What is sustainable procurement? 

A practical guide to sustainable procurement, from understanding the key principles and ISO 20400 to embedding sustainability across the procurement lifecycle.

Sustainable procurement means buying in a way that has “the most positive environmental, social, and economic impacts possible across the entire life cycle and that strives to minimise adverse impacts.” This definition comes from ISO 20400:2017 Sustainable Procurement Guidance. In practice, it means looking past the price tag to how something is made and what happens to it afterwards, and letting that change what you buy. 

It has been driven by the growing awareness of environmental degradation, social inequalities, and the increasing demand for responsible business practices. 

In 2010, the publication of key standards such as BS 8903:2010 (now withdrawn and superseded by ISO 20400:2017) and ISO 26000:2010 set out formal guidance that modern sustainable procurement practice still builds on. 

However, it has always been intertwined with the broader sustainability agenda. Much of our environmental and social impact, whether in our personal or professional lives, stems from the goods and services we consume; we may just not be as cognisant of this connection as we should be. 

Why should organisations prioritise sustainable procurement? 

Organisations should prioritise sustainable procurement, not only to mitigate risks associated with environmental and social issues, but also to seize opportunities for innovation and efficiency. 

By integrating sustainable practices into their procurement processes, businesses can enhance their brand reputation, attract environmentally conscious consumers, and ensure compliance with increasingly stringent regulatory requirements such as Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD). 

It also saves money over time by cutting waste and, resource use, and resilient supply chains. Ultimately, embracing sustainable procurement is not just a moral imperative. That makes it a commercial decision, and it should be treated like one. 

Procurement gives organisations considerable influence over sustainability issues that sit outside their own operations. 

Carbon is a good example. CDP reported that in 2023, disclosed upstream Scope 3 supply chain emissions were, on average, 26 times greater than companies’ direct operational emissions (Scopes 1 and 2). Yet just 15% of companies disclosing to CDP had set a supply chain emissions target. 

So most of the carbon sits in the supply chain, and most companies still aren’t targeting it. If your emissions are mostly your suppliers’, your climate plan runs through procurement. 

Procurement can influence much more than carbon, too. Decisions about what an organisation buys, where it comes from, how it is produced and who produces it can affect resource consumption, waste, biodiversity, working conditions, human rights, inequality and local economies. 

The potential influence is particularly clear in the public sector. UNEP estimates that public procurement accounts for 13-20% of GDP in many countries, representing around $9.5 trillion in annual global spending. UNEP argues that this purchasing power can provide market incentives for more sustainable products, services and business practices. Put plainly, when buyers that size change what they ask for, suppliers have every reason to change what they offer. 

For individual organisations, sustainable procurement can help to: 

• reduce environmental impacts, including carbon emissions and resource use 
• identify and manage supply chain risks 
• support fair working practices and human rights 
• create social and economic value 
• encourage supplier innovation 
• improve supply chain resilience 
• align purchasing decisions with wider organisational sustainability objectives 

It is therefore much broader than simply “buying green”. 

What are the key principles of sustainable procurement? 

Effective sustainable procurement starts with understanding what matters. 

A common mistake is to put the same sustainability requirements into every procurement exercise. A construction contract, IT purchase, catering contract and professional services tender have very different impacts and opportunities. 

A good place to start is by identifying where procurement can have the most impact.  

A materiality or risk assessment can help an organisation identify its most significant sustainability risks and opportunities across categories and subcategories. Procurement teams can then concentrate effort where it will have the greatest impact. 

At Action Sustainability, we used this approach with the National Trust, carrying out a materiality assessment across categories including Gardens & Outdoors, IT, Retail/Commercial/Marketing and Construction & FM. The process considered issues including climate and carbon, circular economy and waste, nature and biodiversity, supplier diversity, employment and labour standards. The resulting heatmaps gave teams a clearer view of sustainability priorities at category and subcategory level. 

Other important principles include considering whole-life impacts and costs rather than purchase price alone, engaging suppliers early, setting proportionate requirements, being transparent about expectations and measuring outcomes. 

Most importantly, sustainability needs to be integrated into procurement rather than added at the end. 

What does sustainable procurement look like in practice? 

Sustainability can influence decisions throughout the procurement lifecycle. 

1. Identifying the need 

Sustainable procurement starts before anything is bought. First, consider whether the purchase is needed at all. 

Before going to market, organisations can challenge demand, explore whether existing assets can be reused and consider alternative ways of meeting the requirement. 

2. Developing the procurement strategy and specification 

Once the need is clear, relevant sustainability priorities can be translated into the procurement strategy and specification. 

Requirements should reflect the material risks and opportunities associated with the contract. Asking every supplier every sustainability question creates work without necessarily improving outcomes. 

3. Assessing and selecting suppliers 

Supplier selection provides an opportunity to understand whether potential suppliers have the capability, systems and practices needed to manage relevant sustainability issues. 

The evidence requested should be proportionate. What is appropriate for a major, high-risk contract may not be appropriate for an SME bidding for a relatively low-risk piece of work. 

4. Evaluating tenders 

Where sustainability is material to the contract, it should influence evaluation. 

Clear criteria allow suppliers to understand what good performance looks like and demonstrate how they will deliver it. 

5. Managing contracts and suppliers 

Contract award is not the end of sustainable procurement. 

KPIs, supplier engagement, performance reviews and improvement plans can turn tender commitments into measurable results. Working collaboratively with suppliers can also identify innovations and opportunities that were not apparent when the original specification was written. 

This is why sustainable procurement needs to be embedded across the entire process rather than reduced to a questionnaire at the tender stage. 

How do you develop a sustainable procurement strategy? 

There is no single sustainable procurement strategy that works for every organisation. A practical approach usually involves several steps: 

1. Understand your priorities. Start with the organisation’s sustainability objectives, business strategy, stakeholder expectations and relevant regulatory or client requirements. 
2. Assess materiality. Identify where significant environmental, social and economic risks and opportunities occur across procurement categories and supply chains. 
3. Set clear objectives. Translate those priorities into procurement objectives that teams and suppliers can understand. 
4. Embed them into procurement. Sustainability needs to appear in the relevant policies, category strategies, specifications, tender questions, evaluation criteria and contracts. 
5. Build capability. Procurement professionals need the confidence and knowledge to apply sustainability requirements appropriately. Sustainability teams also need to understand how procurement actually works. 
6. Engage suppliers. Explain priorities, listen to suppliers and create opportunities for collaboration and innovation rather than relying solely on compliance. 
7. Measure and improve. Establish meaningful KPIs and use the results to improve future procurement decisions. 

Our work with Siemens Mobility UK, for example, began by evaluating procurement operations against ISO 20400 and considering client, legislative and regulatory requirements. This informed an action plan designed to embed sustainability more consistently into procurement and category management. 

What are the common challenges with sustainable procurement? 

The challenge is rarely a lack of sustainability topics to address. More often, organisations struggle to turn broad ambitions into practical procurement decisions. 

One problem is trying to do everything at once. A long list of sustainability requirements may look comprehensive, but it can dilute attention from the issues where procurement has the greatest influence. 

Another is introducing sustainability too late. If requirements appear only when a tender is issued, opportunities to challenge demand, engage the market or redesign the specification may already have been missed. 

Data can also be challenging. Organisations increasingly want evidence of supply chain performance, particularly around carbon and social impacts, but suppliers have different levels of maturity and capability. 

The answer is not necessarily to request more data. It is to be clearer about why information is needed, what decisions it will inform and what outcomes the organisation is trying to achieve. 

What is ISO 20400? 

ISO 20400:2017 – Sustainable procurement – Guidance is the international standard providing guidance on integrating sustainability into procurement. It applies to organisations regardless of their activity or size and was confirmed as current following its review in 2023. 

The standard covers areas including accountability, transparency, ethical behaviour, respect for human rights, risk management and priority setting. It also provides a framework for aligning procurement with wider organisational goals. 

Importantly, ISO 20400 is a guidance standard, not a certification standard. Organisations can use it to understand their maturity, identify gaps and establish priorities for continual improvement. 

Action Sustainability played a role in its development as part of the UK delegation and has subsequently used the framework to assess and support organisations across different sectors. 

How do you measure sustainable procurement? 

Measurement needs to go further than recording whether a policy exists or counting how many suppliers completed a questionnaire. 

There is a useful distinction between activity and outcomes. 

Activity measures might include the percentage of relevant contracts containing sustainability requirements, procurement staff trained or suppliers assessed. 

Outcome measures ask what changed as a result: How much carbon was avoided? Was waste reduced? Did employment opportunities increase? Did working conditions improve? Did the organisation reduce a material supply chain risk? 

Not every outcome will be easy to quantify, but defining what success looks like before procurement begins makes meaningful measurement much easier. 

Making sustainable procurement part of business as usual 

Sustainable procurement works best when it stops feeling like a separate sustainability exercise. 

It is about understanding the impacts associated with what an organisation buys, prioritising the issues that matter and using procurement processes and supplier relationships to improve outcomes. 

That requires good procurement fundamentals, informed people and collaboration between procurement, sustainability, operational teams and suppliers. 

At Action Sustainability, we help organisations understand their sustainable procurement, including ISO 20400, engage suppliers and build the skills needed to turn commitments into action. 

If you’re looking to strengthen your approach to sustainable procurement, get in touch with Action Sustainability to find out how we can help turn your sustainability priorities into practical action.