Henrik Nilsen
Head of Procurement Excellence

Topdanmark is a leading insurance company based in Denmark.

With more than 14 years of experience in procurement, Henrik Nilsen shares his perspective on the importance of Procurement to achieve strategic goals and predicts that ESG will continue to take up more space on the boardroom agenda.

“Procurement was not on the agenda when we started this transformation journey to centralize the unit. Today, it is one of the organization’s key strategic pillars.”

From administrative to strategic

As Head of Procurement Excellence at Danish insurance company Topdanmark, Henrik Nilsen has been focused on establishing the procurement function as a strategic unit and reducing Procurement's administrative role. “Procurement was not on the agenda when we started this transformation journey to centralize the unit. Today, it is one of the organization’s key strategic pillars,” says Nilsen.

Procurement is increasingly viewed as a key route to reducing costs. “Procurement is playing a multi-dimensional role in creating a sustainable and profitable product. We are taking a holistic approach to reach maximum value. It means evaluating both price, service, customer journey, ESG, as well as internal processes.”

Procurement’s role in value creation encouraged the organization to consider it as a key strategic driver. Nilsen explains, “The first year was focused on building a strong foundation, introducing new sourcing processes, tools, and launching key projects identified during our initial Opportunity Assessment. Through these engagements, you demonstrate that Procurement can create value and deliver real money. This creates trust and gains credibility.”

However, Nilsen does not see Procurement as the core driver of ESG within the organization. Instead, “ESG strategy should be owned by an ESG team that the procurement team would supplement. There should be a central unit making sure that there's a connected approach taken across the organization.”

The need to establish standardized methods

Organizations have become increasingly concerned with the ESG credentials of their supply chains. As a result, suppliers are receiving tailored questionnaires from different organizations requiring detail of their ESG credentials.

“Many suppliers are tired of getting questionnaires and codes of conduct from all companies and customers in different forms. Suppliers want a standardized method. It is a burden for them.”

While progress can be made on an organizational level, cross-industry collaboration is needed to create a meaningful difference and mitigate against climate change. Nilsen says, “A joint effort is needed to really push the ESG agenda to the next level.”

“Topdanmark has an ESG strategy in place and recently signed the Science Based Targets initiative. We are trying to launch several initiatives to keep up and get ESG as an integrated part of our procurement journey. However, joint efforts in the industry, or together with governmental bodies, are needed to really push the agenda forward.”

Procurement’s vital role in making ESG strategy a reality

Through in-depth surveys and interviews with more than 1,000 Business Leaders and Procurement Professionals, we sought to understand the true state of the ESG agenda and its relationship to Procurement and Procurement Professionals.

Read the full report