EcoVadis ESG Ratings: Driving Sustainable Procurement in Global Supply Chains

Editor: Gina Nala, Agnes Sulistya (LCI Team)

Sustainability extends across entire supply chains. As global supply chains face rising expectations on environmental and social practices, tools to measure and manage sustainability have become essential for business operations. One of the most widely adopted platforms is EcoVadis, established in 2007, which provides a standardised approach to evaluating sustainability performance of the companies’ supply chains.  EcoVadis enables buyers to evaluate suppliers consistently, while helping suppliers identify ESG gaps and improve performance.

What Is the EcoVadis Rating System?

EcoVadis evaluates organizations across four sustainability themes:

• Environment

• Labor & Human Rights

• Ethics

• Sustainable Procurement

Methodology and Scoring Approach

EcoVadis applies a structured, evidence-based methodology to assess a company’s sustainability performance across four key themes: Environment, Labor & Human Rights, Ethics, and Sustainable Procurement; each of which includes detailed criteria such as greenhouse gas emissions, labor practices, anti-corruption policies, and supply chain sustainability. The assessment is customized based on a company’s industry, size, and geographic location so that the evaluation reflects relevant material risks and practices.

The methodology draws from internationally recognised sustainability standards and frameworks, including the UN Global Compact, Global Reporting Initiative (GRI), ISO 26000, the International Labour Organization (ILO) conventions, and the UN Guiding Principles on Business and Human Rights (Ruggie Principles)^[1]. By aligning with these benchmarks, EcoVadis ensures that its evaluations are consistent with widely accepted global expectations.

EcoVadis also applies tailored risk weighting, adjusting the relative importance of criteria depending on sector-specific risks, company scale, and regional context. Building on these benchmarks and proportional adjustments, EcoVadis translates its methodology into a practical assessment framework. The process unfolds in four steps:

1. Customized Questionnaires

Each company receives a tailored questionnaire that considers sector-specific risks, operational scale, and regional context. This contributes to maintaining relevance and comparability within industry benchmarks and reflects the sustainability challenges most applicable to the business.

2. Document-Based Evidence Collection

Companies are required to submit supporting documentation for each topic covered in the questionnaire such as policies, certifications, key performance indicators (KPIs), internal procedures, and audit reports. This is complemented by EcoVadis’ 360° Watch system  which scans publicly available sources for ESG-related information about the company.

3. Independent Review

A global team of sustainability analysts reviews each submission to ensure consistency, credibility, and proper interpretation of evidence based on a standardised evaluation framework.

4. Scoring and Rating

Each of the four themes is scored individually on a scale from 0 to 100, and an overall score is generated. Based on the total score, companies may be awarded one of the following rating levels:

• Platinum Medal: Top 1% of all rated companies

• Gold Medal: Top 5%

• Silver Medal: Top 25%

• Bronze Medal: Top 50%

• Badges: Committed” and “Fast Mover”for companies that do not meet the medal criteria but have completed the assessment and shown initial sustainability engagement.

For example, Hitachi Energy has received a Platinum rating from EcoVadis for two consecutive years. Our analysis indicates that the company maintains a wide range of policies across environmental, social, and governance areas, publicly disclosing commitments such as sustainability targets, procurement guidelines, diversity and human rights policies, and the ethical use of AI. In addition, Hitachi Energy has reported an updated score from the Carbon Disclosure Project (CDP), another key element considered within the EcoVadis assessment. These documented policies support the requirements of EcoVadis, which places emphasis on strong governance and transparency.

Why Companies Use EcoVadis

EcoVadis plays a dual role in the sustainability ecosystem—bridging the buying organizations and their suppliers through one standardised  ESG assessment platform.

For procurement and supply chain teams, EcoVadis offers a standardised way to measure supplier performance across industries and geographies. According to EcoVadis ^[1], their research suggests that centralized sustainability rating platforms may help procurement functions reduce costs by as much as 75% relative to running separate internal CSR assessments.”. 

Suppliers, on the other hand, gain access to global buyers through a recognised and comparable ESG score. A strong rating may enhance credibility and access to new business opportunities, particularly where sustainability credentials are pivotal. More than the score itself, detailed scorecard feedback highlights areas for improvement, guiding suppliers to pinpoint critical ESG gaps and help them align with buyer expectations.

Conclusion

ESG ratings like EcoVadis can be a  tool to identify opportunities for improving sustainability performance. Beyond assigning a score, the assessment offers insights into how a company’s policies and practices align with key ESG criteria—covering areas such as environmental impact, labor and human rights, ethics, and procurement.

For buyers, these assessments strengthen transparency and consistency in supply chain management. For suppliers, the process provides visibility into buyer expectations while highlighting clear pathways for improvement and broader market access. In this way, EcoVadis can promote shared value by supporting mutual understanding for business networks.

References

[1] EcoVadis. (n.d.). EcoVadis ratings: Business sustainability ratings to drive performance and impact. Retrieved July 21, 2025, from https://ecovadis.com/solutions/ratings/

[2] Kluthe. (n.d.). What does the EcoVadis rating indicate? Retrieved July 21, 2025, from https://kluthe.com/magazin/en/what-does-the-ecovadis-rating-indicate