Leading the way to net zero: Embedding sustainability in procurement at a sovereign wealth fund

Procurement is one of the most powerful levers in the race to net zero. A sovereign wealth fund in the Middle East, committed to achieving net zero emissions by 2050, recognized procurement’s potential but had yet to fully hardwire sustainability into its DNA. Partnering with Efficio, the fund set out to transform its procurement function – bringing sustainability to its core and positioning itself as a sustainability leader in the region.

The fund’s situation was a common one. The intent and motivation to drive sustainability improvements were strong, and they now needed the correct infrastructure and mechanisms to turn ambition into action. 

Sustainability was already built into corporate policies. The next step was to fully integrate this into procurement. This required:

1. Implementing a sustainable procurement strategy to ensure sustainability would be built into procurement planning and activities. 
2. Embedding an organizational understanding of how Procurement could incorporate and drive the sustainability agenda through the supply chain.

Recognizing the need for a transformative approach, the fund partnered with Efficio to define what best-in-class sustainable procurement looks like and map out how they could move further along the sustainable procurement maturity curve.
 

Challenges and approaches: Embedding sustainability into procurement strategy, processes, and people

1. Establishing a sustainability mandate

Sustainability is often cited in but not truly built into procurement policies, strategies, and day-to-day activities. It is all too easily deprioritized when time is tight, budgets are limited, and teams are stretched. 

For our client, the first step was conducting a gap analysis of the existing procurement policy to identify opportunity areas. The assessment revealed that, although named as a key principle, sustainability was not yet fully embedded into key procurement processes such as supplier relationship management (SRM) and sourcing.

To address this, the client-Efficio team updated policy documents to reflect the client’s sustainability ambitions, their ESG priorities, international and regional frameworks, and Efficio’s market insights – in alignment with ISO 20400, an international standard for sustainable procurement. The policy update set clear internal and external accountabilities and ESG priorities, incorporating sustainability into the fund’s end-to-end procurement methodology.

2. Empowering procurement teams 

Procurement teams are generally eager to drive sustainability improvements but require the right training to do so effectively. Procurement leaders should find and address knowledge gaps to build a truly “ESG-literate” team.

A sustainability maturity assessment identified key development areas for our client, including:

• Supply chain emissions accounting and reporting
• Sustainability-focused supplier engagement strategies (on specific topics such as KPIs or risk)
• Utilizing demand-side sustainability levers, such as demand management, specification changes, and end-of-life product design

The procurement team then went through a tailored training program that equipped them with the knowledge and skills needed to impactfully embed sustainability into their activities. 

3. Transforming data into action

Supply chain emissions can be challenging to quantify. However, spend data offers a robust starting point for procurement teams, who can multiply spend with category-specific emission factors to estimate emissions per spend category. Procurement teams have a wealth of insights at their fingertips – the differentiator is whether they know how to tap into them.

Using Efficio’s CarbonCube®, our client leveraged available spend data to calculate Scope 3 supply chain carbon emissions; output can be further refined over time with more granular figures such as supplier-specific data. The CarbonCube® enabled the team to identify both category and supplier carbon hotspots and assess suppliers’ sustainability maturity by enriching traditional procurement information with external datasets such as CDP and EcoVadis ratings. 

For the fund, business travel emerged as a high-emitting category that Procurement could significantly influence. The client-Efficio team built a sustainability-focused category strategy, supported by detailed analyses of flight emissions and practical levers for reducing them. The strategy applied the “Triple Bottom Line” approach, balancing Profit, Planet, and People, to provide a compelling business case for how emissions and cost could be reduced in parallel. This demonstrated Procurement’s strategic importance as a lever for both commercial and sustainability success.