Public Procurement as a Leverage for Sustainability

Public Procurement as a Leverage for Sustainability

The UK government spends roughly £284 billion on public procurement every year. With so much public money at stake, procurement needs to deliver value for money. But more and more, the public sector demands ethical value, too.

Governments can use their buying power to support ethical and environmental policy. Investing in sustainability through public procurement can contribute to global sustainability goals. But how can governments follow through on the promise of green public procurement?

Keep reading for more information on public procurement for sustainability.  This post will cover why it matters, what it can achieve, and how the government can do better.

Why Does Sustainability Matter?

All over the world, governments are committing to the principles of sustainability. Many sustainability initiatives pertain to the environment, and to carbon emissions in particular. Carbon neutrality and net-zero emissions policies are popular with businesses around the world.

Yet sustainability is not only about the environment. Sustainable businesses do work to reduce waste and address climate change. But in the world of public procurement, businesses should also:

  • Create local jobs
  • Bolster the local economy
  • Treat employees well
  • Improve supplier diversity
  • Build supply chain resilience

The pandemic has shown us how fragile our global supply chains can be. Sustainable businesses deliver social value by investing in local communities and supply chains. They improve the UK’s resilience by reducing dependence on the rest of the world.

Working with local businesses can also improve the government’s carbon footprint. It means that governments can deliver goods and services with minimal environmental impact.

Public Procurement for Sustainability

When it comes to sustainability, governments must lead by example. They can set clear policies and then adhere to them themselves. This shows other sectors that they can prioritise sustainability while maintaining financial value.

The UK government spends almost one-third of public money on procurement every year. Investing that money in sustainable businesses sends a signal to the private sector.

Government contracts are desirable: they pay well, guarantee consistent work, and bolster credibility. As a result, competition for public sector work is steep. Businesses know that they need to meet high standards to make a competitive bid.

That knowledge encourages innovation in the private sector. Businesses have an incentive to develop new approaches to sustainability. Over time, the development of sustainable products and services stands to benefit everyone.

The shift toward sustainability trickles down from the government through the economy. Public procurement for sustainability can deliver immense social value to the UK.

How to Leverage Businesses to Improve Sustainability

As a force for social good, sustainability is hard to deny. But how can public sector buyers encourage businesses to improve sustainability? Here are a few ways to leverage your suppliers for a better world.

Incentivise Sustainability

The private sector innovates in response to competition. As a government buyer, you can promote competition through procurement policies. Creating incentives for suppliers will encourage them to shift their approach.

A government contract can be an incentive in its own right, offering good pay and credibility. But inviting businesses to compete for rewards will do more to promote innovation.

Consider the following incentives for businesses that meet government standards for sustainability:

  • Tax cuts
  • Tax credits
  • Public awards

Apply your understanding of the private sector to your public procurement policy. That way, you can encourage the industry to fall into line with government standards.

Work with Local Suppliers

It can be tempting for government buyers to focus on up-front costs. That’s how global companies like Amazon and Dell win public sector contracts. Often, they can outperform local suppliers by offering raw value for money.

But sourcing goods and services from other countries can reduce social value. The need for shipping can increase your carbon footprint. In a post-pandemic world, global procurement purchases also risk delays in transit.

Buying from other countries also contributes very little to the UK economy. Using UK suppliers can return public money to local communities. This could create new jobs for UK workers, bolstering the economy at home.

Working with local suppliers shows them that they can compete with global players. By focusing on delivering sustainability, they can make successful bids for government contracts. Over time, this will encourage UK industry to prioritise sustainability.

Track Your Impact

If you don’t pay attention to your results, you can’t be sure that your policy is working. That’s why it’s crucial to measure the impact of sustainable public procurement.

Government buyers should develop collaborative relationships with their suppliers. Together, buyers and suppliers can track the impact of their collaboration. Whether financial, social or environmental, it’s important to understand the benefits of a partnership.

This will enable all parties to identify areas for improvement. But knowing the strengths of sustainability can also offer immediate benefits.

Businesses can market themselves as leaders in sustainability. They can then reap the rewards of consumer interest in social value. They can also build credibility within their industry, and inspire other businesses.

And government buyers can point to the effectiveness of their sustainability policies. This can pave the way for further pushes for green public procurement.

Public Procurement Leading the Way

As a buyer, you have a duty to source sustainable goods and services. But if you’re new to sustainable public procurement, it can be hard to know where to begin.

Delta eSourcing can give you the foothold you need. We provide secure online solutions to shore up your procurement strategy. No matter where you are in the process, we can help you achieve true value.

Contact us today, and let’s set higher standards for public procurement together.