How can sustainable procurement support your Net Zero journey? July 2022

The international standard for sustainable procurement, ISO 20400, has been around for five years, giving us internationally accepted best practice on how to purchase goods and services in the most sustainable way possible. We’ve supported many organisations – from sectors as diverse as construction, government, FMCG and manufacturing – in evaluating and building their competence and delivery of sustainable outcomes through procurement.

While we see a push on all areas of sustainability through procurement, climate change and carbon come out as priorities time and time again, no matter what the organisation does.

Why? Well, there are many external drivers – legislative and voluntary – for addressing both your own carbon emissions and those of your supply chain, with a bewildering array of acronyms: SECR, PPN 06/21 and SBT, to name but three of them. And then there’s Net Zero Carbon, which essentially means reducing your emissions and those of your value chain as far as possible and as close to zero as possible.

To put some context on this, depending on where you sit in the value chain, between 70% and 99% or more of your overall carbon emissions and impacts can come from your value chain; your scope 3 emissions. And this leads us to procurement…

Here’s a real-world example that describes this. Working with a major UK University, Action Sustainability calculated that their supply chain (scope 3) emissions are 75% of all their greenhouse gas emissions. In other words, scope 1 and 2 emissions from direct fossil fuel use and electricity consumed on site only account for a quarter of their emissions. The scope 3 emissions comprise business travel, commuting, waste, water, and procurement of goods and services.

And this is the kicker: the last category accounts for two-thirds of their scope 3 total. In other words, buying the products and services they use leads to 50% of all their GHG emissions, with construction, laboratories and IT being the biggest sources.

Depending on where you sit in the value chain, between 70% and 99% or more of your overall carbon emissions and impacts can come from your value chain.

So, what can you do?

Use ISO 20400 as your framework and roadmap for understanding where the risks and opportunities for carbon emissions lie in your supply chain. The Standard calls this prioritisation – we call it heatmapping. It all amounts to the same thing: RAG rating where there is high probability of carbon emissions occurring in your supply chain that you can influence. Some tips:

• Convene a group of internal stakeholders such as procurement, commercial, sustainability / HSE, estates management, operations, and fleet – anyone who has an influence on spend in your organisation
• List the main categories that you procure, for example, transport & logistics; materials such as concrete, steel, glass, plastics and chemicals; IT; catering; and labour
• Describe the life cycle key stages of the goods and services with respect to where carbon emissions can occur, e.g. during manufacture; from delivery; in use; and from disposal at end-of-life
• Work with your colleagues to RAG rate the categories of spend against the life cycle stages: give a RED where there are large GHG emissions AND you have influence with the supply chain AND there is something that can be done to reduce them. Give an AMBER where two of these aspects are true, and a GREEN where only one or none of them are true
• Capture ideas on actions you can take for the REDS. For example, switching to lower embodied carbon materials, moving your fleet towards more EV, and procuring equipment that is more energy efficient.
• Use the heatmap as a core part of your procurement strategy, keeping it under review

Following these simple steps can get procurement and your supply chain contributing to help you get to where you want to be on your journey to Net Zero Carbon.

Putting this into reality, Action Sustainability recently supported a collaborative group of Local Authorities to do just this. We built a Low Carbon Procurement Toolkit with a risk and opportunity approach to life cycle carbon at its core. The Toolkit contained the heatmap with model ITT questions and responses, supported with an overarching Policy, and Supply Chain Charter to communicate their intentions with the supply chain. This now gives the Authorities a consistent and detailed approach to engaging their suppliers on carbon in the move towards Net Zero Carbon.

Want to know more about how to do this? Contact Head of Consultancy James Cadman.