Sustainability and Supplier Data: EcoVadis, Healthcare Firms Share Information for ‘Responsible Health Initiative’

The issue of sustainability has increasingly become a topic that has the power to unite industries in which peers might otherwise find themselves in fierce competition.

According to an EcoVadis statement, industry concerns about sustainability have made supplier data, which was once considered proprietary, become a shared resource for creating impact and cross-company value.

EcoVadis provides sustainability risk and performance ratings for global supply chains, and the company evaluates nearly 20,000 companies every year regarding corporate social responsibility (CSR) based on their environmental, human rights and ethical performance, according to Sylvain Guyoton, senior vice president of research, stated in a story about anti-corruption efforts.

EcoVadis and three health and pharmaceutical companies — GlaxoSmithKline (GSK), Teva, Takeda — this year announced the launch of the Responsible Health Initiative (RHI).

EcoVadis, which manages the initiative, states that RHI’s mission is to bolster the use of collaboration and technology to improve the visibility, efficiency and sustainability impact of the global health supply chain.

“As business models across the health and pharmaceutical industries continue to evolve and overlap, it makes sense for organizations to focus on shared needs, goals and opportunities in sustainability, and act on them through the collective industry supply chain,” said Pierre-Francois Thaler, co-CEO and co-founder of EcoVadis.

Thaler explained that peer collaboration is considered to be a proven model for enabling companies in any sector to facilitate sustainability performance measurement and extend visibility.

“We are confident the Responsible Health Initiative will help create the networked impact the healthcare industry needs,” Thaler said.

David McClintock, EcoVadis’ marketing director, said the company is seeing a trend of industry collaboration regarding sustainability across the board.

“From the Responsible Health Initiative, Railsponsible, AIM-Progress, Responsible Beauty Initiative and more, companies are increasingly working with peers in their sector, rather than independently, to create common standards, tools and platforms that enable suppliers to quickly fill out CSR surveys,” McClintock said.

Saving Time, Sharing Value

He explained the appeal of this new system. Rather than having to fill out and submit several surveys for each buying organization, McClintock said suppliers now only have to go through the process once.

“The survey gets shared with everyone in the collaborative group,” McClintock said. “Harmonizing methodologies and creating and sharing best practices in this way increases efficiency, transparency and visibility in companies’ supply chain operations and creates mutual value.”

The effort is intended to boost shared value across the industry’s supply chain by enabling key members of the global health sector to improve not only their own sustainability performance, but also that of the industry’s group of suppliers as a whole, EcoVadis stated.

A goal of implementing the RHI initiative is to implement positive change gradually throughout the industry, McClintock said.

“By taking meaningful actions in a pre-competitive way — such as sharing best practices, workshopping challenges with multiple members across different categories, leveraging agreement of processes and more — positive impact trickles throughout the entire sustainable supply chain,” he said.

McClintock points to similar projects like that of Together for Sustainability, a joint initiative of chemical companies founded in 2011 and managed by EcoVadis, as an example of a similar initiative that paved the way for collaboration within a sector.

The health initiative will be powered by EcoVadis’ platform and scalable methodology, which representatives say provides for transparency and insight into supply chain CSR practices.

Leveraging Digital Sustainability Intelligence

“Being part of the Responsible Health Initiative will help us leverage digital sustainability intelligence to more effectively select and partner with suppliers who share our values,” said Val Monk, head of ethics and risk programs at GSK.

The goals for the RHI includes:

• Harmonizing industry standards for online CSR assessments, with dependable indicators and global reference points.
• Implementing a common platform to streamline the sharing of CSR performance among suppliers, third parties and RHI members.
• Using shared tools to enhance supplier engagement and improvement plans.
• Collaborating to minimize risk and improve visibility in the supply chain.

EcoVadis adds that member organizations in the RHI will be equipped to access sustainability potential throughout the industry supply chain, identify high-performing suppliers and best practices, reduce operational disruptions, mitigate risk, and drive value with suppliers.

The RHI is now the sixth sector collaborative managed by EcoVadis, the company said.  The initiative will require efforts to learn from other industry efforts in account, including that of Together for Sustainability, Railsponsible, AIM-Progress, Joint Audit Cooperation (JAC) and the Responsible Beauty Initiative.

“One of the benefits of an initiative like Responsible Health Initiative, Together for Sustainability, Responsible Beauty Initiative and others is that it proves and creates a positive perception of the industry overall,” McClintock said. “Investing in sustainability in this way drives tangible improvements for the entire sector and builds value beyond each company’s individual business to their entire network of suppliers,”

McClintock said that facilitating such a positive image reflects on all companies involved.

“It’s great for all the organizations part of the collaborative, as it helps shape the industry brand by sending a message that they, as an industry, are sustainable,” he said.