As domestic and EU regulation tightens, companies across Europe are increasingly coming to regard sustainability and procurement as two sides of the same coin. The ability to leverage ESG intelligence, best practices, and network effects is becoming the "new normal" and, without it, companies struggle to maintain competitiveness.
An Evolving Regulatory Landscape
The ground is shifting - again - for procurement in terms of the environmental, social and ethical performance of value chains.
From Germany and France, to the UK and the Netherlands, a torrent of new supply chain regulations are mandating that companies adhere to extensive due diligence and reporting requirements for which most supplier “compliance programs” are fundamentally ill-equipped.
The forthcoming Norwegian Transparency Act will impose extensive new due diligence obligations on firms employing as few as 50 full-time staff, while on February 23, 2022, the European Commission published its proposal for a comparable, EU-wide scheme. Furthermore, the record-breaking flow of capital into ESG-focused funds globally demonstrates that investors have long since come to regard sustainability risk and capital risk as one and the same.