The Relationship Between ISO 20400 and Mining Procurement
Sustainable practices extend to procurement policies of firms. Companies are not islands. Instead, businesses operate in a global economy, where every business is connected to another business, in one way or another. Procurement forms an integral part of business operations in this environment. With the increasing focus on sustainability of operations, it is just as essential to address procurement processes of the company, as it also affects the firm’s impact on the environment.
ISO 20400:2017 is the new international standard that specifically focuses on procurement policies. It is also highly relevant to mining procurement policies and procedures. The standard provides an effective framework and guidelines for organizations, regardless of size or activity, to ensure sustainable purchasing. With the mining industry being especially concerned about environmental impact, safety, and the wellbeing of employees, mining houses that implement ISO 20400:2017, therefore, improve their procurement processes.
The standard is called ISO 20400:2017 Sustainable Procurement – Guidelines. It is a sector-specific application of a related standard, ISO 26000. Following the guidelines, it is possible to improve mining procurement processes and to integrate sustainability in the business buying processes.
Sustainable mining procurement entails decision making, regarding purchases of goods and services that benefit the organisation and the society, in addition to reducing the impact of the process on the environment. By following the guidelines, organisations are able to ensure that the work conditions of employees who work for suppliers are reasonable, products purchased from suppliers are sustainable, and that the suppliers address socio-economic issues.
The standard is aimed at top-level management and senior managers involved in purchasing. It provides guidelines regarding the strategic and political aspects of the buying process. It also addresses aspects, such as the alignment of procurement with the organisation’s goals for sustainability.
The standard provides an effective definition, regarding sustainable procurement principles, such as human rights, accountability for decisions, ethical conduct, and transparency in decision-making. It also places emphasis on aspects, such as risk management, and covers the entire purchasing process. Following the guidelines helps to ensure full integration of social responsibility with the mining procurement processes.
Advantages of Implementing the Standard
Implementation of the ISO 20400 standard helps the organisation to create sustainability. The organisation is able to make a positive contribution to the country’s economy and overall society. The organisation encourages stakeholders to follow the same principles, improve their social responsibility profiles, and reduce their impact on the environment. Supplier costs can be effectively managed, while respect for human rights is encouraged.
Implementation of the standard also helps the organisation to improve on performance, as it encourages clear communication between suppliers and receivers, organisations and contractors, and contractors and sub-contractors. It helps to synchronise the buying process through improving relationships with all stakeholders in the supply chain. This, in turn, helps to reduce risks, such as product failure. A standard is a valuable tool in optimising performance, reducing costs, and promoting innovation in the global economy.
Relationship with ISO 26000
The mining sector faces challenges, such as creating safe workplaces, reducing environmental impacts, improving worker conditions, and ensuring equality. As such, the sector benefits from widespread acceptance and implementation of ISO 26000, which forms the basis of ISO 20400.
ISO 26000 focuses on social responsibility, by addressing aspects, such as fair business and labour practices, and basic human rights. Implementation of ISO 20400 enables companies to integrate the principles of social responsibility, addressed by ISO 26000 in their procurement processes.
How to Get Started
Companies that want to get the most out of the standard, regarding their mining procurement processes, should start by examining their purchasing policies and culture. Questions, such as where they buy from, who they buy from, how much control they have over the risks of suppliers, what the demands are on their suppliers, and whether they have clear requirements of suppliers, must be answered.
Organisations should review their supply chains, and evaluate the costs to the company. Here, questions like what proportion of earnings is spent on paying suppliers, and whether the organisation knows what the impact of the supplier on society and the environment is, must be answered.
Strategic thinking is paramount when it comes to sustainable procurement. Get professional help with the auditing processes, implementation, training, and preparation for certification, by making use of our extensive range of services.