Episode 82 - ISO 20400 – Reflections from Australia with Tanya Harris

Tanya Harris has a perspective on ISO 20400 as a member of the Australian delegation that developed it, as a procurement professional, a consultant and most recently as Head of Sustainability. She shares her thoughts on this “must listen” Podcast.

For more information go to https://www.iso20400.org/

Transcript

Copy Transcript Copied

SPEAKER_01 0:15

Welcome to Sentinel Sustainability. I'm Sean McCarthy, Director of Action Sustainability Community Interest Company. This is one of a series of several podcasts where we're talking about the ISO 2400 standard with people around the world who have used the standard and have deep experience in it. So I'm delighted to welcome today Tanya Harris from Australia. Welcome, Tanya.

SPEAKER_02 0:38

Thanks so much, Sean. Delighted to be here.

SPEAKER_01 0:41

Okay, first of all, Tanya, tell us about yourself, a bit about your background, how you became involved in sustainable procurement and what you do now.

SPEAKER_02 0:51

Okay, fabulous. Thank you. So I am a ex-traditional procurement practitioner, having worked in private sector, international development, and supporting public sector for around 25 years in some kind of procurement contracting type of role. I've been now working in or trying to figure out how to operationalise sustainability concepts in procurement processes and down the value chain for about 18 years. And I became involved in sustainable procurement back in 2008 when I was working for a telco, and they started reporting externally in their integrated CSR annual report using the GRI as the standard, and supply chain is a great big gap. And they came to the procurement team and said, Oh, we'd like to look at sustainable supply chain for reporting. And I held my hand up and said, I'd I'd love to participate. And I'd seen one of the customers had sent a really detailed due diligence trying to assess our capabilities. And with my procurement lens, I thought, well, you know, it's very easy to provide a policy that doesn't actually provide the risk flag or the level of maturity and capability within the organization. We can easily provide a policy, it doesn't mean that we're delivering that. And so in 2008, it was like, well, there's got to be a better way. There's obviously other jurisdictions in which people were practicing. And so I was able to go to the 2009 Climate Change Conference, COP15, in Copenhagen, and uh speak to some of the European telcos around how they were already implementing aspects of sustainable procurement, and they very graciously provided me their time. And at that point in time, it was really focused on IT procurement, particularly, I think BT were very, very generous in sharing. And so I came back to Australia and continued to develop a framework and a category management strategy. And subsequent to that, I went to an international development agency and found out that there was a national stakeholder engagement process because there was a brand new ISO standard being developed called ISO 2400 Sustainable Procurement Guidance and helped establish successfully the Australian Technical Committee and participate in the development of that over the years and meet fabulous international colleagues like yourself, Sean, and help actually codify and professionalize and have a consistent approach to sustainable procurement. So have been doing that for a wee while.

SPEAKER_01 4:07

Brilliant, thanks, Tanya. That's really interesting. And yes, obviously we met, you turned up in London as uh as part of the Australian delegation, as I remember, took London by storm when uh when we first met and you first started to get involved in the standard. And that was really interesting because the whole I remember you asking me when we first met, well, you know, how many people in this room were actually procurement people? Um, and there weren't many. There were a few of us, but there weren't very many. It was good that there were a lot of other disciplines and a lot of other professions involved to uh uh to build consensus and to build understanding. But it's uh one of the things that I'm hearing from a series of these interviews and one that I was doing earlier this week, it is all about procurement at the end of the day. And as you say, a lot of people are starting to wake up to scope-free emissions and to the you know the ethical risk in the supply chain. Um, so I think it's really helpful to have people like yourself with a procurement background that actually get procurement because procurement people can be a bit weird sometimes, and they you know well, they can kind of they they you know, kind of you know, I'm a procurement kind of background as well as you know. Um, and we do see the world in a certain way, and it's quite black and white. It's it's contracts, it's KPIs, it's specifications, it's terms and conditions, and all of those things, whereas actually, you know, you you've crossed the line, and I did many years ago as well, to be a sustainability person, and in that sense, then you're dealing with quite abstract concepts. And I yeah, I remember in the early days of doing this and trying to engage with these environment people, uh, and it was really difficult to understand them, and for them to understand me when I'm asking questions like, what do you want my supply chain to do? Well, it's terrible, we must save the world, you know. Okay, what do you want to do?

SPEAKER_02 6:14

And that's what I loved about ISO 2400 because when we were talking about risks, so procurement speaks in commercial terms. We the function by necessity is a control to mitigate risk, but also to optimize commercial outcomes, right? And that's the core function. And when you're looking at how do you protect vulnerable people in the supply chain, or how do you identify this is a fantastic circular economy opportunity, the our ISO 2400 redefined risk and opportunity, which we've now seen cascade through all of the mandatory financial disclosures, is issues, risks, and opportunities. And ISO 2400 was the first to introduce a marry risk and opportunity, and not just from a business or or or buyer perspective, it's around the risks and opportunities in the ecosystem, including the people and the value chain beyond your contracting direct entity and below. I I think that that was fascinating. I think we often forget to reflect on how much innovation ISO 2400 brought at the time. And I think it's really worth celebrating. And it also demonstrates the applicability to operationalise when you and I would love maybe this is something that we could uh do with AI is to actually scrape how many different levels of government, how many organisations. I know here in Australia, ISO 2400 is embedded or underpins their approach to procurement. It is it is significant numbers, and I think that that says a lot about the standard as well.

SPEAKER_01 8:04

Yes, it certainly does. I remember the endless debates about risk and opportunity because the one of the earlier drafts just that risky that and yeah, we were going through you know doing a word service to find every single risk word that had and opportunity, and that that was a massive debate. But I think you're right, very important because uh it was all about risk in the early days. You know, for me, the only way that I could sell sustainable procurement in the 90s, early 2000s was to talk about risk because that's the only thing that the business understood. I think we've moved on a lot since then.

SPEAKER_02 8:46

Well, I think that perhaps the broader business landscape understands um risks and opportunities. However, I don't think that the perception of what procurement is there to deliver has quite caught up with that, and particularly sustainability topics as an opportunity, as a long-term resilience almost fundamental requirement. I still don't think that procurement has been elevated to the critical importance it is to be able to deliver. And in part, I think that might be about practitioner adoption and communication of risks and opportunities. I also think that the profession has evolved somewhat from when both of us were practicing. It seems like it's much more segmented into you know, running tenders, contract management and relationship management is in a different part of the business. And so the breaking down of the component parts of a supplier lifecycle or a commercial agreement lifecycle has meant that the opportunity for procurement to really embrace understand. While I still think category management and portfolio management is absolutely one of the best levers, it's also missing that piece around well, the contract management, performance management, and that shared value opportunity that it brings. But that might be a little bit philosophical and skipping ahead.

SPEAKER_01 10:30

That's fine. I'm going back to my next question, then which I think you've kind of answered. But what was it that made you want to use ISO 2400? I mean, I guess because you were part of the committee, it's kind of the answer is fairly obvious. But uh, what you might want to draw on is is maybe because you you have experience both as a consultant and as a uh a practitioner. So maybe you might want to look at that from an angle of some of your clients from your consultancy dates.

SPEAKER_02 10:58

Yeah, yeah. Um, so and maybe if I start with coming in at ground zero, so uh I in-house I have established the sustainable procurement framework and implementation with nothing else in three different, very different types of organizations. And one was prior to the standard, one was whilst it was being developed, and now post. And I think from a practitioner, my fa and my favorite part of the entire standard is the annex A at the back, because what it does is it maps a sustainability topic to procurement's role and action. And when I tell people, if you need to know how to talk to procurement about sustainability, use annex A. Like I think it's it's exceptional. And I obviously a little bit biased. The procurement process and integration of sustainability into the procurement process was written by practitioners, and I think that's really clear because it's very practical. It talks to the very familiar plant source management methodology, it talks to the substeps within that, how it can be compressed. But what I've found when actually engaging internally, and I remember top management, I think it's such a strange term, but setting the organization up for success to enable sustainable procurement, that is, I have never seen it not 100% accurate. If you don't have top management on board, if you don't have explicit accountability, then there's a cascading effect to the success of the implementation and also the cultural change that is required to be able to deliver it, as well as the understanding of the insights or even the actions that are being asked of different groups to deliver that. And while, and I was reflecting in advance of the podcast, I don't think I've ever actually handed out the ISO to a C-suite CFO or whatever, and said, here, have a read. And I've never, and while we were very clever and crafting, this is for top management, this is for everyone, this is for procurement people, I have never actually successfully been able to have someone read that part. However, what it did was it gave me the insights, and particularly when I didn't have the same level of experience and maturity with engaging senior stakeholders, to be able to articulate the importance of why. You know, when we're looking at how we implement, everyone needs to be able to go, I understand this connection to my day-to-day, and there is a very clear why. And I think the the earlier chapters of of ISO say that in such a digestible and accessible business language, and I think that they are absolutely worth the well, the pages um that they're written on. So I found that really useful. When I look at international development and the countries that I have implemented aspects of sustainable procurement, so worked across 25 countries, but if I look at specifically some of the really heavy lifting where ISO 2400 was was utilized, um, there's a couple of countries in Africa. One was around a Ministry of Health and their entire medical procurement team. So, how could they integrate concepts of sustainable procurement? And so it was actually the procurement uh integration into the procurement process that they found really useful. They there was no need to explain the why. They were procurement practitioners, certified, you know, with the global professional bodies, and they could understand how they could practically implement that. In another African country, after multiple panels had been appointed for a three-year term, I did an introduction to the agency and why we had asked some sustainability questions and explained what those sustainability topics meant. But ultimately, the selling point and the reason why they were really engaged was because talking about if you want to sell to Western or developed nations, these are the things that will help you because these are the things that we're looking for. And if you can explain how you look, you have community impact and community benefits, then that's going to give you a higher weighting. So you could consider this next time you are responding to a tender, and that worked really well. And then if I look in Southeast Asia, building a hospital and doing a construction tender, integration of sustainability elements was really challenging, and it was particularly around material type, needing to have evidence, and also trying to then get some kind of calculations and particularly emissions out of it. And that was perhaps the hardest sell because the political and business environment was very culturally different, transparency, and so at the time my local team they they did their very best and they asked questions, but it perhaps didn't land as well as what it could have. So ISO 2400 bought um in in practical terms from an implementation, it was really useful and it depended on the stakeholders, it depended on the suppliers, and it depended on the maturity of the individuals that I was working with. From a consulting perspective, it's it's a repeatable, consistent process. It is really clear. If we're looking at the risk mapping, risk and opportunity mapping that's associated with a category that then informs the next steps. So even from the planning process, it's very easy to be able to understand sustainability. People love it because it's all this is my in for the supply chain. And so I found the construction industry was perhaps the most advanced, and that might be a reflection of the Australian market. But we do have things like the Green Building Council and Green Star, so the building codes that have it as a voluntary unit for certification. And so, depending on the ambition of the clients, we were able to do some really, really interesting projects where we helped develop the sustainable procurement framework. We defined the issues and risk category map, including materials for the client, and then they cascaded that down to their head contractors who then built the procurement plan and then cascaded the category risk and opportunity heat map down, and it was implemented through the procurement plan. So it was one of the best practice examples where I've seen cascading from asset owner down to head contractor down to subcontractors or key project managers, and it was brilliant because it was using you know the asset owners already defined procurement approach, and it wasn't asking the sub-tiers to come up with their own risks and opportunities. It's we've already done that work, we've agreed this. What we want you to do is to identify how we practically implement that, what are your existing practices, and then that defined the procurement plan, which then was able to be cascaded down further to subcontractors. And it was also a really good education tool as a part of that supplier engagement process. Unfortunately, I didn't see the end of the project because they do take years, but I thought that that was one of the most interesting examples where I've seen that cascading effect and the use of the standard to inform the framework and down.

SPEAKER_01 19:25

Thanks, and a number of issues and things that you said uh strike a chord there. Certainly, as I think you've ever given the standards to anybody to read, absolutely not. There's 50 odes of it. Really legit. I remember in in the very early days I attempted to write like an eight-page guide, and also, of course, we've got the the self-assessment now on the uh on the website that people can use. I think you know, as we were going through the process, it did just seem to get longer and longer based on people's input. But uh it was a good process, and I think, as you say, there's a lot of stuff in there that's valuable. It's not a page turning, you know, you're not going to sit down and read the whole thing, start from page one and go to page 52 or whatever it is, and expect to understand it. But you have picked out some uh really interesting specific issues, some of which I've heard quite a lot from because I've done a few of these interviews now. So people do talk about the why, and that was so important that we got that message across. And I I do remember in some of the early sections of the standard, there was, I think it might have been before you joined because the the Australian delegation were all about we need to tell people why to do it, why they should do it. So we need to give reasons in the standard. And I was like, no, no, no, no, no, no, no. We need to encourage people to work out the why for themselves, and and that I wasn't going to give up on that. That was really a red line for me. And I think as you say, I've over what the standard's been around for eight or nine years now, that works, you know, work it out for yourself. Don't you know don't expect somebody to come along, you know, out of the sky and tell you why you should, why should we, anybody, you know, an expert committee or whatever, tell a business why they should do this. And I think that model that enables people to ask that question is is really, really key. You mentioned the risk and opportunity heat map, and I think that's another a lot of people talk about that, they find it really, really useful. However, you're unique in talking about NXA, and I'm delighted you did because you're right. I've I think I might have written the early draft of that, I don't remember, that was such a long time ago. But again, it's it's one of those things that says to procurement people if there is a sustainability impact, you know, it's in a sustainability impact. And these are the procurement techniques that you can use to deliver it. And that was so important, and again, it was it was giving this sort of understanding, the translation between sustainability and procurement people. If you talk a procurement person's language, okay, you know, so if you if you Were to do a whole life cost analysis of a product that will address both climate change potentially and circular economy if you do it well. You don't have to understand terms like circular economy that might be unfamiliar to you. But if you if you buy something and look at the the whole of life cost of it, including disposal, because then you're talking a procurement person's language. I can get my spreadsheet out and I can do, you know, I can add up all the numbers and I can compare one with the other because that's that's what my profession is, it's what I like to do, and it it's and sometimes it comes up with some stunning answers. And um, again, I was doing a an interview earlier this week where somebody was telling me that they looked at two different laptops and they both had some sort of you know energy sustainability rating thing label on them. When they actually looked at them, one was 60 times, six zero times more energy consumption than the other. And you you think and that's not you think you think well it's just just a laptop and laptops don't use much energy if you buy a lot of them, it's 60 times is significant. So again, as a procurement person, I can sit down and get that data and I can work out the cost and I can build that into my evaluation, and and that that makes sense to me. So yeah, thanks very much for mentioning LXA. Not many people know, I don't think many people dive into LXA and they should, you're absolutely right.

SPEAKER_02 23:55

It's it's literally saved even now on my desktop as my go-to because if and but you know, we're lucky, we're fluent in procurement and we're fluent in sustainability, but sustainability practitioners are not, and I just think it's the easiest way to translate sustainability concepts into procurement speak. It's brilliant.

SPEAKER_01 24:20

Yeah, no, and I think it's again, it's one of the things that we talked about a lot when we were developing the standard. You're sparking all sorts of memories with me now. The whole thing about we shouldn't expect procurement people to be experts in sustainability. Because as a procurement person, you're an integrator of a very wide range of other professions. You know, you've got technical people, you've got legal people, you've got finance people that will advise and help you when you have a particularly, you know, if you've got a particularly complex contract, then you you get advice from a lawyer. If you're doing maybe a very long-term outsourcing deal or private finance initiative or something like that that's financially complex, you you get an accountant to come and help you. So don't expect to procure people suddenly to know everything about circular economy or climate change or uh, you know, sort of uh ethical issues or whatever. You you you consult with an expert. I think that was again something that we did try to get across in the standard that's very important.

SPEAKER_02 25:23

Yeah, and that that's also like you know, there's still a raging debate around to certify to remain a guidance. And given the breadth of what procurement touches and manages, and it's not just procurement, it's the overall governance approach of an organization. It's also the risk, the traditional risk enterprise management framework and the risk categories, and how that then should be informing the procurement risk and opportunities. That's also informed by sustainability, and then it's also around the financial implications, it's the ecosystem which it sits within. That is very contextual, and that's what I why I think it's so interesting because you know, category management, you become a category manager, you're familiar with your portfolio, you're familiar with the key players, and perhaps the up and coming, you're familiar with where the opportunities are for commercial negotiation because you have an idea of where profit sits with that type of category of spend. And then you've got the contextualization that's based on drivers, culture, financial tolerance that then apply within a sustainable or responsible procurement framework. Then you've got, well, what legislative instruments apply. So, you know, you might have mandatory human rights or modern slavery reporting, you might have mandatory climate financial disclosure, you might not have any of those. So, how you can effectively choose your own adventure, I think that the standard allows enough latitude, it gives you enough guidance around topics, the consistent procurement methodology and where to apply it, but with the well, you need to use this information to then define materiality, whether it's sustainability, materiality, or material priority of the category strategy where you're integrating sustainability, and then the end outcome, also how to manage internal capacity, because collecting data and supplier engagement program actually takes time and effort, but of course, you it's necessary. So, how do you then segment who you are engaging? Uh that's what I think it's very flexible. It's a flexible framework to be able to apply based on your context, based on the context of the market that you're buying, the category that you're you're buying, and then also the individual supplier capability that you would assess as a part of that process. I think we did great.

SPEAKER_01 28:11

You mentioned category management several times in this discussion, and I'd like to pick up on that because that's absolutely key. A good category manager is worth their weight in gold because they understand the products and they understand the market, and really to properly apply a sustainable procurement technique and even to do the risk and opportunity analysis, uh as a uh as a doing it as a consultant. I've run uh hundreds of workshops doing just that. But if the category manager doesn't really understand their category very well, you don't get a very good result. Whereas if if you do have that engagement for somebody who's got that expertise and that deep knowledge of their category, then you can really start to understand how you can apply sustainability techniques. It's uh again, I'm glad you mentioned it because I think it's really key.

SPEAKER_02 29:05

Well, very much because that's as consultants, the the one what are we unable to provide that is actually a really important part of a category management strategy and even defining risks and opportunities for your own business, and that is how do you define criticality, business criticality, and that's almost the fourth dimension. I don't know if we explicitly articulated it in the standard, but you know, often there'll be risk allocation that has a financial cost, and I I I guess that's actually a part of the integration of climate carbon and and social in a financial disclosure, is the capital cost that's associated with that impact. But if we're looking at defining what our category risk profile looks like even before we get into sustainability, understanding the criticality of that category, not just the market, but what it means to your business, and is there any financial metrics that are associated with it? And often we'll see business continuity plans or risk frameworks that say, you know, we can quantify millions of dollars associated with a network outage like happened today in the east coast of Australia. Network went down. That company can quantify that anything that touches their physical network actually has multimillion dollar per minute costs to the business if it's not working. Therefore, the business criticality of network providers is highly elevated. And that to me is what a category manager knows is not just the market, but it also knows their stakeholders and the importance associated with the suppliers and the functioning of the business. And that's again a quite a unique straddle of sustainability, risk governance, and commerciality that procurement category managers can bring to the table.

SPEAKER_01 31:12

You touched on the certifiable versus guidance standard debate. Um where are you in that uh in that debate these days, Daniel?

SPEAKER_02 31:23

Uh it comes up. Uh, when I left my last place of employment, my team very cheekily gave me a fabulous crystal cocktail shaker engraved with ISO 2400 certified, which was much hilarity at the time, but still, you know, it's still quite um frustrating, the sods.

SPEAKER_01 31:46

And I I still get the tinkling of a broken crystal metal.

SPEAKER_02 31:52

Every time I use it, no, we don't have to be someone ahead with it. Oh, yeah, it's quite weighty. Um but it shows their humour and how well they knew me. I think that there are component parts that could be certifiable, and I guess if we look at quality management and environmental management systems, it talks about the process pieces and what you need to do to have as evidence for being able to certify. But I still think that, and again, this is a contextual, I think some organisations and some jurisdictions certification would actually elevate the importance of the standard and the applicability to deliver the outcomes. And if we look at the jurisdictions that perhaps haven't had as high a take-up as what we'd anticipate, an eco-label is something that makes it easy for anyone to be able to understand. We know clear boundaries, especially if it's at an international level. So there's there's pros there, but I just think that the diversity, the contextualization and how it's applied, particularly with how fast regulation is moving in sustainability, whether it's reporting or not, or disclosure or not. I think there's a lot to be said for a flexible framework that can be self-selected with what's applied. And I don't think that a certification would provide those parameters. And maybe it's around blocks, so aspects of the procurement process where apples for apples comparison and evidence can be provided. But until we've got things like standardization in whole cost analysis or cost calculation methodology, I don't think we're there yet for a fully certified standard open for pushback.

SPEAKER_01 33:51

Okay, good debate, absolutely. Um, yeah, well, I'm certainly a fan of the guidance standard. I think it, as you say, does give you that flexibility. A couple of people have suggested, and sometimes this suggestion fills me with horror that there should be two standards. But I think it draws on your point of yes, there are some elements that you can potentially certify, and maybe you know you start with a guidance standard, and once you're once you get to a level of maturity that you want to be certified, then you can move on to a certifiable standard. And it's instinctively, intuitively, I go, Oh my god, well, you know, the the answer for standards people, of course, is what we need is more standards. But I'm I'm beginning to think that that argument might make sense because, like you, when you start to deal with people in Africa, in the Indian subcontinent, and uh to to be uh to some extent East Asia, you know, a certificate. I want a certificate. You know, how do I get a certificate? And and that's the thing that they is absolutely needed in that culture. But I I I think it would be disastrous to lose the uh you know the flexibility of the guidance standard. But yeah, I I think I'm beginning to come around to the idea that the world might need some certification, but let's not make it that sort of you know, pass fail. Oh my god, the author's coming way to behind the bad stuff. Um, it's you know, we we need to make sure that there's an alternative to that.

SPEAKER_02 35:30

Yes, and a pass fail, like that does not give you any insight into the level of maturity, and also, I mean, as a procurement person, it would be amazing to go, hey supplier, your supplier governance processes, do you have certification? And it'd be like a tick, and it'd be like, amazing! But again, what does that actually mean? And and for me, that's always been the driver behind sustainable procurement is asking the right questions that are contextual, that give you information to then inform how you work together. But that that's for for bigger bucks than us, huh?

SPEAKER_01 36:11

It's absolutely yes, it's an ongoing, ongoing debate, most definitely. So I was talking to um one of our podcasters in the United States recently, and she was talking about um suppliers in the um uh sort of laboratory science medical sector, and a supplier that that ticked the box to say they had SA8000 certification for their ethical practices. And it turned out there are dozens of factories around the world, one of them was certified, and it wasn't the one that was supplying their stuff. So it does come down to that procurement technique if you keep asking questions until you get an answer that is right, uh and a tick tick box certification, uh, eco-label, and all of that, and again the example from my other podcaster of the laptops, that they both had the same sustainability certification. Um, but one was 60 times less energy efficient than the other. So yeah, it is, but that's good procurement. People ask those questions.

SPEAKER_02 37:12

Absolutely. Clarity on boundaries, what's included, what's not, and then what does that mean for me? I think harmonization would be really helpful from a global supply chain perspective, but also relational and geographic, that's I when you're doing impact assessments to determine the risks and opportunities, and particularly if you're looking at sustainability impact allocation, the same topic has a different risk flag depending on the geography. And so a commodity like I use rice is the most accessible analogy. So rice here in Australia has a really high water and environmental impact because we're very water poor. Rice is actually uh needs a lot of water for farming practices. But if you buy rice from India or or Thailand, the environmental impact is so much lower because of the natural rainfall. And then when you actually start to explore why is water used in rice farming, well, it's actually traditional rice growing practices. It does the rice doesn't actually need it, it's a form of pesticide. So evolution in that particular commodity means that now rice in Australia grown with new sustainable farming techniques doesn't have that same risk allocation or impact allocation when we're looking at environmental impact, but you don't know until you ask questions.

SPEAKER_01 38:45

Yeah, it comes back to being a really good category manager and really understanding your category as it is today. Absolutely. Absolutely. Uh Tony, you've talked about a lot of things that you like about the standard. Um, what don't you like about it? What do you think might be able to be improved?

SPEAKER_02 39:03

Is that like asking about you know your children? Like which one don't you like? That's the best answer I've ever heard of that question. Where I think that there could be improvement, I don't think that we talked about the role of due diligence and the iteration of due diligence throughout the procurement process and even pre in a way that did it justice. And because due diligence doesn't just sit with procurement, if you think about due diligence of merger and acquisitions, like due diligence as a due diligence has such an important and insightful role to play, and it happens at multiple stages. So it's due diligence before your short list, it is due diligence and understanding risks and impacts associated with category or commodity, there is due diligence of the individual supplier, there's risk screening platforms and trade sanctions, and I think the next iteration of the standard actually, and then if we're introducing things like human rights due diligence according to the OECD, and what we're seeing, you know, around the world, around mandatory human rights due diligence, then environmental. So I just think that elevating due diligence and and just how informative that process, but also how iterative it is, and also taking that supply perspective of how can we as buyers find out information without asking. There is lots of publicly accessible information that we should be able to access and inform the next steps of engagement and contracting, and that doesn't necessarily happen. We get questionnaires get pushed out, and there might be one questionnaire for this topic, and etc. So I think due diligence needs to be elevated and articulated in a way that can be picked and packaged up for where you are. What else? We came up with the first cost calculation or you know, the externalization of monetary externalization, but I think we missed an opportunity by not having finance and investment people in the room because I think that procurement and finance people understand cost calculation methodology, and while we've got we've got the concept there, we haven't got the how. And if I think about you know, clients or even myself, we can't expect procurement to be the people that understand how you can quantify in an evaluation this supplier and their response here for this product in this context is better than so that the blue and this is an apple. And so they're left going, well, how on earth do I assess this in a way that will give me my evaluating? So an evaluation matrix with a repeatable and consistent cost calculation methodology for the different topics that might have uh a locational, like a national factor, like we've seen with carbon for whole cost. I think we could do better there and we could pull through the financial investment discipline in a way that makes CFOs who purse carriers, you know, they are still the key audience that we need to crack to change the way that value is accounted for in the bottom line, because until we change the concept of acquisition cost versus whole cost, and if we look at waste, like waste is not waste, it's actually a material with a changing value. Until we can capture that in a way that's business and commercial, I think we'll still not quite get the end outcome that we're after, which is you know positive change. So they are kind of due diligence and cost calculation methodology would be where I think that we can we could have beefed it up at the at the time perhaps not thinking about it, but now I think they would absolutely be key recommendations for future improvement. And I also think that the world's changed and human rights and carbon and climate, there there's much more sophistication. So, how do we pull other standards into procurement? Here's how you integrate it, here's how you calculate it, here's how you provide it back out to your key internal stakeholders and your your supply chain. So that that'd be the three kind of priorities from my perspective.

SPEAKER_01 43:57

Yeah, thanks for that. I I had a similar suggestion on on another one of these interviews, and saying that that might not necessarily be something in the standard, there might be some technical guidance that sits alongside the standard. Um, and it's it's the how to, um, which I Think was a very interesting point. And we kind of when we got to the end of developing the standard, I mean there were a few questions about do we want to go on and do technical guidance, do we want to do that, and do we want to do this? And we're like, no, we've got enough four years to develop the standard. Thank you very much. I'm loving it. But um, I no, I think that's like we're getting a few suggestions, and it's really interesting. You know, we're going to run as many of these interviews as we can with as many people as we can find that have actually used the standard and have experience of it. There's certain things are coming through, um, things that people like, and then this is uh the the sort of how-to piece of it is um is coming through quite strongly. And then yes, you mentioned the due diligence, and of course, that's a it's one of those expressions that that people use and don't really necessarily understand it or have different interpretations of what due diligence actually means, it can be very painful. Um, but yeah, that the how do you do that, and also um the role of AI in all of this. I mean, I I interviewed a young man in the United States, he was really a bit annoying. I think he was 24. He'd already set up a business and sold it for a ton of money, and now he was setting up another business, which was um uh AI-generated searches for procurement people, um, where you it's like an initial search, so it doesn't replace the questionnaires and the other stuff that you might do, but it actually looks for data in a whole variety of different sources that you might not necessarily even know exist. So you can really start to get an understanding of what that supply market looks like. And I thought that was fascinating because it it wasn't it's not taking procurement people's jobs, it's just enabling procurement people to do their jobs so much better.

SPEAKER_02 46:07

Absolutely. We we have um there's a platform here in Australia that um was a startup, not so much woman-owned business, and it is around um uh using machine learning and machine and big data models, but also um it's verification of public commitments and claims with the actual bodies themselves, so they're able to access databases. So rather than you know, going to science-based target dashboard, they have a direct plug-in, and so they can then create a supplier profile that has verified the claims with public or database evidence, which from a procurement, I mean, if you think about what are the things that work really well for procurement people, they are credible databases to access information efficiently to then inform what you do with it. And from a sustainability perspective and and and knowing that science-based targets is one of the most credible from a uh a carbon perspective, if you're able to create a supplier profile using AI or machine modelling, why would you not go down that path? Because immediately it gives you a here we go, here's our preferred short list based on this criteria and sustainability being a core component of that. Didn't need to ask the supplier any information, so reducing the burden of admin and and you know responding to the same question that's asked a different way, so which takes time to tailor, um, and immediately gives information to inform decision making. I I think there's in fact I um I like to always ask a platform to run whatever organization I'm working for, show me what the profile what you find, because then that gives me insights into the effectiveness of the actual platform itself.

SPEAKER_01 48:01

Brilliant, thank you. Um Tanya, I'm gonna ask you a final question in a moment. Is there anything that you'd like to cover before I do that? Anything that we haven't covered?

SPEAKER_02 48:09

I think we cover quite a lot, but no, I mean, uh aside from if you're implementing a sustainability strategy, 70 to 80 percent of the delivery of the outcome is absolutely through procurement and the supply chain. And I just think that that's such an important piece that's really missed. How do you achieve your end outcome? You do it collaboratively and you do it with your suppliers and their suppliers. And what I really like about sustainable procurement is that it changes the landscape of how we do business to going from transactional to much more relational, trust-based, contextualized with a shared value outcome. And that's why I've been delighted to move away from traditional procurement, which um I think is a little bit more uh gritty and um not quite as as nice. It's been it's been nice to be a part of the sustainable procurement movement because it is about shared value and delivering you know positive outcomes, which being the bleeding heart that I am has been my favourite part.

SPEAKER_01 49:23

Okay, thanks. Harking back to your um introduction when you you talked about your early career and and somebody needed to do sustainable procurement, and you put your hand up and went me and got stuck into it. A lot of people in our audience are in that position, or at least some haven't gone me, they've just been told we need to do sustainable procurement, like you, you're doing it. What advice would you give to somebody who's starting their journey? They'd be given this responsibility, or they they've asked for the responsibility to pick up sustainable procurement. What advice would you give them on where to start?

SPEAKER_02 49:58

Oh, well, first of all, it'd be a welcome to the light side. Um procurement often has continued to say the same thing, which is I want a seat at the table, I want to be able to demonstrate the the value that procurement delivers. And so sustainable procurement is your perfect vehicle to be able to do that. It it is practical, it is implementable, but to be successful, it is around asking questions, it is around tailoring your communication for your stakeholder, not for procurement, because ultimately we are servicing our internal customers and we are delivering outcomes. So using that same language and understanding the business need and the business objective. There lean into your network or your community. It's a lonely place on the inside, especially if you're one of the only people, if not the only person that is responsible for delivering this. And we learn most of us love to share knowledge and information because we are driven by positive outcomes. Um, so make sure that you have a resilience through an external network that you can soundboard, a trusted one. And if if you haven't paid for and read the ISO standard, there is some fantastic business case-free resources that you can access around that will give you in information around why. There are so many case studies, and I think lastly, the the self-assessment tool on ISO2400.org is brilliant. Of course, it's free and it gives you an insight. I love spider graphs, really clear to be able to communicate where you're sitting, good visual. Unlike you know, there's some global platforms that will ask for enormous amounts of evidence, and you have to pay to prov to be able to get the scoring. Independent assessment is fantastic and it's highly credible. So it gives you something that you can use. It's also you can download it, it's a PDF that you can then take to your stakeholders to be able to have that discussion. And it's really clear it's quite simple, and it's not 52 pages worth of questions, which is an advantage. So they would be the core places, things like this podcast. There is so much more information out there than what there was when we were trying to work out what sustainable procurement meant and looked like and how we'd apply it. So be curious. And I think my last pearl of wisdom is as a category manager, I personally may have snuck in an initiative without permission because it didn't have a cost impact, and I was able to sneak it into my tender, and so I was able to move an entire organization to FSC certified paper with no endorsement or approval because it wasn't material, but it gave us the sustainability outcome. So sometimes use your professional uh knowledge and integrate something that you know that will have no cost impact, and then use that as this was a low-hanging fruit, look at what I achieved, and know it didn't cost us more.

SPEAKER_01 53:32

Brilliant, Tanya. Thank you very much for all of those pearls of wisdom. I'm sure our audience are going to find it fascinating, and uh also for me it's it's really interesting to build up a body of views around the world. We've done a number of these now, and we're going to do as many as we can to try and get those those different perspectives on sustainable procurement. So thanks very much for giving up your chilly evening in Melbourne, and um and I'm sure our audience will love it. Thank you.

SPEAKER_02 53:59

Oh, my absolute pleasure. Thanks for having me.