Sustainable Purchasing

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On October 2012, Finnair announced that they are going to purchase the engines produced by International Aero Engines AG (IAE) for their new Airbus A321. It aims to reduce the emission of carbon dioxide and save more fuel cost. The above is the most recent evidence showing that sustainability becomes more important to a company, and showing that purchasing function is particularly suitable to make contribution on an organization’s overall sustainability.

According to Dahlmann (2008), in nowadays’ business, sustainability is one the most important topic for an organization. Economic, environmental and social effects of business need to be considered simultaneously. While considering corporate sustainability, purchasing has gained increased importance because of the following reasons. First, Sharma and Henriques (2005) stated that it is located at the starting point of the flow of materials, therefore suppliers of companies aiming for corporate sustainability must be involved and there is establishment for social and environmental standard for supplier performance, so it can make first contribution to overall sustainability. Second reason is that companies nowadays focus their core activities on the needs and requirements of their prime customers, while outsourcing those non-core activities to specialist suppliers.

Although there is an increasing research discussing different aspects of sustainable purchasing, there is no clear definition for sustainable purchasing. Those research streams have produced a certain amount of different definitions and terminologies of sustainable purchasing, describing similar approaches with different emphasis. Recently, Pagell et al. (2010) provided a definition of sustainable purchasing as “managing all aspects of the upstream component of the supply chain to maximize triple bottom line performance”, which refers to impacts on people, environment and profit. Similarly, Tate et al. (2010) states that...
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