Insights Blog

  • Jon Wilton

Sustainability will be a ‘Licence to Operate’ Sooner than Expected

Updated: Jul 1

New UK Procurement Policy changes

A new UK Procurement Policy Note (PPN) has recently set out that all organisation bidding for work with Central Government Departments, their Executive Agencies and Non-Departmental Public bodies with a contract value greater than £5m per annum will need to:

“Provide a Carbon Reduction Plan confirming the supplier’s commitment to achieving Net Zero by 2050 in the UK, by setting out environmental management measures that they have in place, which will be in effect and utilised during the performance of the contract.”

The contracting authority must:

“Verify that the successful supplier meets the selection criteria prior to award of the contract or appointment to a framework agreement or dynamic purchasing system. Contracting authorities may request this evidence at any time during the procurement process where this is necessary to ensure proper conduct.”

If you think this doesn't apply to you, think again

There is a point to made about the introduction of the new ruling. It isn’t about the size of the award it is focussed on (£5m per annum and above, isn’t a small amount after all) or about the verification process being placed on the contracting authority to prove participants are abiding by the rules or that it’s focussed on the public sector. The point is that this is simply the start of things to come.

We have seen a wave of targets and statements being made by governing bodies, corporates, councils etc., relating to green ambitions and what has already been achieved to date —which is fantastic and truly promising for the whole zero carbon and climate change movement. However, very quickly verification of these actions and achievements will need to be shown in black and white.

Sustainability is no longer a nice to have, it’s your ticket to the game

At Cambridge we are talking to organisations on both side of the procurement fence. Buyers of services and products who are trying to transform their business processes to be both cost effective and sustainable and sellers of services and products who are looking to prove they are cost-effective and sustainable in their business processes.

What is consistent in either camp, is that change needs to happen and organisations need to prove they are doing what they’ve been saying. If not, don’t be surprised if they are left behind.

Let's focus on the seller. If you are a seller of services and not able to prove you are credible and true to your sustainability promises, you will find sooner rather than later, it will be a case of ‘not being allowed to play’. Put simply, your customers will not allow you to ‘pass go’.

We are seeing more and more tenders in both public and private sectors requesting evidence of targets and evidence of actions when it comes to sustainability.

Remember, this isn’t about what you pledge, it’s about proving you are doing what you said you would: “WALKING THE TALK”.

Why do I have to prove it?

Buyers of services or products are also feeling the squeeze and they need to validate that:

  • They are procuring products and services which are futureproofed.

  • They are buying from businesses who are fit for purpose

  • Sellers are aligned to their own targets for Scope 3 validation.

Should organisations ‘underpromise and overdeliver’?

It sounds strange to even suggest you should ‘undercook’ what you’ve achieved when it comes to sustainability, but the point is, organisations need to be certain about what they’ve achieved, and back this up with strong data and evidence. How to make it happen:

  • Make sure you know your data: You need to know where you have started and what you’ve achieved. Without this you will not be able to prove yourself.

  • Create a clear reporting structure: Accurate, timely management information, will means you can react to under and overperformance rapidly and limit waste. Clear MI is the building block to success

  • Be clear on what you are aiming to achieve: Make sure you validate everything you are stating you have achieved and let your clients now it. However, remember no ‘green washing’.

  • Accreditations: Think this through, pick the right one and not just because it is easy. It should push your business to the next level.

If you would like to talk to the team about the steps required to became ‘sustainability ready’, please get in contact with us