Last edited 23 Oct 2020

Sustainable procurement

Sustainability is a broad term describing a desire to carry out activities without depleting resources or having harmful impacts, defined by the Brundtland Commission as 'meeting the needs of the present without compromising the ability of future generations to meet their own needs.' Some broader descriptions also include consideration of social and economic welfare.

Sustainable procurement is the process of adopting procurement strategies and making decisions in a way that supports wider social, economic and environmental factors.

In 2006, the Sustainable Procurement Task Force defined sustainable procurement as:

A process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and the economy, while minimising damage to the environment.

Sustainable procurement assesses value for money in terms of the wider benefits to society, the economy and the environment as well as the narrower benefits of the procuring organisation. This might include consideration of lifecycle impacts, environmental impacts, social impacts, and so on. These extrinsic cost considerations are factored into decisions alongside the conventional procurement criteria of price, quality, time, and so on (see Selection criteria for more information).

Some of the advantages of sustainable procurement include:

In construction, sustainable procurement might involve consideration of the environmental, social and economic consequences of: :

Sustainable procurement involves close collaboration and engagement between all parties in the supply chain, and supplierscapabilities to address these factors should be carefully considered during the selection process.

ISO 20400:2017 provides guidance to organisations on integrating sustainability within procurement, and is intended for stakeholders involved in, or impacted by, procurement decisions and processes. (This superseded BS 8903:2010.)

The sustainability objectives of an organisation should be addressed as early in the procurement process as possible. This might include:

However, there is no ‘one size fits all’ solution and projects need to consider their unique local environmental, social and economic effects. The geographical location of a project should be considered alongside the objectives of the client and any external stakeholder requirements and the capabilities of the supply chain. Sustainability impacts and risks should be mapped against categories of supply.

By operating the business more efficiently, demand can be kept to a minimum. This requires an organisational link between the procurer and the user.

Innovation should be encouraged and a competitive, sustainable supply chain developed. If a supplier with lower sustainability credentials is selected for other reasons (such as technical capabilities), they should be contractually obliged to develop a programme of work to improve.

An impact measurement process should be adopted, that is linked to the organisation’s strategic sustainability objectives so that meaningful steps can be taken to support their delivery. The organisation should develop an impact measurement tool so that these can be monitored effectively, with the results fed back against corporate objectives. This might be done for example by adopting a Key Performance Indicator (KPI) approach.

CIRIA's Guide to sustainable procurement in construction, published in 2011, set out the following guiding principles to sustainable procurement:

- it is the role of the buyer to procure sustainable solutions that offer equal or better value over their life than the traditional alternatives - understand what sustainability outcomes are to be achieved and the reasons for doing this. If they are not being done to mitigate a risk, reduce cost or to achieve a client ambition then perhaps reconsider - understand the supply chain. Buyers should already know where excessive costsmay lie but life cycle costs, excessive risk, sustainability impacts and opportunities must also be considered - take ownership of the supply chain and provide guidance regarding sustainability requirements.

Work in partnership with suppliers as delegating requirements to tier one suppliers to manage may not be sufficient - understand the client’s sustainability ambitions and the unique circumstances of the project. Develop meaningful and objective measures to address this - do not be tempted to adopt a “one size fits all approach”, each construction project and its associated procurement is unique and will have different drivers and different sustainability risks and opportunities - before buying, re-think/challenge the need for the project/product/service.

Work with stakeholders and clients to explore if the need can be met without a procurement taking place - ensure supply chain are involved as early as possible in the project to ensure expertise is harnessed and whole-life value is secured - the process of procurement in construction can range from an in depth market analysis, tender and evaluation process to a simple work instruction to a subcontractor. Irrespective the approach to sustainability requirements should be made clear from the start - ensure supply chain sustainability requirements are contractually enforceable wherever possible. In all cases agree objective measures so that non-compliance is highlighted and corrective actions can be quickly identified - always take time to review lessons learned, record what works and do it again.

Share this knowledge to promote better sustainable procurement practices across the industry.

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