It could be said that this is our first climate change recession. In the early 1990's, the expression carbon footprint was unheard of, Google had not been invented, we were unaware that landfill capacity was running out and that we would need 3 planets to sustain the rate of consumption in Western Europe.
Another feature of this recession is the level to which organisations rely on others to do the things they do. The level of our-sourcing, off shoring, partnering and sub-contracting is without precedent. This, combined with the notion that organisations need to find ways of tackling their environmental, social and economic impacts gave rise to the notion of sustainable procurement.
Sustainable Procurement Task Force Chair, Sir Neville Sims sums up the concept as "Using procurement to support wider economic, social and environmental objectives in ways that offer real long term value". Sustainability through the supply chain should not be an optional extra, it should be embedded in everything we buy. There are many reasons to do this. Public sector bodies are driven increasingly by legislation and policy to deliver ever more sustainable outcomes. Given that the majority of service delivery is through the supply chain, this has an impact on first tier suppliers and onwards down the supply chain. Far sighted companies such as Marks and Spencer see their Plan A as a way to transform their business to the sort of carbon neutral and zero waste retailer they think their customers will want in the future They are suffering hard times now but they still keep the faith, the recession will not last forever but issues such as climate change will remain and the recession survivors will have to tackle them. Given the inevitability of tax increases in the next few years and the environmental issues we face, it does not take a genius to work out that polluters will pay more in future. It makes great sense to use less energy, consume fewer resources and throw fewer things away. Smart organisations are also considering risk. One of our clients was recently exposed in the national press for employing labour from Latvia for £8 per day. This happened several tiers down the construction supply chain and the client had no idea it was happening until they saw in on the front page of the Guardian. In good times such bad publicity can be damaging, in difficult times, it can be fatal.
There are some great examples of sustainable procurement around the world. The Swedish government had the courage to consolidate its vehicle procurement to encourage auto manufacturers to develop a more sustainable product. The resulting Saab bio-ethanol engines may not save the planet but it is a great example of using procurement power to create something that did not previously exist. The UK public sector is not far behind. Every year, the Prison Service sends 40,000 mattresses to landfill and purchases 60,000 new mattresses. The innovative tender for a mattress that is made from 100% recycled materials and is 100% recyclable at the end of its life has revolutionised an industry. The result of this procurement is a massive diversion of waste from landfill and a significantly reduced cost. The London 2012 Olympics will set new standards of sustainability. A good example is the treatment of concrete procurement by the ODA, which has led to supply with 50% less embodied carbon than Heathrow Terminal 5. This potentially saves over 1M Tonnes of CO2. There is also evidence that sponsors find this proposition attractive and are prepared to sign up as "Sustainability Sponsors" to be associated with the most sustainable games in history.
The big barrier to all this is around the "how", procurement professionals are not trained in these issues and conventional procurement strategic thinking does not take it into account. The Task Force came up with the Flexible Framework as a way of articulating best practice and many organisations have found this very helpful. The idea is to address every aspect of a procurement organisation from recruitment and training, through processes, supplier engagement and measuring results. The biggest challenge in getting started is often in definition. Very few organisations can say what they actually mean when they talk about "Sustainable Development", "Corporate Social Responsibility", Ethical Business etc. Procurement is a very precise and formal process, it needs clear definitions and goals to operate successfully and there is a need to define precisely what impacts we are trying to address. For example, Marks & Spencer Plan A includes the carbon impact of their customers washing, drying and ironing clothes in their carbon footprint. This has led to their supply chain developing products that can be washed at low temperatures, don't need ironing and use a minimum of drying time. London 2012 decided to include the energy embodied in construction products into the carbon footprint of the games, this has resulted to an approach to procurement of concrete and other products that will revolutionise the construction industry and make UK PLC more competitive on a global stage.
However, there is very little support out there for people to do this. All this prompted me to leave a well paid job in a major corporation to start a social enterprise to provide public and private sector bodies with the help and support they need. Along with 2 colleagues, Barbara Morton and Russell Foster, we started Action Sustainability in 2006. Our mission is to inspire sustainable procurement and we have had great success providing training, consultancy and assistance to organisations who want to procure more sustainably. Our clients include major public sector bodies and businesses, and we have just completed our first international project. Another feature of our work is brokerage, where we act as a sort of "dating agency" to match innovative suppliers of sustainable products to procurers who want to buy them.
We want to grow a family of mutually supportive sustainable purchasers and to support this we have developed the Iceberg Group. In return for a subscription, our customers have access to our advice and support all the year round. They also have the opportunity to share their experiences with like-minded people and organisations. Customers such as United Utilities, Skanska, Marks and Spencer, Carillion, E.ON, Virgin Atlantic and others have benefited from this service which promises to help mainstream sustainable procurement to support all our futures.