In today’s business landscape, sustainability is no longer optional. Small and medium enterprises (SMEs) are increasingly being asked to step up and demonstrate their commitment to ethical, environmental, and responsible practices. One powerful tool that helps companies track and communicate their sustainability progress is the EcoVadis Assessment. But what exactly is the EcoVadis Assessment, and why should SMEs pay attention to it?
What is an EcoVadis Assessment?
The EcoVadis Assessment evaluates a company’s sustainability practices across four themes: environment, labor and human rights, ethics, and sustainable procurement. It doesn’t just look at your goals but also assesses your policies, actions, and progress in achieving them. For SMEs, this is an opportunity to evaluate where your company stands in terms of sustainability and to identify areas for improvement.
Why are large customers asking their suppliers to complete EcoVadis questionnaires?
The push for sustainability isn’t just coming from governments and regulatory bodies. 91% of companies (EcoVadis, 2021) now consider sustainability criteria when making purchasing decisions. Larger companies are asking SMEs to complete EcoVadis assessments because they are increasingly under pressure to ensure that their entire supply chain upholds high standards of sustainability and ethical practices. It’s not just about managing their own practices; they must ensure that every partner in their supply chain meets these standards. In other words, the sustainability of their suppliers — which includes your business — is now critical to them.
Risk management also plays a crucial role. By undergoing the EcoVadis assessment, SMEs can proactively identify and address potential vulnerabilities in their operations, such as exposure to human rights violations, unethical labor practices, or environmental damage. Undergoing an Ecovadis assessment builds trust with larger customers, who are looking for suppliers that uphold the same rigorous standards.
Additionally, consumer demand for sustainable products and ethical business practices has never been higher. With 85% of consumers more likely to buy from companies with strong sustainability reputations (EcoVadis, 2021), SMEs that complete the EcoVadis assessment can tap into this growing market. Today's consumers are increasingly holding businesses accountable for their environmental and social impacts. By ensuring their operations align with the expectations of eco-conscious consumers through the EcoVadis assessment, SMEs can strengthen their relationships with large companies, build brand loyalty, and enhance their overall marketability.
Understanding the EcoVadis Ratings Methodology
When your company completes the EcoVadis Assessment, you receive a comprehensive scorecard that evaluates your sustainability efforts across the four core themes. This scorecard assigns a score from 0 to 100 for each of these themes, alongside an overall company score. This scorecard acts as a “report card” for your company’s sustainability efforts, highlighting strengths and areas for improvement. It also positions your business in relation to others by presenting your scores as percentiles.
EcoVadis. (2021). Raising the Bar [Image].
The ratings come with recognition medals: bronze, silver, gold, and platinum. These medals are awarded based on how your company performs relative to others, as well as the minimum scores achieved in each theme. A platinum rating is the highest level of recognition and is given to the top 1% of companies, followed by gold (top 5%), silver (top 15%), and bronze (top 35%). Achieving a high score in the EcoVadis assessment not only enhances your business’s reputation but also opens doors to more partnerships with larger companies looking for sustainable suppliers.
EcoVadis. (2021). EcoVadis Medals and Badges [Image].
Tips for Maximizing Your Score
Maximizing your score starts with outlining a clear set of policies, including objectives and achievable targets with a set deadline and clearly defined roles and responsibilities. These policies must be up-to-date, with a validity period of no more than eight years, and any key performance indicators (KPIs) you report on should be no older than two years. This ensures that your sustainability efforts are current and not based on outdated practices. When creating policies, start with a thorough assessment of your company's current sustainability performance and identify key areas for improvement. This will allow you to set clear, measurable, and relevant objectives that address all four areas of EcoVadis evaluation.
Aim to follow the SMART framework: Specific, Measurable, Achievable, Relevant, and Time-bound. Specific targets precisely define what you aim to achieve, such as reducing carbon emissions by 10%. Measurable targets allow you to track progress with quantifiable metrics. The targets you set should directly depend on the specific policy they are designed to support. For example, if your policy is focused on labor and human rights policies, a target might be increasing employee diversity by 10% within three years, measured by human resources data. Achievable goals take into account your available resources and capabilities, ensuring your targets are attainable and not too far-reaching. Relevant targets should address your company's overall sustainability goals and key challenges. Finally, time-bound goals establish a clear deadline, ensuring that your sustainability efforts are both current and updated.
Next, it's important to substantiate your claims with documentation. All policies, procedures, and reports should be supported by formal documents that include your company’s name or logo, demonstrating that these materials are in active use. It is important to provide concrete evidence of your sustainability efforts, whether through internal policies, contracts with external partners, or procedural guidelines. This documentation should be current and relevant, reflecting the actions and initiatives your company has implemented. For example, if you’re claiming progress in waste management, you could provide a maintenance procedure that outlines recycling protocols or a contract with a recycling provider. Evidence like a signed letter from your CEO endorsing sustainability goals or an action plan that details specific initiatives can also help maximize your score.
Furthermore, third-party certifications, such as ISO 14001, can enhance your EcoVadis score by providing independent validation of your sustainability efforts. EcoVadis values comprehensive initiatives that cover your entire business, supported by regular reporting on your sustainability goals. To maximize your score, ensure your approach is transparent, and backed by solid documentation and measurable targets.
How Achieve Sustainability Can Help You
Navigating the EcoVadis assessment process can be daunting, but you don’t have to go through it alone. Achieve Sustainability specializes in helping SMEs improve their sustainability practices and complete EcoVadis assessments with confidence. Let Achieve Sustainability help you demonstrate your commitment to responsible practices, enhance your reputation, and unlock new opportunities in a sustainability-driven marketplace. Reach out to us today to set up a complimentary consultation at info@achievesustainability.ca.
References
EcoVadis. (2021). Suppliers. Retrieved [24/09/2024] from https://ecovadis.com/suppliers/
Comments