Sustainable procurement: a key to reaching net zero

Meeting the Scottish Government's ambitious target of net zero emissions by 2045 will require a collective effort from all quarters – the public, private and third sectors, individuals and communities – but it falls to Scotland's public bodies and local authorities to take the lead in attaining this goal. One way of doing so is by harnessing the power of public procurement.

The public sector has significant purchasing power through which it can influence products, services, supply chains and investment decisions. The Scottish Government's Climate Change Plan update published in December 2020, includes a commitment to collaborating across the public sector and mobilising the £12.6 billion spent through public procurement to support Scotland's net zero ambition.

The sustainable procurement duty

Sustainable procurement is a key consideration for the public sector. The statutory sustainable procurement duty was introduced by the Procurement Reform (Scotland) Act 2014. This duty requires contracting bodies to consider how they can use the procurement process  to improve the economic, social, and environmental wellbeing of the authority's area; to facilitate the involvement of small and medium enterprises, third sector bodies and supported businesses in the process; and to promote innovation.

An analysis of the impact and value of the sustainable procurement duty was published in December 2020. The study found that there has been a step change in procurement practice and that significant progress has been made since the duty was introduced. For example, the report describes steps being taken by public bodies to improve environmental wellbeing by the reduction of greenhouse gas emissions, increased use of renewable energy products, increased percentage of reused and recycled materials, and reduced waste to landfill.

Each contracting authority must set out in its procurement strategy how it intends to comply with the sustainable procurement duty, and must report annually on how its procurement policies and activities have taken into consideration or contributed to carbon emissions reduction targets, climate change adaptations and ensuring that the procurement activity is sustainable.

Delivering sustainable procurement

The principles of sustainable procurement apply at every stage of the procurement journey. At the outset, the contracting authority must identify and address environmental issues when preparing an invitation to tender. Relevant factors may include manufacture and production methods; logistics and transportation; the re-use, recycling, re-manufacture and final disposal of materials; supply chain sustainability; and tenderers' environmental policies.

Engaging with suppliers before the procurement process formally begins provides an opportunity to set expectations and allow the market to understand and prepare their response to tender requirements, as well as allowing the contracting authority an opportunity to better understand the market and what potential solutions are available.

A comprehensive set of sustainable procurement tools is available to help public sector organisations identify and address how they can optimise the economic, social and environmental outcomes of their procurement activity. Sustainable procurement guidance has also been produced to support these tools.

Circular procurement

Circular procurement goes even further than existing sustainable procurement practices. Circular procurement involves actively contributing to closing energy and material loops within supply chains, and minimising negative environmental impact or waste creation across the whole life cycle of products and services. The principles of circular procurement can be summarised using the waste hierarchy – Reduce, Reuse, Recycle, and Recover.

Zero Waste Scotland is engaged in an ongoing circular economy procurement project called ProCirc. ProCirc was set up in 2018 to experiment, implement and learn about how circular economy and procurement can benefit the North Sea region. ProCirc participants are focused on development of circular business models, products, and services through implementing changes to public and private procurement. In Scotland these pilot projects include Playground equipment, Edinburgh City Deal, Education and office furniture, Domestic furniture and Aberdeenshire council estate refurbishment and construction.

The transnational ProCirc project will continue to run until June 2022. The lessons learnt from the various procurement exercises will then be shared and adopted into mainstream practice.

The Climate and Procurement Forum

Following on from the Scottish Government's declaration of a Global Climate Emergency in April 2019, the Public Procurement Group (PPG) established a Climate and Procurement Forum, chaired by Scottish Government with representatives from across the public sector. It met for the first time on 11 November 2019 and is working to establish a consistent and robust approach to addressing climate concerns through procurement.

The group is pursuing five work streams which reinforce the sustainable procurement duty: strategy and objectives; people and capability; supplier and market engagement; operations; and monitoring and reporting.

The extensive knowledge and experience of public sector, business and climate experts from across Scotland is being combined in this forum and one of its first outputs is a Scottish Procurement Policy Note (SPPN), Taking account of climate and circular economy considerations in public procurement (SPPN 1/2021), published on 20 January 2021.

Looking ahead

Tackling climate change is becoming increasingly urgent, and is in sharp focus in the UK this year due to the delayed UN Climate Conference – COP26 – which will bring world leaders together in Glasgow in November 2021 to accelerate action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change.

There is no doubt that public bodies and local authorities have a key role to play in the battle against climate change, not only in complying with legal obligations to reduce their own carbon emissions but by actively encouraging their partners, suppliers and stakeholders to do the same.

Well designed and implemented procurement processes underpinned by the sustainable procurement principles and, where possible, circular procurement principles, are a powerful tool through which the public sector can influence behaviour and contribute to achieving Scotland's net zero ambition.