Ethical procurement: Practices to support integrity and honesty in supply chains

Posted on Sep 09, 2023 at 10:09 PM

The term "ethical procurement" may well support different businesses' reputations and long-term success, with its principles and values adopted in decision-making processes about supply chains.

Follow the following article that speaks more about this concept and its significance, so get ready to see how an ethical buy can affect your purchasing strategies, support your brand, protect your bottom line, and positively impact society.

What is Ethical Procurement?

Ethical procurement is day-to-day procurement practices and procedures that are usually based on ethics of integrity, honesty, and fairness in all respects while moving away from the risks involved and from any other bad practice that leads to fraud, corruption, or any event that damages a company's reputation and affects its competitiveness within the market and market value, thereby losing money.

Ethical procurement identifies various legal, environmental, and social practices and ethics to achieve fairness and equity. It seeks to increase companies' understanding of the social responsibility they must follow to ensure that their purchases are further improved.

These ethics are usually developed according to certain bases and principles by government agencies, industry organisations, or ordinary companies in the form of enforceable and controlled rules and documents to control consumption, buying, and sale.

Anyone involved in purchases, the seller, the buyer, or any other party, commit to an ethical approach to their work so 

to ensure that appropriate behavioural standards bind all parties involved in sales and purchases; when implementing proper ethical procurement, you can get positive results that reflect both the company, the community, and the government, and support local producers.

Ethical procurement strategies include a wide range of issues that impact the company's ethical objectives and sustainability, including control of immoral and illegal business practices and suppliers that affect purchasing efficiency and company reputation. For example, the bribery scandal or unethical hacking of specific applications and downloading their data content can lead to enormous fines and a bad reputation for the company.

What is the importance of ethical corporate procurement?

The importance of ethical procurement is the fact that it supports the need to follow ethical regulations and standards that, in turn, protect the employee, society, and the environment. Studies state that it has a role in improving the quality of the company's services or products. Investing in a procurement training course in London can improve knowledge about this profession.

For example, health regulations require companies to ensure that their products are safe for use by their customers, or anti-corruption laws oblige companies to stay away from corrupt actions such as bribery; adhering to those regulations and laws can build a reputation and create reliability in dealing with end consumers, employees and others.

What are the general principles that define ethical procurement?

Many general principles for implementing ethical procurement determine how to apply the procurement plan in general; the most famous of these are:

• Maintain standards of ethics and integrity when conducting business activities.

• Work to protect the interests of buyers and sellers alike.

• Ensure that each of the parties to the transaction.

• Adopt the principle of fair and good faith.

• Keep records of all transactions, allowing any investigations to be carried out upon suspicion of possible violations and address the matter.

• Request an expert consultation for more tips that may be useful.

• Learn the legality of contracts concluded in conformity with applicable regulations and legislation.

• Maintaining the confidentiality of commercial transactions in a manner not inconsistent with the law or any contract provided otherwise.

What is the role of personal standards in compliance with ethical procurement strategies?

Most institutions work to establish and enforce standards and laws for their employees, but the individual's standard remains the basis for ensuring their implementation because whatever the degree of stringency of the institution in imposing and controlling regulations, human beings are intelligent and can create a gap for exploitation, corruption, and personal benefit.

According to some models and studies, the personal standard is on three points in its activities and movements: beliefs it believes in, values it adheres to, and how it deals with other people's attitudes. Ideas usually evolve due to experiences, education, and personal culture, leading to values that shape human behaviour and attitudes when buying something.

Concluding,

Ethical purchasing is vital to making sound purchasing decisions to buy goods and services for the production process, ensuring that people get treated and preventing illegal behaviour in a competitive world to provide the best services or products to customers at the lowest prices so ethical purchasing is a necessity for us to follow to maintain a good relationship with customers and protect the company's reputation.