ESG & Procurement
More and more attention is also being paid to ESG-related issues in the field of procurement and tendering. This is often linked to the concepts of sustainable and socially responsible procurement ('SRI'). The European Commission has also put this topic on the map under the title Green Public Procurement. Already in 2016, the third version of the handbook 'Buying green!' was published by the European Commission containing guidelines and opportunities for greening public procurement. February 2023 also saw the publication of the Manifesto 'Socially Responsible Procurement and Procurement', supported by more than 90 (semi-)public organisations. The manifesto focuses on encouraging ambitious socially responsible procurement and purchasing.
Socially responsible procurement in practice
More and more public authorities and other public law institutions (subject to public procurement) are recognising the importance of socially responsible procurement. This theme is also emerging more often in tenders. Various substantive angles and focal points are conceivable here, such as:
- Circular procurement (where products, components and raw materials are reused after the end of their useful life)
- Social return on investment ("SROI"), whereby contractors commit to engage in labour participation of people distant from the labour market) or diversity and inclusion.
In the procurement process, SRI themes emerge in various formal manifestations. These can include:
- Suitability requirements imposed on bidders (consider certain certification requirements)
- Minimum requirements (e.g. an obligation to spend a certain percentage of the contract value on SROI when performing the contract).
- It is also possible to award the contract to the tenderer who has submitted the bid with the lowest cost calculation based on cost-effectiveness - such as life-cycle costs
The use of this award criterion takes into account not only the costs to be incurred by the contracting authority to acquire products or services, but also the costs to be attributed to environmental externalities related to those products or services.
Finally, SRI themes can play a role in the assessment of tenders and are thus scored with points, in order to select the tender with the best value for money. For example, lower CO2 emissions can lead to a higher rung (ambition level) on the so-called CO2 performance ladder and therefore result in a better assessment and a higher score for the tender. The same is the case, for example, for a low Environmental Cost Indicator value ('EQI value'), which determines the environmental cost of a design of a work to be realised.
What can Van Benthem & Keulen do for you?
From a political and/or policy perspective, it can be highly desirable or even mandatory to pay attention to one or more SRI themes in a tender. Yet for buyers and government lawyers, it is often still a search for the possibilities and impossibilities that exist in this area. The lawyers in Van Benthem & Keulen's Procurement Law team have extensive experience in advising and litigating on the design of procurement procedures and keep a close eye on developments in this area. They will be happy to think along with you.
