With new legislation on the horizon, it’s highly likely public sector bodies will be required to source from suppliers who pass certain sustainability criteria.
Given the global disruption of the past two years, procurement professionals might be tempted to allow sustainability targets to drift down their list of priorities.
This, however, would be a mistake. Not only is sustainability an issue that resonates with customers and stakeholders, it is increasingly mandated by contract awarding organisations.
Nowhere is this more evident than in the £300bn public procurement sector, which accounts for around a third of all public expenditure every year in the UK.
The Procurement Bill
The UK government’s Procurement Bill aims to replace the current bureaucratic and process-driven regime with a simpler, more flexible and commercial system.
According to the government, the Bill will deliver better value for money and encourage innovation by slashing red tape.
For tendering organisations, it promises to open up public procurement to new entrants such as small businesses and social enterprises.
It’s time for action
The incoming legislation means the time is right to update procurement processes ahead of the changes to avoid disruption. Procurement teams should consider proactively updating their sourcing software to take into account the changing requirements of stakeholders.
Atamis business development manager, Richard Leslie, said: “Things are changing so quickly, just in the last few years we’ve seen Brexit, Coronavirus and now war in Ukraine, each with their own specific challenges when it comes to procurement. Now, more than ever, teams need agility and flexibility in their software, they need a system designed with the future in mind.”
The change in emphasis for procurement from the most economically advantageous tender (MEAT) to the most advantageous tender (MAT) is indicative of a shift towards taking a wider approach to what should be considered when assessing tenders. This change should encourage sustainability criteria to jump up the priority list for those considering incoming bids.
Sustainability as value, not cost
Tracking these issues and monitoring supplier relationships is increasingly crucial for procurement teams, with stakeholders looking for more in-depth information that goes beyond Tier 1 and ensures positive changes are embedded across the contract life.
Through the introduction of robust and future-focused procurement processes, organisations can start to see issues such as sustainability as sources of value rather than unwanted, additional costs.
After all, eliminating unethical behaviours can improve compliance within the supply chain, making organisations less likely to be exposed to legal challenges.
This mindset also sends a powerful message about a company’s ethical stance to its wider stakeholder base including investors, customers and employees.
Ethical procurement is a journey rather than a destination. Its requirements are constantly changing based on many factors, and an organisation’s processes and procedures must be agile and innovative in order to face the challenges the future will bring.
To find out more about how Atamis can help streamline your procurement process go to atamis.co.uk.