Lapasar
Compliance & Governance

Sustainable Procurement

Also known as: ESG procurement, Green procurement

Sustainable procurement is buying in a way that considers environmental, social and governance (ESG) impacts alongside cost and quality.

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Sustainable procurement weighs factors such as carbon footprint, ethical labour, supplier diversity and responsible sourcing when making buying decisions, not just price. It reflects growing expectations from regulators, customers and investors that organisations manage the impact of their supply chains.

Practically, it means setting ESG criteria in sourcing, screening suppliers for responsible practices, and tracking indicators over time. It links to supplier diversity and, in Malaysia, to Bumiputera vendor participation as part of the social dimension.

Frequently asked questions

What is sustainable procurement?
Sustainable procurement is buying that considers environmental, social and governance impacts — such as carbon, ethical labour and supplier diversity — alongside cost and quality.
Why does sustainable procurement matter?
Regulators, customers and investors increasingly expect organisations to manage their supply-chain impact, making ESG a growing factor in supplier selection.

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