How procurement departments can lead a sustainability ‘assumption revolution’

More than ever, companies are coming under scrutiny for their sustainability credentials. In the UK, EU and the wider world, regulators are clamping down, particularly around greenwashing and lack of supply chain transparency. And while 80% of people globally say they would pay more for sustainable products, they are also becoming savvier: over half of UK consumers would boycott brands found to be misleading in their sustainability claims.

Scope 3 (or supply chain) emissions are the major emissions contributor for most companies. So increasingly, procurement teams face a tough balancing act: they need to develop an ethical, sustainable supply chain without losing sight of traditional concerns such as ensuring profitability and resilience.

To do so involves trusting partners and turning traditional business practices on their head. As leaders, we may find our organisation, our teams or our partners are struggling to take these risks. But this might have nothing to do with courage or capability – and everything to do with checking hidden assumptions.

Could Breakthrough Thinking enable you to take this leap of faith?

Our hidden assumptions are holding us back

There are a lot of conventional assumptions about what ‘successful’ procurement is and what constitutes a profitable supply chain. These could be background assumptions found within teams about the role of procurement generally, alongside beliefs of how their success will be measured.

Driving a sustainability agenda means success must be measured via sustainable objectives rather than cost savings. But do your organisation’s layers know, allow and make room for that?

Context is decisive. Our team’s thoughts around sustainability form invisible beliefs, assumptions and a culture that governs the actions they do or don’t take. It’s the reason why change can sometimes seem to stagnate.

Some hidden assumptions that could be filtering through our teams include:

• “Short-term profit is more important to the company than long-term sustainability.”
• “We’ve made the decision to be sustainable as an organisation but it doesn’t affect my work.”
• “I’ll be told when the sustainability work is relevant to me and when I need to do something about it.”
• “We can only do so much with our suppliers, it’s up to them to make the changes needed.”
• “I really care about climate change but I can’t do much to make a difference.”

Our entire organisation might also be operating within the assumed mindset that: “You can’t manage what you can’t measure”. In this instance, if our sustainability teams have little to measure or report on in the first year of a new initiative, then leaders and boards won’t have the metrics they need to extend resources in those areas.

What are you committed to, really?

With multiple tensions at play both internally and externally around the cost of sustainable growth versus profit, it’s up to leaders to identify what your organisation is committed to.

If your organisation’s KPIs are based on financial gains, then your procurement teams will be motivated to drive towards value and cost-effectiveness. If these KPIs are adjusted to ensure all teams are trained in sustainable procurement, or to eliminate a certain percentage of Scope 3 emissions from the supply chain, then progress can be made and measured differently.

At Unilever, Paul Polman asked, “If the planet was more important than our profit, what would we do differently?”. This became a mandate around everything from project allocation to decision making; procurement to brand strategy.

Cutting back on ‘either/or’ thinking

Breakthrough thinking moves us away from binary ‘either/or’ decision making towards an ‘and’ mindset. Instead of assuming we need to prioritise profit or sustainability, we ask “could both these things be true at once?”. This leads us to eschew old practices and adopt a more nuanced approach.

In a 2020 CDP Supply Chain Report, 8,000 suppliers reported that $1.26tr of revenue was likely to be at risk over the coming years due to environmental threats to supply chains. So clearly profit and sustainability goals are not diametrically opposed. Unless we reward triple bottom line outcomes, we might end up with little profit, and potentially no business.

We can apply ‘And’ thinking to redefine the set of assumptions driving hidden assumptions and behaviours within our organisations. It prompts us to ask:

• “Do all our departments need a sustainability KPI?”
• “What can’t we measure and how do we commit to it regardless?”
• “Why are we doing this? Is it for branding and marketing or a bigger purpose?”
• “Are teams waiting to be told what to do?”

Tuning into our ‘little voice’

We all have a little voice present in our decision-making processes. It’s what governs our responses and forms the bedrock of our assumptions.

This is why Paul Polman’s question (“If the planet was more important than our profit, what would we do differently?”) was so effective. It revealed the ‘little voice’ people were carrying and challenged the core assumptions they were bringing to decisions as a result. He created a new spine in the organisation that would reposition everything from project initiation and execution to stakeholder management and KPIs.

We need to challenge current contexts and reveal the organisational goldfish bowl in which our teams are swimming. If we don’t, we’ll only ever see results within existing frameworks.

Joining the dots for employees

After starting work on the Oxford AstraZeneca vaccine in January 2020, teams at AstraZeneca worked around the clock to bring it to market. We spoke recently with someone at the company about the huge employee engagement opportunity this created.

People were all in on the cause, but researchers, technicians, volunteers and other staff based across multiple sites still needed to feel a sense of meaningful progress to know that their contribution mattered and stay motivated. Important milestones along the way, such as clinical trial results, enabled employees to know their efforts were going to change the course of the pandemic.

As leaders, we need to make sure people see a connection between what they care about and what they do every day, even if the connection isn’t obvious. Most employees want to feel connected to sustainability goals while at work; it’s our job as leaders to foster these aspirations and link them to our organisation’s overall mission.

Looking to create an impossible future? Get in touch to explore how we can help you ignite your sustainability ambitions.