Procter & Gamble, makers of such classic brands as Tide, Bounty, Dove and Duracell, is giving its suppliers a sustainability ultimatum: start measuring your carbon footprint, or your outa here!
On May 12, P&G launched a Supplier Environmental Sustainability Scorecard and rating process designed to measure and improve the environmental performance of its key suppliers. The scorecard requires them to set a benchmark and then set annual improvement levels for things like energy use, waste disposal, water use and greenhouse gas emissions.
P&G is hoping that other companies will follow their lead and is making the scorecard available for other companies to use.
The scorecard is the latest strategy in P&G total commitment to environmental sustainability. The company believes that sustainability is a profitable strategy which will not only be good for the environment and save the company but also help them gain the loyalty and trust of more customers “in more parts of the world more completely,” says Bob McDonald, chairman, CEO and president.
The scorecard was developed over 18 months with input from their Supplier Sustainability Board, which includes more than 20 of P&G’s leading global suppliers. The scorecard follows the standards and protocols of the World Resources Institute, the World Business Council for Sustainable Development and the Carbon Disclosure Projects.
Suppliers will have one year to prepare before they will be penalized for non-compliance.
P&G is not the first organization to make such a supplier request. Unilever developed one specifically designed to reduce deforestation caused by its palm oil suppliers. In addition, Walmart has had a supplier sustainability scorecard for a few years. However, Walmart’s supply chain sustainability requirements do not include advertising agencies while P&G’s does. Conversely, Walmart’s scorecard includes measurements on diversity and community involvement, while P&G’s does not.