EcoVadis was recently chosen as an independent third-party solution provider for the new “Responsible Beauty Initiative,” which is a procurement initiative created by four European leaders in the cosmetics industry (Clarins, Coty, Groupe Rocher and L’Oréal) as well as all of their suppliers.
Forming an industry-wide initiative on the EcoVadis platform represents the most mature phase of this collaborative effort: A group of companies in the same business sector, whether at a European or International scale, comes together and shares tools for assessing and improving ethical, social and environmental practices within their supply chains.
Shared CSR assessment is a first step
“When you realize that 50 to 70 percent of the impact that companies have on society and the environment stem from their supply chains, it is easy to see the challenge facing such initiatives. We know that these global industry-wide initiatives are a powerful tool for accelerating the CSR (Corporate Social Responsibility) performance of supply chains. Besides the time and money saved by combining efforts, they often allow businesses to stay ahead of changes in regulatory requirements. This type of arrangement takes time, and it is our duty to devote resources to it and assist the companies.”Pierre-François Thaler, Co-Founder and Co-CEO of EcoVadis
Besides CSR assessment, the collaboration between companies within the same industry is a powerful managerial tool for accelerating the progress of ethical, social and environmental performance among all companies in a supply chain.
From combining educational, informative and preparatory actions to anticipating regulatory requirements like the imposition of corruption prevention and control plans, joining together through industry-wide initiatives speeds up processes. For example, the association AIM-Progress, in its late-2016 report, announced that one-third of its members had no system in place to address the “UK Modern Slavery Act” when it became law in 2015. By late 2016, 92 percent of its members had compliant procedures. Over the same period, 90 percent of its members had also incorporated environmental objectives into their procurement processes. The AIM-Progress initiative also successfully hosted regional events, like the latest October conference aimed at Southeast Asian suppliers, primarily in Malaysia, designed to facilitate peer-learning and information-sharing around regulatory compliance and other core supplier challenges. All these methods contributed to sustainability performance improvements.
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The EcoVadis platform now hosts six industry-wide initiatives, supported by multinationals that share their suppliers’ CSR assessment results.
- 2011: Together for Sustainability (TfS) was started by six major companies in the chemistry sector worldwide. TfS, including Borealis’s recent participation, now has 20 multinationals and five years of experience to draw from.
- 2013: Electronics – Tool for Accountable Supply Chains (E-TASC) includes 14 companies that are members of the international association Global e-Sustainability Initiative (GeSI) and aims to improve CSR performance in the Information and Communication Technology (ICT) sector.
- 2015: Railsponsible is an industry-wide initiative centered on nine players in the rail industry with a target of covering 60 percent of procurement spend.
2017 has seen the launch of three new industry-wide initiatives on the EcoVadis platform:
- AIM-Progress was the first voluntary assessment pilot including six consumer goods companies drawn from the 42 multinational FMCG members.
- Pack2Go Europe leverages the association to assess social and environmental practices in the manufacturing processes of the top 20 manufacturers of food packaging.
- Ending the year on a high note, the recent launch of RBI brought together suppliers and subcontractors for four major companies in the cosmetics industry, Clarins, Coty, L’Oréal and Groupe Rocher.
Industry-wide initiatives might be just what suppliers are waiting for
In all industries, companies of every size are already engaged in improving their environmental and social performance and are mindful of business ethics issues. The latest EcoVadis/HEC 2017 Sustainable Procurement Barometer showed that less than half of suppliers surveyed (44 percent) perceived their customers to be committed alongside them in improving the environmental, social and ethical performance of supply chains. Among them, only 21 percent felt genuinely encouraged in the improvement of their own environmental and social practices.
Those companies would be the largest beneficiaries of an industry-wide initiative around CSR practices in their sector.
Don’t just take it from us
As a representative from German small business Harting put it: “These days, our customers care as much about sustainability as they do quality and price. They ask us questions and verify how we implement our ethical, social and environmental principles and objectives. The EcoVadis platform offers a good solution for companies in the rail sector. The assessment provides two benefits: First, it gives us an industry benchmark, and second, we truly appreciate the recognition we get for our CSR approach, especially when it’s the top CSR award from Railsponsible!” Harting was named the 2017 winner of the Railsponsible Supplier Awards.
The Alten Group also described its approach to CSR performance, saying “It’s something you need to believe in. People really need to be motivated, and take the matter personally. Our engineers are quite proud to be recognized as among the best in our industry. What we care about is both the rating AND our position relative to others. Another thing that motivates them is making the connection between that assessment and the concrete actions taken, so that they really understand.” The Alten Group was selected in 2017 as leader in the “Tertiary Services” category of the GeSI E-TASC Leadership Index.
Although the EcoVAdis assessment standard can be adapted to any company – based on its size (XS/S/M/L), sector and locations – each industrial ecosystem has its own unique features, ongoing events, culture and way of doing business. Coming together on a shared platform makes it possible for industries to go beyond compliance. As assessment is only part of the process, the more industry players form connections with one another and organize around a shared CSR management system and tool, the better the results are, with positive impacts for everyone in the long term.
Want to learn more about how CSR Ratings can reduce risk and drive improvements in your business and/or industry? Contact us to arrange a consultation, see the demo, or get a quote.
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