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Going green: A primer on adopting sustainable practices

Going green: A primer on adopting sustainable practices
December 20, 2021

ESG's increasing relevance

Right around the time when COVID-19 evolved to become a pandemic, it served as a clarion call for procurement professionals to highlight 'risk' as a mammoth concern for businesses across the world. In particular, the impending disruptions to overly optimized and connected supply chains had spooked the entire community into obsessing about this problem for longer than expected.

Fast forward to today, the matter of risk seems to have decreased in relevance as its counterpart: ESG (Environmental, social and corporate governance), entered the collective corporate consciousness. While this may seem like another shift to a sustainable future that will subside soon, it’s essential to understand its relation to the global supply chain and why the debate around ESG and sustainable solutions is here to stay.

For starters, humanity has perfected communications to the point where we can broadcast global emergencies in real-time to everyone on earth. We have also developed the tools to deal with climate change, resource allocation, and more, allowing us to process the damage meted to the environment in the name of development.

These tools come in all forms: from enterprise platforms that can process seemingly infinite flows of data, artificial intelligence, and automation that allows us to rapidly sort, analyze, and process this data for practical use, to organized markets for sustainable, reusable, recyclable, and repurposable goods, and vendors that provide bespoke assessment services, ratings and consulting. We are also spoilt for choice when it comes to the means for solving this impending ecological crisis and building a sustainable future.

More than anything else, the increasing pressure from the younger generations of the global population is driving this sustainability trend. Younger generations have lost faith in the old order’s ability to find solutions to this issue and are actively rallying against it. It means that consumer sentiments are also shifting towards sustainable practices, a shift that corporations would be imprudent to ignore. These stresses with other regulatory pressures have provided the impetus for a systemic change in the purchasing consumer choices.

Sustainability is no longer a feather in the cap for businesses, and it is a trend that can help organizations significantly increase their reputation, market share, and bottom line. Senior executives who get in on this trend early and use their influence to alter supplier behavior in favor of sustainable practices will find it to be hugely advantageous for their companies. These behavioral changes will also benefit the suppliers and societies they are a part of in the long run.

HCL's commitment to ESG

The global supply chain management market is growing increasingly relevant to international trade and is estimated to grow at a CAGR of 11.2% over the next six years. HCL recognizes the economic implications of the global supply chain and realizes its unique position to contribute to the championing of sustainable practices. Much like us, procurement professionals across the globe wield immense power to change things, and it is high time they realize this and direct their efforts towards championing sustainability.

Procurement professionals across the globe must realize and direct their efforts towards championing sustainability.

Given our long-standing partnership with SAP, we are currently working on a slew of initiatives that seek to fuse the analytic prowess of the SAP platform with the vast pools of data and tools built to aid in the global movement towards sustainable practices. Our current focus is on developing these tools for e-commerce and the global supply chain. We are deeply committed to empowering supply chain professionals with the right tools for ascertaining the carbon footprints of their respective operations.

In fact, in the practice (a subset of our ), we are working to build a sustainable future. For starters, we have established a formal partnership with several third-party vendors of sustainability solutions (such as Ecovadis and WaterPlan) to deepen the integration of these tools into the entire Ariba ecosystem. Our goal is to facilitate proactive supplier engagement on sustainability matters and sustainable procurement and buying practices.

Our recent participation in an SAP Hackathon is evidence of our growing commitment to ESG. The hackathon resulted in a solution prototype that combines the risk and sustainability measuring capabilities from SAP Ariba to SAP Fieldglass. This prototype was a reflection of our belief that it is the optimal time to look at sustainable solutions beyond generic goods and materials and integrate them into other equally important areas, such as services and contract work.

Beyond the prototype, we are developing an arsenal of integrations between SAP Ariba and newer marketplaces like the ones mentioned above to accelerate the adoption of sustainable, reused, and refurbished goods. We’ve also extended these efforts to incentivize sustainable practices amongst buyers and suppliers through nifty modifications to existing tools, such as Ariba's dynamic discounting.

We continue to work with existing clients to use Ariba's existing capabilities and help them progress in their internal sustainability initiatives. Demand aggregation to reduce shipments and carbon footprint of transactions, and greater collaboration amongst suppliers, are two prominent solutions that we have helped them implement.

Getting started

As daunting as it may seem, we live in a time where getting started on the path to sustainability is the easiest it has ever been.

Key management personnel across the chain of command, especially procurement professionals, should realize that regulatory headwinds are blowing in favor of sustainability. Those who are quick to capitalize on this trend will enjoy a head start that will pay huge dividends in the future.

A way to get started is to get your company assessed by an agency specializing in sustainability. Irrespective of how poorly you may perform in the initial screening, it is a signal that you are committed to making the transition to more sustainable practices. This assessment can form the bedrock upon which you can build your action plan and extend the same to all the parties (especially suppliers) with whom you are transacting.

Identifying talent within your organization who are passionate about sustainability and entrusting them with the responsibility of onboarding your workforce is essential. Finally, working with a trusted partner like HCL to identify ‘low-hanging fruits’ that are easy to implement and yield positive results will also serve as a confidence booster for your company. This confidence can serve as a powerful impetus for future actions on gigantic and more transformative sustainability initiatives. It’s imperative to get started and realize that small steps will eventually compound to significant momentum.