According to an SM survey of buyers in the public and private sector, only 17 per cent said they felt the concept was fully understood. What is sustainable procurement?
The short answer is - it depends who you are and what you do. Purchasers want a consistent message about what sustainability is and they want clear targets to achieve.
So what can you do and where is help available? In May 2005 prime minister Tony Blair set up a business-led group called the Sustainable Procurement Task Force (SPTF) to examine how the public sector's £150 billion budget for goods and services can be spent in a sustainable manner .
The aim of the group was to show how to get value for money for the public purse throughout the lifetime of a product or service, from creation or purchase to disposal. At the same time, sustainable purchases should benefit the organisation that buys them, help society, boost the economy and support the natural environment. In other words, quite a broad remit, and significantly, it's not just buying "green" or recycled products. It involves considering the social and economic impact of what you buy and where you buy it. It is about reducing the negative impact procurement may have on the economy, society and environment and increasing the benefits on all three.
Shaun McCarthy was a member of the SPTF and is now a director of awareness-raising organisation Action Sustainability. He frequently uses Manchester City's Eastlands stadium as a location for training because it is seen as a "sustainable venue". It is, in his view, an excellent example of a sustainable procurement strategy benefiting the local environment, economy and area as a whole. The club is having a wind turbine built on-site, due for completion in October and capable of producing three megawatts of power. It already gets much of its energy from renewable sources. It also procures everything possible within a few miles of the grounds to ensure it is using local services and suppliers. For example, football shirts are made locally, as are the sandwiches sold on match days. This keeps money in the local area and reduces the environmental damage caused by transporting products over long distances. Finding opportunities But the premiership team's approach would not suit everybody and other organisations have different priorities.
"While Manchester City FC can have an impact on local economy, a facilities management company, for example, can make a big impact on energy consumption, as can an architect when they design a building," says McCarthy. Others, for instance construction companies, might concern themselves with their impact on the use of natural resources and the preservation of flora and fauna. And cleaning companies will need to examine how water quality is affected by the disposal of cleaning fluids, and the labour standards experienced by staff, who are low-paid. "It's about constructing a view of sustainability and the priorities of an organisation," he says.
Liz Cross, head of CSR strategy and policy for procurement at BT, which has twice been winner of The CIPS Supply Management Award for best contribution to corporate responsibility, says: "It's often about understanding what your opportunities are and what you can do." So, what has it done? It increased the use of recycled products, reduced the amount of waste sent to landfill, examined its energy efficiency and carried out risk assessments on the environmental and labour standards applied by its suppliers. In doing so it has made financial savings, while boosting its reputation with staff and customers. It has also been working on it a long time.
In terms of social impact, Stuart Williams, who leads procurement work at sustainable development organisation Forum for the Future, says buyers can stipulate that a percentage of the workforce is made up of local people, or candidates from the unemployed register.
"This puts money where it is needed in the local area," he says. "We know some social firms which employ people with learning difficulties, which takes them off benefits and out of day care, helping them and making a saving for the public purse." One example of using a social enterprise to create employment is construction company Necta, which employs young adults in ground maintenance construction of landscaping, giving them a qualification and income. It does about £0.5 million of business with Nottingham City Council.
David Wright, regional director of the North East Centre of Excellence, one of nine regional centres helping councils improve procurement, is lead for the centres on sustainable procurement. Among examples of good practice he's identified are Dorset County Council's review of its fleet of vans and cars designed to reduce emissions, Warwickshire County Council recycling demolition materials into road hardcore, and Brighton & Hove City Council developing a new library facility which has as little negative impact on the environment as possible and provides employment to local people. "There are tens, if not hundreds, of good examples," he says, "But there are 388 authorities and some aren't doing anything. And where some are doing it, they are not addressing it corporately, it's just based on the enthusiasm of one individual. And that's not sustainable if that person leaves."
The SPTF has tools to help organisations judge their progress on sustainable procurement. The "flexible framework" identifies five areas which need to be addressed: people; policy, strategy and communications; procurement process; engaging suppliers; as well as measurement and results. The chart can be used to plot your organisation's achievements in each of these five areas. For example, on "people" it says organisations that are at a basic level will have appointed a procurement champion. Those that are advanced will be winning awards and sharing good practice. Wright emphasises that what is needed is a "genuinely corporate procurement strategy". And central to this is the fact buyers cannot achieve it on their own.
"Procurement officers are being left to do it but it should involve environmental, economic, social inclusion, regeneration officers, catering managers and others because it can complement a number of objectives of an authority," he says.
Barbara Morton, a director at Action Sustainability and former project manager of the SPTF, adds: "The more stakeholders you involve the more engagement you're likely to get."
The SPTF also developed a methodology which can be applied to determine priorities for sustainable procurement. "Should a robust methodology not be applied" it warns, "then it is highly likely that resources will be focused on 'easy to deal with' spend areas and opportunities to deliver the highest benefit for the least resource will be missed." Using the best available data it suggests buyers look at high spend areas, low spend areas that have a high environmental and socio-economic impact and sectors where there are opportunities for quick wins such as white goods and paper. The task force applied this tool to find 10 priorities among the government's 174 spend areas. These include construction, health and social work, food, uniforms, waste, transport, paper and printing and energy.
Morton says: "Organisations should use this methodology to determine their own priorities. Consider your spend and the sustainable impact on market, come up with a set of priorities and take action on those." Both the flexible framework and methodology are in Procuring the Future which is available at http:/www.sustainable-development.gov.uk/publications/procurement-action-plan/index.htm.
Posted on 18th January 2007
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