PROCUREMENT laws and regulations have evolved significantly in recent years partly due to increasing demand for information about the origin and conditions under which products are manufactured in the downwards supply chain and disposal and waste in the upward value chain.
Sustainable procurement has therefore become a priority for many organisations as it benefits not only the organisation itself, but also the larger economy and the environment. To comply with regulations and to institute responsible supply chain practices, it is important to establish formal industry standards and guidelines which take into account ethics, as well as common social and environmental concerns.
Engaging with the supply industry and encouraging greater collaboration is the best way to achieve this. By taking this approach companies will have a common vision to help them achieve better social, economic and environmental outcomes. They will also be inclined to adopt responsible business practices with regards to ethics, labour, health and safety, and the environment.
In the rail industry, it became necessary to create an initiative that brings together major rail actors in order to formalise, implement and incorporate responsible supply chain practices throughout the value chain. This synchronisation would help suppliers to meet industry expectations and demonstrate sustainable performance.
In March 2015 six railway companies - Alstom, Bombardier, German Rail (DB), Knorr-Bremse, Netherlands Railways (NS), and French National Railways (SNCF) - launched Railsponsible, a non-profit business membership organisation to promote sustainable procurement across the industry supply chain.
The agreement was formally signed at NS’ headquarters in Utrecht, where corporate purchasing officers (CPOs) of the member companies signed a charter of responsibility for ethically, socially, and environmentally sustainable business practices in their operations.
Railsponsible has opened up a forum for exchange, discussion and engagement on the greenest, most ecologically and socially responsible procurement practices within the railway sector. On July 1 a seventh member, SKF, joined the initiative, which remains open to all organisations in the railway industry which want to be part of a community that promotes responsible supply chains and better business conditions.
During the first year of the initiative, Railsponsible was chaired by Mr Jeroen Wegkamp, CPO of NS and on April 1 this responsibility was passed to Mr Olivier Baril, CPO of Alstom.
“My goal through Railsponsible is for Alstom to reinforce its partnership with its suppliers and together improve corporate social responsibility (CSR) performance,” Baril says. “This collaborative work will benefit the whole rail sector supply chain and contribute to increased productivity, a reduction in costs while promoting the development of more sustainable products and solutions.”
Alstom believes that Railsponsible is a positive initiative that encourages sustainable procurement and sets a common ground for climate-friendly business procedures. Alstom is committed to creating sustainable transport solutions and to ensuring that social and environmental concerns are fully taken into account in all of its activities and in its relations with suppliers and customers around the globe.
It is particularly important to consider these criteria during the procurement phase. At Alstom, procurement is based on an objective assessment of the supplier’s reliability and integrity as well as on the overall value of their offerings. Alstom’s suppliers are required to sign a charter for sustainable development, which is underpinned by respect for human rights, prohibition of child labour, employee health and safety, and ethical rules regarding anti-corruption, competition compliance, environmental protection and compliance with applicable laws and regulations. Furthermore, Alstom makes sure that these commitments are met during the selection process as well as during the execution of the contract.
Railsponsible members gather regularly throughout the year, during which time they openly share their best practices and processes and work to extend the reach of corporate responsibility and sustainability.
Railsponsible is supported by two committees:
- the membership committee comprising sustainable sourcing directors and managers which will develop and execute the annual work plan as well as enact the strategy, and
- the leadership committee, which is made up of CPOs, and ratifies the decisions made by the membership committee as well as provide oversight, strategic guidance and insight. The leadership committee is the official external representative of the Railsponsible initiative.
To achieve its ambitions, Railsponsible relies on the support of BSR, a global nonprofit organisation which develops sustainable business strategies and solutions, and EcoVadis, a collaborative platform which provides sustainability ratings for suppliers working in global supply chains. This partnership brings valuable expertise in collaborative industry sustainability initiatives, as well as sustainable procurement collaborative platforms. Their support will also help to comprehend today and tomorrow’s stakes regarding CSR in the rail industry.
Evaluations of a supplier’s environmental, social and ethical practices and are based on the United Nations Pacte principles, the ISO 26,000 Norm and the Global Initiative Reporting. Since the launch of the initiative, 1165 suppliers have been invited to be assessed through the EcoVadis collaborative platform, with more than 460 assessed so far, with the average rating far higher than the average of all companies assessed by EcoVadis.
Railsponsible’s immediate ambition is to promote and reinforce the initiative and to welcome more members. The body is also striving to further simplify the assessment processes for suppliers and to make CSR one of the key selection criteria in the tendering phase.
The next Railsponsible initiative meeting will be held at InnoTrans 2016 in Berlin. Most of Railsponsible’s member CPOs will gather for a discussion at the European Railway Industry Association (Unife) stand on September 21. During this event, the CPOs will present Railsponsible’s achievements over the past year and outline its strategy up to 2020. A ceremony to award CSR best-in-class suppliers will also be held.