In last week’s blog, I asked whether the current pandemic crisis would push “procurement with purpose” issues into the background once business emerges from the immediate crisis into a new landscape of economic recession or even depression. I said I would be back when I had “let the anxiety levels drop a touch maybe”.
In truth, the anxiety hasn’t dropped, and I write this as the British Prime Minister announces he has got the coronavirus. And I am far from sure which way the procurement with purpose debate might go. But let’s take a look at the factors for and against the core proposition here - that sustainability and purposeful business might be an unaffordable luxury in our not-so-brave post-pandemic new world.
Hypothesis 1 - Procurement with Purpose will be put on the back burner because…
· Businesses will simply be struggling to survive as we crash into a major global recession or potentially even depression. That will put the focus on cutting costs – and that will mean a brutal procurement environment with tough negotiations, delayed payments and all the usual outcomes we see when times are tough.
· Internal resources will be cut in organisations as they address their internal cost base too. That will include procurement, so as teams shrink, there will be less time for the “nice to haves”, which will include procurement with purpose programmes.
· Younger people, who have been leading the drive in areas such as climate change, will be worst affected by the economic effects of the pandemic. They will have to put their energies into simply getting and keeping a job, rather than campaigning for good causes.
· Ironically, the economic downturn will make it much more likely that climate change targets will be hit, so that might reduce the imperative to take more proactive steps to drive down emissions!
Hypothesis 2 - Procurement with Purpose will thrive because…
· We will realise how much we all depend on each other. That many people doing minimum wage jobs are arguably more important to society than bankers or Premiership footballers. Being kind and considerate, including to future generations, will be seen as a higher priority for society, supporting many of the procurement with purpose ideas and initiatives.
· There will be a backlash against firms that are seen to have behaved badly during the crisis, or afterwards (in terms of increasing payment terms for suppliers, for instance) and they will be punished by customers. The concept of “predatory capitalism” will be much discussed, and that scrutiny will survive into ongoing life, with firms being reputationally damaged if they don’t behave in a sustainable and purposeful manner.
· Young people will only accept their inevitable economic difficulties if they can see that society is moving in the right direction more generally, so pressure in areas such as climate change and plastic use will increase rather than diminish.
· The “socialist” solutions to the crisis such as re-nationalising the railways (in the UK) will mean the State taking a wider role, and less of the economy will be in the hands of profit-maximising bodies. The public sector is more likely to want to address “social value” and procurement with purpose issues.
So, which is it to be? I would love to hear views from others here. Of course, we have to be hopeful, but it could go either way is my feeling at the moment. The other question is how we can try and influence the outcome – assuming we believe in the principles, what can we all do to make sure procurement with purpose doesn’t disappear into the coronavirus dustbin?