Most organisations channel a high proportion of their revenue to their supply chain and rely on them to deliver their goals, including sustainability. LOCOG is unique in this respect in that they not only rely heavily on their supply chain for delivery, but are also part of the revenue stream. Much of the work in delivering an Olympic and Paralympic Games is done through a type of barter system, where companies trade brand recognition for cash, value in kind services or in some cases, both.
There are also wider issues related to supply chains and commercial partners. Human rights are not well recognised in some supply chains and the current or historic corporate responsibility practices of some companies could be called into question when considering the Olympic and Paralympic values.
To this end I was grateful to LOCOG for inviting me to their supplier conference this week: some 400 suppliers were represented and the theme was all about winning. The suppliers are already winners having competed for the work but there is a further challenge to deliver an inspirational and sustainable Games.
I was curious to know how much the sustainability message would be pushed in a project where time is clearly of the essence. I was not disappointed. LOCOG has set a challenge to suppliers to use the Games to improve their performance in corporate responsibility in ways that go beyond their contractual commitments. They were asked to consider three objectives: to report their sustainability performance transparently; to share their sustainability lessons from London 2012 using public case studies; and, to openly disclose the manufacturing locations in their supply chains. They were also challenged to pledge three diversity and inclusion actions: to achieve the Diversity Works for London Gold Standard; to participate in the "Two Ticks" scheme to guarantee interviews for suitably qualified disabled people; and, to advertise their supply chain opportunities on CompeteFor, an online brokerage system.
I was particularly pleased to see the challenge to disclose supply chains transparently but the challenge had the caveat "as appropriate and within the context of your business". This is an obvious statement as they would hardly do it out of the context of their business but it makes the challenge sound weak. Human rights in some supply chains present a significant risk to many companies and public disclosure is a good way to address this issue. Audits have some value but are not the whole story. We have commended Adidas for being the first to disclose, I hope they will not be the last. We have also commended LOCOG on their independent complaints mechanism - but it has yet to be tested.
LOCOG's procurement process goes some way to addressing these issues but it is a mechanistic process based on the use of questionnaires and due diligence based on risk. There is currently no way of aligning the track record of commercial partners with the Olympic and Paralympic values and there are lessons to be learned here for future Games. Deborah Meadon of "Dragons' Den" fame presented the sustainability challenges at the conference, saying that she hoped in 20 years time London 2012 is seen to be the least sustainable Games because future host cities have raised the bar. I endorse that message, particularly with regard to this issue.
Good sustainable procurement is not just about putting things in contracts and supplier management processes. It is also about leading by example and inspiring your supply chain to higher levels of performance. LOCOG made a start this week. The challenge is to turn good intention into positive action and I look forward to seeing this in the run up to the Games and beyond.