in sustainability reporting and target-setting, companies can align procurement practices with broader goals such as Science Based Targets or Net Zero commitments.

ISO 20400 and Sustainable Procurement Policy

To translate the benefits of sustainable procurement into action, organisations need a structured framework. The international standard ISO 20400 provides guidance on embedding sustainability throughout the procurement lifecycle, from strategy and planning to supplier selection and contract management.

Key Principles of ISO 20400:

• Accountability and Transparency – Clear communication of sustainability expectations and results throughout the supply chain.
• Respect for Human Rights and Ethical Behaviour – Ensuring suppliers adhere to fair labour practices and anti-corruption standards.
• Lifecycle Thinking – Considering the environmental and social impacts of products or services across their entire lifecycle.
• Collaboration and Innovation – Working jointly with suppliers to co-create solutions that deliver shared sustainability outcomes.

A robust sustainable procurement policy, aligned with ISO 20400, should articulate these principles clearly. It should also define measurable goals, such as emissions reductions, supplier diversity targets or waste minimisation and specify how procurement teams will monitor compliance and performance over time.

Learn more about ISO 20400: Sustainable Procurement ISO 20400 | Tunley Environmental

Building a Sustainable Procurement Strategy

Creating a successful sustainable procurement strategy requires a structured approach that integrates sustainability into every procurement decision and emphasises the benefits of sustainable procurement. The following stages outline how organisations can develop and operationalise this strategy effectively.

1. Assess Current Procurement Practices
   The first step is to evaluate the organisation’s current procurement operations. This includes mapping the supply chain, assessing supplier sustainability maturity, and identifying environmental,social and governance risk hotspots. For example, when considering carbon footprint of products, Life Cycle Assessments (LCAs) can be instrumental in identifying where the greatest impacts occur.
2. Set Clear Sustainability Objectives
   Define what sustainability means for the business in practical terms. Objectives should align with broader ESG frameworks, such as the UN Sustainable Development Goals (SDGs), the Science Based Targets initiative (SBTi) and national Net Zero strategies. Common objectives include:
   - Reducing Scope 3 emissions.
   - Increasing the use of recycled or certified materials.
   - Supporting small and medium-sized local suppliers.
   - Eliminating suppliers linked to environmental harm or labour violations.
3. Develop Supplier Engagement Programmes
   Engaging suppliers is central to unlocking the benefits of sustainable procurement. This can be achieved by:
   - Communicating sustainability expectations clearly through supplier codes of conduct.
   - Hosting supplier workshops or sustainable procurement training courses.
   - Incorporating sustainability criteria in tenders and contracts.
   - Providing resources and technical assistance to help suppliers improve their sustainability performance.
   The main goal is to educate all stakeholders on the benefits of sustainable procurement.
4. Monitor, Measure and Report
   Ongoing evaluation is crucial to ensure continuous improvement. This includes setting Key Performance Indicators (KPIs) for sustainability and integrating them into supplier scorecards. Digital tools, such as supplier assessment platforms, can streamline this process by collecting real-time sustainability data.
5. Embed a Culture of Procurement and Sustainability
   To sustain long-term impact, procurement teams need the right skills, incentives, and leadership support. This involves:

• Embedding sustainability into job descriptions and performance metrics.
• Investing in sustainable procurement training courses for staff.
• Recognising and rewarding teams and suppliers who contribute to sustainability goals.

Overcoming Supplier Resistance

One of the biggest challenges in achieving the benefits of sustainable procurement is supplier resistance. Suppliers may perceive sustainability as costly, complex, or irrelevant to their business model. Addressing these barriers requires a mix of communication, collaboration, and incentives.

Common Barriers and Solutions:

Communicating the Benefits of Sustainable Procurement to Suppliers

When engaging suppliers, it’s essential to frame sustainability as a mutually beneficial opportunity rather than a compliance burden. The communication should emphasise three core themes: business value, risk reduction, and future competitiveness.

• The Business Case: Suppliers that align with sustainable procurement principles gain preferential access to contracts, partnerships and markets that prioritise ESG performance. Highlight that sustainable suppliers are increasingly being favoured in public and private sector tenders, particularly under frameworks such as the UK Government’s Procurement Policy Note (PPN) 006.
• Risk Reduction: Sustainable procurement minimises exposure to regulatory fines, reputational damage and operational disruptions caused by unsustainable practices. Suppliers that can demonstrate compliance with environmental and social standards are more likely to retain long-term business relationships.
• Competitive Advantage: Global supply chains are evolving rapidly. Suppliers that invest early in sustainability capabilities, such as carbon reporting, waste management and biodiversity protection, position themselves ahead of competitors. Buyers are more likely to partner with suppliers that can demonstrate proactive sustainability leadership.

Tunley Environmental Science Co-Lead Dr Luan Ho recently discussed in detail the benefits of sustainable procurement with Brian Straight, the host of the podcast Talking Supply Chain.

You can listen to the episode in full here: Talking Supply Chain: Sustainable Procurement

The Bottom Line

The benefits of sustainable procurement for organisations are clear: enhanced resilience, cost efficiency, innovation and stakeholder trust. More importantly, it enables organisations to transform procurement from a transactional function into a strategic driver of sustainability. By following international frameworks like ISO 20400, developing a robust sustainable procurement policy and investing in supplier engagement through sustainable procurement training courses, organisations can unlock value across every link in their supply chain.