Shifts Towards Sustainable Sourcing
A while ago, we shared an article on findings by the Boston Consulting Group and the World Economic Forum that showed procurement is responsible for 15% of all greenhouse gas emissions, globally. Their study reported that governments spend $11trillion(USD) annually-or 15% of global GDP, on procurement every year. Our own prior study, tracked the value of global procurement at $13 Trillion(USD) per year, suggesting that the greenhouse gas emissions could be even higher than the BCG findings.
Sustainable procurement is increasingly in the spotlight. In December 2020, the UK Government released their Green Procurement paper findings with the aim of placing value for money at the heart of procurement, generating social value, and unleashing opportunities for small businesses, charities, and social enterprises to innovate in public service delivery.’
Following this release, in June 2021, the Cabinet Office published Procurement Policy Note 06/21 (“PPN 06/21”) which requires suppliers who are bidding on Central Government contracts [from 30 September 2021] to commit to achieving net-zero…and to detail their organisation’s UK greenhouse gas emissions via…a Carbon Reduction Plan. The potential implications for failing to meet this selection criterion were significant with contracting authorities being entitled to exclude bidders for non-compliance. It is anticipated to have a significant impact on the behaviour and pace of carbon reduction in the [UK] Government’s supply chain.
In June this year, we worked with Open Contracting Partnership and Public to create the Sustainable Procurement Toolkit, because most governments and business are only just embarking on their journeys toward buying sustainably. It can be daunting to know where to start: How do you incorporate product lifecycle costs? How do you buy goods like produce more locally and sustainably? How can you calculate carbon emissions and source more sustainable building materials for infrastructure projects?The toolkit is designed to help answer these and other questions.
To do our part in this shift toward more greener and more transparent procurement, the Spend Network team has developed a dashboard analysis; showing the carbon emitted by the public sector’s supply chain (scope three emissions).
You can view the dashboard here. We plan to continue to develop and enhance the dashboard to be a valuable tool in improving government procurement in the UK.
If you’d like to talk to us about our government procurement data or our research capabilities, get in touch.
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