Sustainable procurement: How green initiatives help win government bids

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Climate Change is a long-term issue that businesses can help address through meeting some of the Victorian Government’s sustainable procurement objectives.

Since the Victorian Government’s social procurement framework came into effect in 2018, almost every government RFT has included one or more questions about the bidder’s policies and practices in support of the framework’s social and sustainable procurement objectives.

The framework is mandatory for individual government procurement activities that are $1M or more in regional areas and $3M or more in metro or state-wide. On top of this, the framework’s objectives are being incorporated into the requirements for many smaller government projects.

While the seven social objectives are important (see our earlier post), it’s also important to heed the three environmental/sustainable procurement objectives. (It might be hard to think about anything other than COVID19 just at the moment, but let’s not forget about the urgent need to combat climate change, as demonstrated by our horrific bushfire season.)

sustainable procurement
Image by annca from Pixabay

So, in this post we’ll outline the environmental sustainability aspects of Victoria’s social procurement framework and explore how businesses can achieve them. (Please also refer to our earlier Government Insight post with Fiona Sergi from Sustainability Victoria.)

There is growing recognition that the public and private sectors need to be more proactive in how they identify and address climate change and sustainability risks in relation to the assets they build, own and operate. This extends to service providers: does your business have the appropriate processes and procedures in place to mitigate any of these risks against the services you provide?

Moreover, whether or not you are planning to provide services to government, addressing some of the environmental/sustainable procurement objectives can help position your organisation to be more resilient against the risks of climate change and drive sustainability outcomes.

The framework’s environmental objectives

As discussed, three (out of 10) objectives within the social procurement framework are focused around environmental sustainability.

Environmentally sustainable outputs       

  • Project-specific requirements to use sustainable resources and to manage waste and pollution
  • Use of recycled content in construction works

Environmentally sustainable business practices

  • Adoption of sustainable business practices by suppliers to the Victorian Government

Implementation of Victoria’s Climate Change Policy objectives           

  • Project-specific requirements to minimise greenhouse gas emissions
  • Procurement of goods and services that are resilient against the impacts of the climate change

These objectives focus on how to achieve positive environmental outcomes, while also achieving value for money and minimising impact to the environment. Weighting for these objectives can be up to 10% of the total score.

You can think about how you can address these objectives in two ways: Production and Consumption.

Production: Your product and how you’re producing it

To meet framework objectives:

  • Environmentally sustainable outputs
  • Climate Change Policy (partially)

According to current projections by the United Nations, if the world continues its current population trajectory, the equivalent of almost three planets could be required to provide the natural resources needed to sustain current lifestyles*. Therefore, we need to think differently about how we create products.

If you are providing products or services to government, consider the following to reduce your carbon footprint:

  • Can you introduce recycled content into your product/service?
  • What about the packaging and logistics you use? Are there recycled materials that you can use instead of ‘virgin’ plastics and paper? Are there alternative ways to transport your product?
  • Can you use sustainable resources to produce your product/service? (i.e. renewable energy, recycled materials)
  • Consider any environmental impacts you may have in providing your service or product (e.g. are you safely storing, transporting and disposing of hazardous substances including waste? are you minimising the loss of biodiversity, deforestation, damage to ecosystems and/or greenhouse gas emissions?)
  • Consider ‘circular procurement’ of your products and services. This is where purchasers seek to contribute to closed energy and material loops within supply chains, whilst minimising, and in the best case avoiding, negative environmental impacts and waste creation across their whole life cycle.

Also consider your supply chain, particularly if you need to purchase materials in order to develop or create your product (more on this in the consumption section below). If you can collaborate or work with a social enterprise in developing your product or service, that will also put you in good stead to meeting any social procurement objectives.

For example, a lot of Victoria’s major rail and road projects have been using recyclable and recovered content, while also minimising waste and greenhouse gases, preventing habitat destruction and sourcing non-toxic solutions. This includes recycled crushed concrete/masonry, recycled plastic sleepers for train networks and recycled glass sand for bedding materials. Downer Group, Hume City Council, Close the Loop and Red Group have also developed a soft plastic asphalt made from reclaimed asphalt, toner from printer cartridges and soft plastics.

Globally, there are innovations occurring around the world, particularly in packaging. Dell has committed to testing renewable packaging materials to drive cost and environmental savings (such as bamboo packaging, pulp from sugar cane and mushrooms to create a bio-based biodegradable product that resembles styrofoam).

Infrastructure ratings

If you are tendering for government projects that fall within the social and sustainable procurement thresholds, you may be required to commit or demonstrate how you meet industry standards and rating systems. There are two rating systems that the Victorian Government has referenced for registering infrastructure projects: Infrastructure Sustainability Council of Australia (ISCA) and Green Building Council of Australia (Green Star).

Infrastructure Sustainability Council of Australia (ISCA)

ISCA is a performance and outcomes-based framework that evaluates sustainability across the planning, design, construction and operational phases of infrastructure programs, projects, networks and assets. Sustainability performance is evaluated against governance, economic, environmental and social measures of infrastructure development. Projects are awarded points based on a score out of a possible 100, and ratings are “Commended”, “Excellent” or “Leading” depending on the final score.

Green Building Council of Australia (Green Star)

The Green Star framework is a voluntary rating system for buildings in Australia. There are four separate rating systems covering: community-scale precinct development, the design and construction of a building, the retrofit of a building, and the operational performance of a building. Certification ranges from one (minimum practice) to six stars (world-leading).

For example, Rail Projects Victoria mandated the Metro Tunnel Project to achieve an ISCA rating of “Excellent” and a 4-star rating from Green Star.

Environmental management plan

Businesses are also encouraged to maintain an environmental management plan that describes how an action might impact on the natural environment in which it occurs and outlines clear commitments on how the impacts will be avoided, minimised and/or managed so that they are environmentally acceptable.

Consumption: What do you use and how are you minimising waste?

To meet framework objectives:

  • Environmentally sustainable business practices
  • Climate Change Policy

There may be many simple things you can do within your business to reduce your environmental impact. Things such as your energy and water use, waste management and recycling can all contribute towards your business’s carbon footprint (or your environmental impact based on the business’s consumption of resources).

If you haven’t already, consider developing and implementing an environmental policy in your business. This should also include key performance indicators and targets to help your business track and measure your consumption and use against environmental impacts.

Here are some things you can consider:

  • Are your office lights energy efficient? Can you use energy-efficient lighting (such as LED light bulbs)?
  • If you own your office building: do you use renewable energy sources, including solar panels?
  • What can you do to minimise your office waste going to landfill? Do you have a recycling practice in your kitchens? Can you switch your business to a paperless office?
  • Do you have carbon offsets for flights? You might also want to consider carbon offsets for the energy use in your offices, particularly if you are leasing offices.
  • Where do you purchase your office supplies? Do you try to choose supplies (such as paper) that use recycled materials?

There are also many pledges, memberships and/or conventions that can help your business achieve environmental goals and sustainable business practices.

For example, the Victorian Government’s collective climate change pledge is the TAKE2 Pledge. Mia recently signed up to the TAKE2 Pledge, joining 118,000 organisations to contribute to reducing Victoria’s carbon emissions by 20%. We’ve pledged to undertake a range of sustainable business actions to fight climate change (see our pledge page).

While meeting the above outlined environmental objectives will help your business do its bit to combat climate change, it’s important to be able to communicate your initiatives in your bids to demonstrate how your meeting government sustainable procurement objectives. Whether or not compliance is mandatory, establishing constructive company policies goes a long way to differentiating your business from its competitors.

 

* Should the global population reach 9.6 billion by 2050, the equivalent of almost three planets could be required to provide the natural resources needed to sustain current lifestyles.
United Nations (UN), Sustainable Development Goals – Goal 12, Facts, Accessed: https://www.un.org/sustainabledevelopment/sustainable-consumption-production/ on 3 March 2020

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