10 Ways to Better Value Procurements - #6 - Ethics

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Institutions and companies that earn a reputation for good ethical behaviour will lower their business costs and gain customers. An institutional supplier will prefer to deal with institutions that do what they say they will do knowing that they will have a fair and equal chance of gaining the institution’s business. Similarly consumers will choose to patronize companies that offer products and services sourced in an ethical manner.

For procurement professionals good ethical behaviour is more than who buys lunch.

Traditionally good ethical behaviour is described by what does not happen. Persons in positions of trust do not benefit personally from their trust position through favouritism to individuals or companies. Sadly, this practice continues and we read about examples of bad ethical behaviour almost every day. The cost to business and reputation is enormous.

Today’s definition of ethical responsibility includes sustainability, fair treatment of workers and environmental responsibilities. Driven by citizen’s groups and fuelled by the power of the internet to reveal, business practices are changing in meaningful ways. “Greenwashing”, the practice making poorly substantiated claims of environmental and social responsibility, is not acceptable.

More and more companies and institutions are striving to build a reputation for superior ethical practices. To build and maintain a good reputation, supply chain professionals working for these companies are responsible for monitoring the practices of their suppliers on a continuing basis. Supply requests include questions about the sustainability of raw material extraction, labour practices in manufacturing, supplier business practices relative to material conservation, transportation and the effects of the purchased products on the local and greater environment. A visit to key supplier’s operating facilities can test the veracity of claims made. For enlightened companies and institutions the value of ensuring ethical responsibility across the supply chain exceeds its monetary cost.
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Other Posts in the series: How to Add Value to Your Procurements
• Be Proactive
• Analyze what is required – bring clarity to the specification
• Understand the supply chain
• Align procurement strategies with corporate strategies
• Apply the highest standard of ethics
• Use the right tool for the job
• Plan contract management before there is a contract
• Learn from what was done
• Mitigate procurement risks
• Utilize the skills of supply management professionals

Over the coming year, Rusty Joerin, guest blogger, will expand on the above. Your comments are welcomed.


Rusty James Joerin, C.P.P. is a Supply Chain Management Professional and accredited by the Purchasing Management Association of Canada as a Certified Professional Purchaser. He offers procurement services primarily to public sector organizations that do not have a professional supply manager on staff and provides additional capacity to assist with project related supply for those organizations with purchasing specialists on staff.
Information about his experience and qualifications may be found at:www.woodsgift.com