Green Procurement Playbook 2025

Embed sustainability into investment governance Leading companies treat investments in green procurement with the same rigour as other strategic initiatives, but tailor approval processes to the impact of sustainability. These companies: –Require procurement proposals to include a CO2 impact assessment alongside financial metrics. –Integrate internal carbon pricing into cost comparisons to reveal the true cost of high- emission alternatives. –Establish sustainability steering committees or investment review boards with cross-functional C-level participation. Some companies apply internal carbon fees to business units based on scope 3 emissions, creating both a funding mechanism for decarbonization and a financial incentive to pursue low-carbon options. Build joint ownership across functions The strongest business cases are not built in isolation by procurement. These are co-created with sustainability, finance and commercial teams, ensuring alignment with corporate strategy, market dynamics and customer priorities. Several companies have established cross-functional working groups to shape procurement investments, often co-sponsored by the CPO, COO or CSO.Finance teams, in particular, play a critical role. They can help translate CO2 reductions into cost avoidance, assess risk-adjusted returns and validate long-term financial impacts. Engaging CFOs early in the process increases credibility and smooths the path to approval. In one interviewed company, for instance, the CPO works closely with the finance function every quarter to plan and budget for sustainability-related procurement costs. Green Procurement Playbook: The CPO’s Guide to Delivering Value for Business and Planet 28