Environmental Management Systems in procurement processes: IS0 14001

In this step, you will be introduced to Environmental Management Systems (EMS) and the ISO 14001 standard.

Management has to be where the action is.

(Dieter Zetsche, former chairman of Daimler AG and Head of Mercedes-Benz)

Environmental Management Systems – sustainable procurement

According to Sroufe, an Environmental Management System is:

…a set of processes and practices that enable an organization to reduce its environmental impacts and increase its operating efficiency.

(Sroufe 2003)

Such systems can be also used to report environmental performance information to internal and external business stakeholders. Businesses can use a range of EMS to support their sustainable procurement and development policies (NHS 2018). Businesses must ensure that they and their suppliers have EMS processes in place (eg are ISO 14001 certified or use the GreenSCOR Model) to manage their business environmental impacts, such as waste production and recycling rates, energy and water usage, travel, greenhouse emissions, and impacts on the natural environment and biodiversity.

ISO 14001

ISO 14001 is:

…an internationally agreed standard that sets out the criteria for an environmental management system. It maps out a framework that a business can follow to improve their environmental performance through more efficient use of resources and reduction of waste.

(ISO 2015)

According to an Airbus report published by the European Commission (ACADEMY n.d.), the following steps must be undertaken to include environmental aspects in the procurement process:

Step 1: Call for tender and supplier selection

  • Define environmental criteria for the selection of the supplier
  • Include those criteria in the selection report

Step 2: Supplier contracting

  • Define and implement a series of contractual requirements in line with the business’ environmental policy and objectives
  • Introduce environmental requirements in the purchasing contracts (eg as a contract annexe)

Step 3: Supplier monitoring

  • Assess the supplier’s ability to control potential environmental impacts
  • Assess the supplier according to the environmental requirements defined
  • Establish a continuous improvement indicator to measure the supplier’s environmental performance

ISO 14001: Integrating environmental criteria into the supplier selection process

Humphreys, Wong and Chan (2003) identified a range of environmental criteria that can be considered during a supplier’s selection process. They classified them under two categories: quantitative and qualitative.

Quantitative criteria Qualitative costs
May include direct costs of material, equipment, energy, scrapping and disposal, or the costs of environmental externalities (eg emissions) May include the costs of selecting suppliers with management competencies (eg be trained, willing to exchange information), a strong ‘green’ image (eg with large market share, network and purchasing retention), environmental designs in place (eg reuse, recycling, remanufacturing, disassembly and disposal plans), environmental management systems (eg are ISO 14001 certified), or having a range of environmental competencies (eg clean technologies, environmentally friendly materials, pollution reduction capabilities and returns handling capabilities)

References

ACADEMY (n.d.) ‘Environmental Requirements for Suppliers and Management of the Supply Chain’. Airbus Corporate Answer to Disseminate Environmental Management System (ACADEMY). Eco-Efficiency and Sustainability. G7, (1)

Humphreys, P. K., Wong, Y. K., and Chan, F. T. S. (2003) ‘Integrating Environmental Criteria into the Supplier Selection Process’. Journal of Materials Processing Technology 138 (1-3), 349-356

ISO (2015) ISO 14001. Key Benefits. International Organization for Standardization (ISO) [online]. available from https://www.iso.org/publication/PUB100372.html [9 July 2019]

NHS (2018) Sustainable Procurement Procedure (SH NCP 70). Southern Health, National Health System (NHS) Foundation Trust

Sroufe, R. (2003) ‘Effects of Environmental Management Systems on Environmental Management Practices and Operations’. Production and Operations Management 12 (3), 416-431

Share this article:

This article is from the free online course:

Sustainability and Green Logistics: An Introduction

Coventry University