Good Practice
“Railsponsible” Promotes Eco-Friendly Practices in Railway Procurement and Supply Chains

Railsponsible is a new programme aimed at encouraging sustainable procurement and establishing common ground for eco-friendly business procedures across Europe’s rail industry. The programme was launched in March by six of the largest rail operators and manufacturers in Europe, banding together to promote sustainability across the industry and supply chain. According to Railway – technology.com, it pledges to promote good ethical, social, environmental and business practices.

There has been a global shift towards sustainable procurement in recent years, and this is particularly relevant in Europe where new EU public procurement regulations encourage public bodies to choose the most economically advantageous tender. The regulations, which came into affect in February, should push public authorities to consider “life-cycle costs.” This is especially important in the railway industry where the average lifespan of rolling stock for EU infrastructure is around 20 years. Just two weeks after the launch of Railsponsible, senior vice president at rail specialist Voestalpine Dr Martin Platzer told the Railway Forum in Berlin that the European railway industry needed a serious rethink in its approach to procurement. He told the forum that too many companies solely consider the short term, and therefore choose to buy the cheapest equipment.

Michael Boback, head of internationalisation at Deutsche Bahn, one of the railway operators that founded Railsponsible, says sustainability is not just a priority for industries affected by poor working conditions in faraway countries. “By taking responsibility for monitoring and engaging suppliers in a collaborative way, countries can improve efficiencies by assessing risks in their supply chains,” he says.

As part of the Railsponsible programme, a forum has been developed for exchange and discussion about practices that corporations can implement to help local communities and the environment. These responsible practices include key areas such as human rights, labour, environmental and anti-corruption activities, as well as transparency throughout the supply chain.

Each new member of the Railsponsible programme will undergo a supplier assessment campaign conducted by partner company EcoVadis to find their sustainability rating. Members are then given a ‘scorecard’ of the businesses strengths and weaknesses in ethical and sustainability performance. Railsponsible is hoped to be a benefit to all parties. It demonstrates commitment to an eco-friendly company culture, but companies can also benefit from a ‘common benchmark of innovation and enterprise’ maintained by fellow businesses.

Three of the rail operators involved in Railsponsible, Deutche Bahn, NS and SNCF*, jointly manage a network of over 67,000 km across Germany, the Netherlands and France, so the programme has the potential to make a huge impact. The operators also have a total annual spending volume of €15 billion and in 2012, the EU railway procurement market invested around €34 billion in conventional and high-speed lines. In addition, €26 billion is set to be spent on transport infrastructure in Europe over the next five years.

Work is already being done to develop sustainable practices in Europe’s railway industry. Nederlandse Spoorwegen (NS), one of the founding rail operators, is planning a shift from electric to wind-powered trains on its network by 2018. Currently 50 percent of its trains operate on wind energy, but the planned switch will save even further energy and reduce waste. Head of procurement at NS Group, Bas van Kempen, said the group would share best practices in sustainable procurement, and that the ‘corporate social responsibility’ performance of NS’s suppliers would soon become part of its sourcing strategy.

Railsponsible’s immediate goals are promoting engagement between current members and encouraging participation, as well as promoting the scheme to other companies.

*Earlier this year we produced a case study on SNCF Procurement in SNCF demonstrates its value to the organisation,” which drills down into the advancements in procurement already made by the Railway company giant. (It’s free to download.)