ESADE Knowledge report   If companies want to become greener, they should take a closer look at their purchasing departments. A recent study published by ESADE's Professor Cristina Gimenez Thomsen, in collaboration with Professor Rudolf Large from the University of Stuttgart, reveals how purchasing departments play a crucial role in improving environmental performance in companies.   The study, published in the Journal of Purchasing & Supply Management, analysed data from the purchasing departments of over 100 German companies, from sectors such as the automotive industry, the mechanical engineering industry, and the electrical and chemical industries. "We analysed the purchasing departments of these companies and studied whether or not their actions had contributed to improving environmental performance," stated Gimenez.   Purchasing departments have usually been a tactical area in companies, their role traditionally being limited to choosing providers and processing orders. It is only in recent years that purchasing departments have started to fulfil a more strategic role in companies, to the extent that their contribution to making businesses' performance greener is now acknowledged. "We found that two approaches taken by purchasing departments in managing their relationships with their suppliers -green supplier assessment and green collaboration with suppliers- were contributing to the improvement of environmental performance in companies," explained Gimenez. Green supplier assessment refers to the role of purchasing departments in choosing suppliers recognised for their environmental or green commitments and in encouraging their current suppliers to be greener through specific recommendations, as well as undertaking green audits. The second key factor, green collaboration with suppliers, means helping the supplier to become greener by actively contributing towards solving environmental issues together.   The paper also shows that the following three factors enable the implementation of both approaches, supplier assessment and green collaboration with suppliers: (1) the participation of the purchasing department in the firm's strategic planning process, (2) the company's environmental commitment, and (3) the training of employees on environmental issues. "Employees in purchasing departments should be offered training to develop the knowledge and skills for buying environmentally-friendly products and establishing green collaborations with suppliers," Gimenez explained. A recent survey by KPMG (2011) shows that despite the increasing relevance of environmental sustainability, putting this concern into action continues to be a difficult task. The results of this paper invite reflection on the role purchasing departments play within companies in terms of improving environmental performance.Original Article: Large, R. & Gimenez Thomsen C. (2011). "Drivers of green supply management performance: Evidence from Germany", in Journal of Purchasing & Supply Management, Vol. 17, issue 3, 09/2011, p. 176 - 184.

<< Back to home