5 traps to avoid in sustainable procurement

What is sustainability?

‘Sustainability’ is a term that can feel hard to pin down, not least when it comes to procurement. However, it can help to think of it in terms of being the means by which we achieve our goals, rather than trying to define it as an end in itself. By making it about the ‘how’ rather than the ‘what’ we do, we can get a wider perspective which allows us to approach the task from all possible angles.

Carbon Net Zero (CNZ) is the ‘what’ we are trying to achieve, but there is more than one approach to achieving it. The only approaches that will be ultimately successful are those which are sustainable – sustainability is the ‘how’. Switching off a light is a good way of reducing your carbon footprint immediately – but if it’s in an operating theatre during surgery, it’s not a sustainable solution!

A sustainable procurement strategy reaches every corner of your commercial activities, from what and how you buy it to who you buy from and what happens after your contract is signed.

Achieving sustainable procurement is often about taking a step back and thinking about  the way each element fits into a whole. Crown Commercial Service has extensive experience in devising and delivering sustainable procurement solutions for public sector customers.

And we’re continuing to help customers on their journey towards net zero. We have identified a comprehensive range of commercial solutions in areas that can help accelerate the transition to net zero, with the options available increasing all the time.

The 5 tripwires on the way to sustainable procurement:

1. Treating it as a project – not a programme

If you’re being transactional in the procurement process and only treating it as a purchasing activity, rather than running a whole programme of work to solve a problem – you might just be switching off that light in the operating theatre.

This could be thinking “I need to replace my diesel fleet with EV” instead of thinking about the problem you are ultimately trying to solve, which is: “I need to reduce the carbon footprint of our travel activities”. You might not be considering all the elements required for the decarbonisation process such as:

• rationalising the total number of vehicles you own/lease
• failing to prepare the infrastructure required for charging
• exploring other sustainable modes of transport such as e-bikes

Take a step back and think of the bigger picture first.

2. Not engaging with the marketplace

In sustainability, everything is moving so fast that it’s challenging to keep up with all the latest innovations and technologies. Therefore we need to be speaking to our market early in the process: Suppliers are the experts and can present innovative solutions that you might not even realise are available.

Equally, they can also tell us where we are being overly ambitious and asking for things that the market is not yet mature enough to deliver, at least without significantly increasing the costs or risk of the contract.

Early market engagement is key at the start of the process – don’t risk the possibility of no-one bidding on your tender activities because the capacity is not there

3. Focusing on the day 1 costs

It’s understandable with the constant pressure on budgets that we focus on how we get the lowest cost possible for our commercial activities. However when we focus  only on the initial cost, we miss out on the massive savings potential that could be achieved during the life of the contract.

For example, when purchasing some new machinery, it’s tempting to go with the lowest capex cost, however we also need to consider the other cost benefits through the life of the contract, for example:

• improved energy efficiency reducing running costs
• access to readily available replacement parts
• increased repairability of parts
• extended lifecycle of machinery – buy cheap, buy twice

Think of the big picture – can I save more money in the long run?

4. Not thinking about the future

So you know what you want to buy today to best meet your sustainability needs – that’s a great place to start. However, we can’t overlook the importance of understanding our needs for tomorrow and making sure  our purchases will continue to help us in our overall mission.

For example, signing up to long term contracts without options for innovation and variation prevents us from being able to unlock the fast moving benefits of the advances in sustainability. Is a long term lease on that energy storage solution the best choice in a rapidly changing technological environment?

Is your sustainable solution…sustainable?

5. Focussing on the product over outcomes

Environmental sustainability is not something that you buy, it’s a continually evolving process that achieves outcomes through good and intentional commercial practices. We often get focused on buying “sustainability products” such as solar panels and EV cars, but we can’t reach net zero if we only think about buying new things to meet our reduction targets.

If we want to reach net zero, we need to consider all aspects of our impact.

For example, when looking to improve the environmental efficiency of your heating and cooling systems, you may specify the market to provide a replacement system with the highest levels of environmental efficiency. However you may have been able to achieve a significant improvement to the efficiency of the systems just by upgrading and replacing certain elements.

Suppliers will respond to the question you ask at tender, so think what problem are you looking for them to solve or what are you looking for the procurement to deliver opposed to specifying a specific solution.

Think about the ends, not the means.

The real key to sustainable procurement is to take the time to consider  a strategic approach, before getting straight into the tactics. If you are looking for further guidance in developing your sustainable procurement strategy, the CCS Sustainability team is here to help – contact them on sustainability@crowncommercial.gov.uk

For more information visit the Social Value and Sustainability pages on our website.