What will it take for your company to establish a Sustainable Procurement Policy?

June 15, 2011 EcoVadis

Last week Greenpeace launched a global campaign against Mattel Inc. which effectively persuaded the largest toy company in the world to promise to establish a sustainable procurement policy. The campaign leveraged the face of Barbie, perhaps one of the most recognized dolls across the globe, to tell the story in 18 languages of how the Barbie packaging is sourced from suppliers which contribute to deforestation.

Mattel, who suffered from major supply chain issues in 2007 when lead was detected in their toys and who spent US $110 million on “reputation repair”, are in the spotlight once again. This time around they have been primarily leveraged as the face for the campaign, while the true target is one of the largest producers of wood products in the world, Asia Pulp & Paper (APP) and subsequently all the companies who source products from them including Mattel (of course), Disney, Hasbro, and Lego.

Greenpeace did a chain-of-custody and forensic analysis on the toy company packaging and was able to identify contents of mixed tropical hardwoods from the Indonesian rainforest, the homeland of APP, and a region that has been vastly deforested.

It is no easy task to ensure sustainable operations of tier-one suppliers and an even greater challenge when looking to tier-two and tier-three suppliers, but figuring out ways to make it happen is increasingly important, especially for large firms where reputation risks are monumental. Why Mattel did not establish a formal sustainable procurement policy after their first major supply chain issue in 2007 is somewhat hard to say. One reason may be found in the actions taken by their VP of Worldwide Operations, who apologized for blaming their Chinese suppliers, stating that many of the product recalls were also due to product design errors on Mattel’s side (due to small magnets, not lead paint issues). Another reason is that they were strictly focused on product safety in their supply chain, and rightfully so considering their product users are children, rather than on sustainable procurement as a whole.

The toy industry, much like the apparel industry, has focused firstly on improving social conditions of supplier factories, but ensuring supply chains are also environmentally responsible has not been a priority, which is why this campaign aims to goes after the industry, even if Barbie herself is the face. Disney offers the most extreme example of this as they have a full blown International Labor Standards Program with 60,000 assessments of factories done since 1996, but regarding the environment, they have only just launched a basic supplier self-assessment last year.

Even Mattel has stated this past week that, “it is not the normal course of business to dictate where [packaging] suppliers source materials.” Maybe it wasn’t normal business for them in the past, but it certainly is now, especially since every product they deliver contains packaging as a key component.

In a way, Mattel is actually quite fortunate as there is no need to reinvent the wheel when it comes to sourcing and tracking the chain of custody for paper or packaging materials. Compared with other materials, wood derived materials have perhaps the most mature systems in place in regards to certification schemes, frameworks and support for managing chain of custody ( i.e. FSC or PEFC).

And so, a promise has been made to implement a sustainable procurement policy with specific regard to paper sourcing, but we hope to see Mattel take this opportunity to go above and beyond. As for the other three deer caught in the headlights – Disney, Hasbro and Lego – action has yet to be taken.


This article was written by Nicole Sherwin, a CSR Analyst at EcoVadis. You can follow her on twitter @NicSherwin

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