Clarify Responsibilities

Implement an organisational procurement operating model

There are three procurement operating model categories: centralised, decentralised, and centre-led or hybrid. Each has its own benefits and drawbacks. A centralised procurement model allows for a standardised approach and greater buying power but can be slow and bureaucratic. A decentralised model can be more innovative, and adaptive, but can also be less consistent.³ While a centre-led model can balance the benefits of both approaches, you need to determine which approach best supports your organisation’s sustainability priorities. Start by considering where sustainable procurement expertise and responsibility should reside. Think about how this will impact collaboration, resourcing, and leadership engagement.

You can help balance your approach by establishing sustainability centres of excellence.⁴ They can provide expert guidance to category managers and other procurement staff and support effective implementation. They can support cross-functional coordination and improve value chain risk management.^{5, 6, 7} No matter what model you choose, consider how you can align internal sustainability behaviours and accountability through well aligned KPIs and incentives.

EXAMPLE: A. P. Møller-Mærsk considers adding centres of excellence to its two existing sustainability teams

The integrated container logistics company has a Group Sustainability Team driving company-wide sustainability efforts, a CSR compliance team embedded within its procurement function, and sustainability responsibilities attached to each procurement role. The company then turned to evaluating the benefits of creating a procurement sustainability competence centre to further support its procurement team.⁸

EXAMPLE: Sustainable Procurement Targets and Performance Indicators at Rijkswaterstaat⁹

Rijkswaterstaat, a Dutch infrastructure agency, sets and tracks sustainable procurement targets across six themes. It integrates these themes into procurement decisions, continuously monitoring progress and identifying improvement areas to meet targets.

Define new roles

You may need to augment supply chain management-related job descriptions and/or create new roles as you transition through your sustainability journey.¹⁰ For instance, this may include roles related to measuring and reducing Scope 3 carbon emissions, addressing human rights and modern slavery, and supporting circularity and waste reduction in your value chain. Clearly define these new roles in job descriptions and titles to reinforce that sustainability is now a core requirement.

Establish clear accountability for individuals

Implementing sustainability in procurement hinges on clear individual accountability.¹¹ To create accountability, you need to translate your organisation's sustainability commitments into personal goals for your procurement and supply chain team.¹² You also need to establish individual performance plans. These can help ensure your team is prepared to integrate sustainability into their everyday work and drive your organisation’s sustainability agenda.

To further drive behavioural changes, you can align KPIs and incentives with sustainability priorities. Consider including performance bonuses or senior management oversight for key sustainable procurement KPIs. Ensure that feedback sessions and performance reviews address individuals' contributions towards sustainable procurement and value chain initiatives. This could be through their innovative ideas, project execution, or efforts toward achieving sustainability goals. Additionally, consider individuals' efforts to drive sustainability initiatives during promotion decisions.

EXAMPLE: The City of Portland sets sustainability goals for procurement team members¹³

The City of Portland's Sustainable Procurement Program mandates sustainability training for each team member and includes sustainability goals in job descriptions. The program embeds sustainability into the procurement process by tracking metrics such as, greenhouse gases (GHGs), exposures to harmful substances, supplier diversity, and safe and fair labour practices.