In the last issue of Sustainable Sourcing, we published an article about how Baxter Healthcare had saved almost $12m through its sustainability programme during 2008. We caught up with the company’s sustainable purchasing and supply chain chief, Tina Bova, who revealed that a greater understanding of its suppliers’ environmental performance was enabling it to fully evaluate the impact of its procurement strategy and identify further potential savings opportunities.

Supply chain visibility is Baxter Healthcare’s prescription for success. Last year, Baxter conducted a supplier sustainability survey of around 100 of its major US suppliers – a proportion of its supply base that represents $2.2bn of its total supplier spend – in order to gain an almost unparalleled insight into its suppliers’ green credentials.

“The purpose of the survey was to establish a baseline in order to determine if our top suppliers had environmental programs, what elements their programs included, and where Baxter might be able to influence improvement,” says Bova. “We’re determined to improve the environmental impacts of our purchasing.”

The past 12 months have seen Baxter step up its sustainability efforts as it looks to build on cost savings totalling $91.9m resulting from its environmental programmes since 2003. Additional energy savings, improved non-hazardous and regulated waste management practices – as well as additional recycling revenue – saw the company achieve a $4.8m increase in environmental savings last year, with the $11.9m figure representing 70% of the cost of Baxter’s basic environmental programme.

The company’s proposal documents now include information concerning suppliers’ sustainability commitments, initiatives and performance, while Baxter has also added sustainability language to its standard supplier agreements. Baxter is currently looking to incorporate sustainability criteria into its global supplier scorecards for direct suppliers.

Central to the company’s sustainability efforts is its association with the country’s Global Supplier Network – a collaboration of industry, the US Environmental Protection Agency and the US Department of Commerce’s Manufacturing Extension Partnership.

“The GSN works with large manufacturers, such as Baxter, to engage their suppliers in low-cost technical reviews to identify strategies for improving process lines and using materials more efficiently,” she says.

It’s an ambitious programme – and one which should ensure that the long-term environmental credentials of its global supply base – and there’s ample evidence that these suppliers are embracing the changes. “Many suppliers are very interested in working with us to share knowledge and help improve their environmental performance,” says Bova. “One supplier has realised cost savings of more than $200,000 a year through improved materia-handling practices, enhanced material utilisation and reduced waste generation and other opportunities.”

So what’s next for a company that was recently recognised as one of the 100 Best Corporate Citizens by Corporate Responsibility Officer magazine? “One of our major focuses during the next 12 months will be implementing a global green supply chain programme that includes criteria to evaluate our top suppliers’ sustainability programs. “We recognise that our supply chain and product distribution operations contribute to the company’s overall green house gas (GHG) emissions, and would like to better understand the risks and opportunities related to climate change and reducing GHG emissions within our supply chain.”