P&G announced on May 12, 2010 the launch of the Supplier Environmental Sustainability Scorecard and rating process, another important Sustainable Procurement initiative in line with Wal-Mart’s “Sustainability Index” or IBM’s new CSR requirements for suppliers.
P&G’s Supplier Scorecard is designed to measure energy use, water use, waste disposal and greenhouse gas emissions of key suppliers. The company wants to encourage year-on-year improvement of suppliers by implementing this Scorecard and rating process, and also incite suppliers to use the scorecard within their own supply chains.
According to P&G Chairman of the Board, President and Chief Executive Officer Bob McDonald: “The launch of the Supplier Environmental Sustainability Scorecard represents the next step in P&G’s commitment to environmental sustainability and reflects the Company’s holistic, end-to-end supply chain strategy”. P&Gs Global Purchasing Officer (Rick Hughes) also summarizes the objectives in a video.
P&G also decided to make the scorecard “open source” and you can download the scorecard here. Contrary to Walmart whose scorecard contains 15 very simple “yes/no” questions, P&G is trying to go much further, by developing a quantitative assessment of suppliers’ environmental footprint.
P&G also announced a target to go beyond and beyond suppliers overall Sustainability indicators but also report on « Sustainability results relating directly to the creation of P&G-specific materials and services ». From what we know of the maturity of suppliers reporting system, this is an extremely ambitious goal and it will be interesting to see how many suppliers are able to provide such indicators in a credible way.
Although the results of the scorecard won’t affect adversely suppliers before a year, this announcement will certainly have a far reaching cross-industry impact, urging suppliers to take seriously into account environmental issues.
The strategic initiatives launched by Walmart, IBM and P&G (and more are coming keep posted) illustrate the profound change in the industry practices, moving from traditional auditing methods (factory site audits, based on social and environmental compliance) to a much more strategic assessment of the suppliers CSR management system. EcoVadis has been pioneering Suppliers CSR rating for the past 3 years, and we welcome those initiatives which confirm our vision.