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CPO Rising 2017 Summit Perspectives – Procurement with Purpose, from SAP Ariba

This year’s CPO Rising 2017 Summit featured exciting roundtable sessions where attendees got to exchange ideas and talk about innovative strategies to help improve the performance of their procurement department. In this article series, we look to our roundtable hosts, who captured thoughts and insights from the roundtable sessions they each hosted at the Summit.

Today we have a guest post from SAP Ariba, which hosted the “Procure with Purpose – Building an Ethical Supply Chain” roundtable at the Summit. This roundtable focused on how to leverage effective supplier risk management tools to drive supply chain transparency, minimize environmental, social and governance risks, change your company, and change the world. After all, there’s more to business than the bottom line.

Procurement with Purpose: Beyond saving money, the function can help improve lives

What is the purpose of business? The answer to that question is changing. In the past, most business leaders might say “to increase profits for shareholders and owners.” And while that is certainly still a major part of the equation, many companies are beginning to take on a higher mission to make the world a better place to live and work. To find new ways to solve the world’s most pressing challenges, and to commit to running their businesses with a purpose. And with good reason.

Doing Good and Doing Well

Research shows that purpose-driven companies with strong performance in environmental, social, and governance outperform the market by 4.8%. In other words, they can do good and do well. And procurement can lead the way.

With increasing frequency, companies are looking at whether they buy from suppliers who support people with disabilities or employ a certain number of women. They want to know that no slave labor is being used to make their products. They want to ensure that fair labor practices are in play across their global supply chains.

Purchasing with Purpose

Procurement is in a unique position to address these issues, and beyond just saving money, improve lives and make the world a better place.  Collectively, the Global 2000 spend $12 trillion on goods and services annually. By tying their purchases to purposes, these companies can take a stand and drive ethical behavior across the supply chain. And technology exists to make this possible.

Business networks, for instance, provide transparency and insights into supply chains that enable companies to ensure they are acting in ethically responsible ways.

Take SAP Ariba, the world’s largest business network. Leveraging historical and real-time purchasing data and supplier intelligence along with applications for data analysis delivered on the network alongside data and services from third parties like Made in a Free World, procurement can shine a light on the materials, regions, and suppliers that are most likely to have forced labor and take action to combat it.

Through a link between SAP Ariba Discovery, a global business matching service, and the ConnXus Database, buyers can tap a wider pool of minority-, woman-, LGBT- and veteran-owned businesses and enable global supply chains that are more responsible, sustainable and inclusive.

And through a partnership with Samasource, procurement can access intelligence on fair labor practices in impoverished regions and help their companies understand how they can drive fair labor practices.

There’s power in purpose. And it is the greatest power of all. It inspires us. It moves us. It enables us to reimagine and reinvent what is possible and achieve great things. And it is what will take procurement to the next level.

In the old days, the Chief Procurement Officer who said “I can save us three percent on our annual purchases and streamline our supply base,” rose up. But times have changed. Today, it’s the CPO who says “I can lift a man, woman or child out of forced labor” who ultimately moves forward.


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