Organisations need to improve sustainability within their supply chain – and RS can help, says Kevin Parke, Senior Director of Procurement
This article is one of a series in which senior management at RS and its parent company, RS Group plc, explore Environmental, Social and Corporate Governance (ESG) and the role it plays strengthening strategies for better management of Maintenance, Repair and Operations (MRO) of company sites and facilities.
Kevin Parke has spent his career working within supply chains and is now the Senior Director of Procurement in the Product and Supplier Team at RS. His key areas of responsibility are the company’s procurement approach, making sure that all products are manufactured ethically and to the right standards, and developing an RS sustainable product range.
In this article, he shares why and how those responsible for MRO purchasing need to improve sustainability within their supply chain and some of the ways that RS can support this process.
Recent events such as the coronavirus pandemic and Brexit have resulted in major changes to business supply chains. In the months and years ahead, ESG measures will mean further changes too. Organisations have little choice about being part of this shift because:
1) The momentum behind ESG is growing. When I talk to people, it is at the top of both theirs and their customer’s agendas.
2) Strong ESG performance has become a proxy for a well-run business and pressure from stakeholders, investors and regulators on businesses to act as good citizens is increasing. In the wake of COP26 in Glasgow in November 2021, we’re probably going to see this develop even further.
3) It therefore makes good business sense for any company that wants to be around in the medium and long term to adapt and lean in to robust ESG practices.
4) As well as helping organisations to grow customers and markets, there are other benefits such as supporting employee attraction, engagement and retention. People want to work for companies that have good ESG policies and procedures.
Improving supply chain sustainability is not, however, purely about tapping into an opportunity for business growth. It is also the right thing to do. We’re talking about a planet that has a problem and all businesses need to take action to decarbonise, reduce risks and invest in opportunities that support the transition to a low-carbon economy.
All aspects of your sustainability journey, including improvements within your supply chain, need to be an integral part of your business plan as it’s designing the way you want to operate in future.
My advice is:
a) Your plan needs to be well thought out but don’t try to do everything all at once. Break it up. Take learnings from other organisations. There's lots of advice out there. Talk to your suppliers, understand what they're doing.
b) It needs to be properly resourced. Integrate it into people’s objectives and workplans so it can be prioritised accordingly.
c) It must be supported from the top to get sufficient dedicated resources and to be actually implemented.
d) If you’ve haven’t already, follow the 80:20 rule. Where is 80 percent of your impact? Are there a few big things that you can do that will make the biggest difference?
e) Build confidence within your organisation that you can act in a different way and doing so is not going to make you suddenly uncompetitive.
Remember it will become easier to improve ESG, and more specifically sustainability, in your supply chain as more businesses adopt the same agenda and make the same demands. Rather than being the lone voice, there might be 100 customers asking a supplier to act in a certain way.
At RS, we’ve already done a lot in terms of sustainability that I’m proud of, including measures that help our customers to operate more ethically and sustainably. Some examples:
• We’re trying to be good citizens by sharing the knowledge we have developed via platforms such as Design Spark and Connected Thinking. This supports others in growing and developing their knowledge.
• We’ve measured our direct and indirect impact in terms of carbon footprint, and we've set targets for improvement. In our direct supply chain, we run fourteen distribution centres around the globe, dispatching 60,000 parcels a day, and we've made a commitment to be net zero by 2030.
• We’re working towards this goal by moving to lower carbon forms of transport and renewable sources of electricity as well as increasing use of recycled packaging while reducing the amount of packaging overall.
• We’re optimising our supply chain to cut emissions, putting items as close to the customer as possible to minimise product miles.
• We’ve set carbon emission targets for our supply chain, saying we will be net zero by 2050.
• One way we’ll get there is by partnering with 65 percent of our supplier base by spend value to set science-based initiatives for reduction.
• We’ve also set out clear policies on ethical and sustainable issues such as child labour and conflict minerals and we're asking all our suppliers to comply with these.
• We’re measuring their compliance using independent thirty-party organisations such as Sedex and Ecovadis.
With us adopting such extensive responsible procurement policies, our customers can be assured that all our products comply with ethical and sustainable legislation around the world.
“We’re in the process of developing a range of sustainable products”Kevin Parke, Senior Director of Procurement, RS Group
To learn about the sustainability goals RS is pursuing and how they support MRO best practice within your organisation, read about the 2030 ESG plan in another article from this series by senior management at RS, exploring ESG and its importance for better management of MRO.