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Sustainable procurement and social value in procurement are similar. However, they differ in their focus. Social value tends to have a narrower focus on local communities than sustainability, which includes processes up and down the entire procurement supply chain.
Let’s look at the social value in public sector procurement.
Social value isn’t new to public procurement processes. But, while it was a factor in selecting suitable suppliers, it wasn’t mandated. The Procurement Act 2023 changed that and now social value is a legal requirement and a key determining factor in tender evaluation and awards.
The particular focus is on MAT – the overall value of a contract, not just the contract price. The emphasis is on quality rather than quantity when it comes to projects or initiatives that benefit the community and can include social and environmental initiatives.
Let’s look at what sustainability is in the grand scheme of things.
Sustainable procurement refers to the integration of social, economic, and environmental factors with the price and quality of goods and services throughout the supply chain. It’s a holistic practice that has a long-term positive impact on the safety and integrity of the relationships between people, the environment, and the preservation of natural resources. It can include using low-carbon materials and favours renewable energy sources.
Technically, social value falls within sustainability’s ambit. It helps sustainability meet its obligations to society and environmental protection-related regulations and legislature. Sometimes this happens simultaneously, for example, a community upliftment project that involves reviving, revamping, and rebuilding a local park benefits the community and the environment.
Working with sustainable supply chains can unlock financial, operational, and reputational benefits, minimise negative impacts on the environment, reduce the risk of non-compliance with environmental legislation, and increase employee and customer loyalty.
The Procurement Act 2023 includes mandatory social value with a weighting of at least ten per cent. So, immediately it’s important (non-negotiable) from a legal perspective.
Sustainable procurement is also a requirement because local and central government contracts must contribute to the national government’s commitment to achieve a net-zero rate of carbon emissions: essentially, no carbon footprint.
This means that preference is given to suppliers who provide the most relevant social and sustainable value because they can crank up contracting authorities’ ability to meet those goals.
Perhaps most important is the tangible difference social value and sustainability projects make to local communities. For example, employment-based projects have knock-on effects on local economic factors and reduce unemployment, which can lessen the rate of homelessness in the area.
The benefits of sustainable procurement include reducing risk, decreasing costs, promoting revenue growth, and complying with legislation.
The positive environmental impact can be significant and indirectly increase employee and customer loyalty.
Before the new social value policy, contracts were determined on a MEAT basis.
MEAT: Most Economically Advantageous Tender. Price was the primary factor in awarding government contracts. The lowest price that included additional cost-saving benefits throughout the procurement process generally won the tender.
MAT: Most Advantageous Tender. Price is not the primary consideration in awarding public sector contracts. The following economic, environmental, and social factors are also important considerations in sustainable procurement:
Availability and accessibility of transport links
Improving the safety of local communities
Encouraging growth for local SMEs
Improving air and water quality, cleaning up the streets, and reducing waste.
Removing hazardous objects and repairing or replacing essential items to improve health and well-being
This is where social value best practices are advantageous because they provide better value for money. The bid might be more expensive than other contracts, but the overall value, especially social value, exceeds your competitors’ ability to deliver additional advantages and benefits.
In general, examples of social value and sustainable procurement include:
Renewable energy: Using renewable energy sources like solar panels can have a significant impact on your energy costs. Costs saved can be reinvested in your company and your social value project.
Refurbished equipment: Purchasing refurbished equipment, especially computer hardware, can offset fossil fuels used in other processes of your procurement cycle.
Correct disposal of equipment: Correctly disposing of equipment, especially computer hardware, benefits the health and well-being of the community at large. Computers that are just thrown away with the rest of the rubbish release toxic chemicals, including lead and mercury, into the environment. Not exactly preserving the planet for future generations.
Switch to fuel-efficient vehicles: Replacing your existing company cars with fuel-saving vehicles can save you a lot of money because you don’t have to fill up with fuel often. Electric or hybrid cars have a much smaller impact on the environment and help you reach sustainability goals along your net-zero journey.
Equal opportunity employment: Providing employment opportunities to disadvantaged groups, including those with learning difficulties, ex-offenders, and domestic violence survivors helps grow the local economy and contributes to a culture of non-discrimination in the workplace.
It starts with the community. What do the people prioritise?
Unemployment is a common theme, so it’s usually a good place to start.
Supporting local businesses is a great way to establish your credibility in the community. Source your materials, products, and services from local companies wherever and whenever you can. You can look further than your supply chain and explore other social considerations, like using local caterers for events.
Another great idea is to get accredited as a real Living Wage Employer. Living wage, hour, and pension accreditation is available from the Living Wage Foundation. Obviously, you must then ensure all your employees, including those working on your supply chains, are paid the minimum real Living Wage calculated by the foundation.
Creating, developing, refining, and implementing social value and sustainability projects is time- and energy-consuming enough. You don’t really want to add marketing on your to-do list, do you?
The thing is, without marketing and without exposure no one is going to know that you even exist, let alone how groundbreaking your initiative is. You need to get your brand out there, you need to attract attention – the right kind of attention for the right reasons. A growing brand reputation is the only way your projects will be able to give you a competitive advantage.
As you can see, marketing in the public sector is a specialised skill that requires a professional hand. Cadence Marketing provides exactly the services you need to stand out in the crowded market. These include market research, webinars, and email marketing.
Even something that seems as simple as sending an email needs to be approached correctly. It requires research, a precise subject line, nuanced content for your specific target market, and an email list that has been carefully put together to ensure maximum ROI.
Email marketing is only the tip of the iceberg in B2G marketing. You also need to consider content marketing, lead generation, and events, like social value conferences.
Contact us for more information on B2G marketing strategies, social value, sustainability, and why research is the foundation for your entire marketing plan.
Pacific House, Digital Park, Manchester, Salford M50 1DR
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