How to improve sustainable public procurement

By Ulrick Sebber – Associate Partner, Lars Thorgaard Henriksen – Associate Partner, Erik Lind Olsen – Partner

Most public organisations have formulated ambitious strategies to achieve sustainability and reduce their carbon footprint. While boards and governments continue to battle for the green votes by setting even higher targets for reducing emissions – from 70% in 2030 to net zero or even to net positive – the demand for organisations to execute and realise significant ambitions for sustainability increases.

What is your sustainable procurement strategy to reach the targets?

Apply differentiated strategies

Aside from fuel, utilities and food, which are the main contributors to carbon emissions in public procurement, it is essential to gather data insights to distinguish between the other main contributors of carbon emissions and identify which categories are next in line in your organisation.

Then, develop the appropriate strategy tailored to the specific category. There is no “one fits all” solution; you must scope the strategies individually and balance environmental, social, ethical and labour considerations along with the specific requirements for the quality of the services and products of the category.

Example: In construction, you may need to strike a balance between using apprentices in projects, strengthening the use of recircled material and increasing the use of electrical machines while not compromising the specific requirements of the quality of the material and giving in on the total cost of ownership.

Develop category activity plans for sustainability and adopt a proactive approach

Different category strategies addressing specific relevant issues must be supported by individual plans for implementation. This includes substantial preparations and dialogues with suppliers regarding how they incorporate environmental, social, human ethics and labour elements in their operations. Rather than using the dialogues prior to the public tendering processes to evaluate quality and price in the market, sustainability should be discussed explicitly and much earlier in the process. When planning, don’t forget to include the necessary recruitment and training in the procurement department to support the planned initiatives and avoid delays.​

Suppliers are eager to compete and want to be recognised for their deliverables and the quality of their products and services. However, they also want to be recognised as companies that take responsibility. Don’t underestimate the power of explicitly addressing your ambitions and expectations for your suppliers’ responsibility. Encourage their effort to be more sustainable.

Example: Use the right procedure in the European public procurement legal framework: Use the restricted procedure to qualify suppliers instead of the open procedure. The restricted procedure in public procurement offers the same advantages as the quicker open procedure, but with the added benefit of evaluating suppliers on their environmental, quality and supply chain management systems and tracking systems. These are all legitimate criteria that should be used in selecting suppliers.

Incorporate sustainability in collaboration and performance reviews of suppliers

Public tendering processes often focus on criteria evaluation and product and service specification, leaving out the operational aspect of collaboration between the supplier and the public organisation. Use the opportunity to incorporate the requirements in contracts and specifications on how to collaborate regarding sustainability.

Example: Centralise supplier and contract management and incorporate quarterly reporting of e.g., scope 3 emission in the reporting set-up. By evaluating sustainability throughout the lifetime of the contract and measuring the performance in the execution of the contract, you can influence:

  • The protection of the environment, minimisation of environmental risks and promotion of sustainable aspects throughout the lifetime of the contract
  • Health and safety for employees
  • A sustainability-oriented culture between the public organisation and the supplier(s)

Measure, report and learn

Need more guidance on how to improve sustainable procurement in your organisation? Let us help you assess where to focus and what steps to take.

Want to learn more? If you would like to learn more about how Valcon can help your organisation to improve sustainable procurement in your organisation, please contact [email protected] (+45 3080 2985) or [email protected] (+45 2787 2127) and we’ll be in touch right away.