Procurement Weightings.

Rennae,

The non goverment organisation ICLEI's European Office manages a procurement campaign for local governments called Procura+ and a network of purchasers called BIG-Net ("Buy it Green"- Network). A number of the Councils involved in this campaign/network have developed environmental criteria for a number of products and services. The following Web site may help: http://www.iclei.org/index.php?id=796

Regards,
Geraldine

Graldine Plas
Yarra Region EPA Victoria
40 City Road, Southbank GPO Box 4395QQ
Melbourne Vic 3001
Phone: 03 9695 2724
Fax: 03 9695 2691
Email: [email protected]

You might want to look at the SPPC - sustainable products purchasers coalition. http://www.sppcoalition.org/ From their mission statement - The Sustainable Products Purchasers Coalition acts as a catalyst for the transformation of industry and the marketplace to develop, produce, and consume sustainable products - utilizing the Coalition's aggregate purchasing power to accelerate industry's adoption of the use of LCA tools to address the current need for clear and concise product environmental performance data.

Kif Scheuer

Doctoral Candidate
School of Natural Resources and Environment
University of Michigan
[email protected]

In response to the above subject folks, Try HYPERLINK "http://www.ecospcifier.org/"www.ecospecifier.org as a example of how one group is providing this sort of data and weighting here in Aust. David Baggs and others has developed this and though it does not necessarily spell out the formula used, it has potential for broader use I feel.

Paul Payten
GEENI www.geeni.net

Hello, Rennae!

Our paper expert says that she is unaware of any life-cycle assessments that factor in transportation, but she pointed me to this Paper Calculator to judge the environmental impacts of various proportions of recycled content. You would have to manually figure in the transportation costs and refigure the units into Australian units of measure. She is very interested to see if someone else comes up with something better. The Paper Calculator was designed by the US Office of the Federal Environmental Executive and is available here: http://www.ofee.gov/gp/papercal.html

Diana Ruth

Olegre Washington State
Department of Ecology Hazardous Waste and Toxics Reduction Program Environmental Education/ Outreach Specialist

Hello,

Peterborough Green-Up (Peterborough, Ontario, Canada) has an initiative from it's Waste Reduction department that discusses this issue from a consumer point of view (and is planning to develope the business procurement side). It is a website called the Green Shopping Guide. The criteria for products and services being listed on the site is clearly posted, and will continue to be refined. We are very pleased that this discussion is happening! The url is www.peterboroughreuses.com/shopping

Cate Henderson

Water Program Coordinator c/o Peterborough Green Up
360 George Street North, Unit 42
Peterborough, Ontario K9H 7E7
Tel: (705)745-3238
Toll Free: 1-888-745-3238
Fax: (705) 745-4413
[email protected]

I believe Rumi Shammin [[email protected]] is engaged in a project to look at the net energy status of various products.

cheers
Jack Santa Barbara

The Sustainable Scale Project
www.sustainablescale.org

Dear Rennae:

A classic error in the development of green procurement policies and activities is the lack of understanding of the purchasing process and the mechanisms procurement experts use to effect change - one of the groups you should speak to is your local purchasing association - if they have not done anything then track down other procurement associations in other countries and see who is doing what. As a backgrounder, I have provided an amended excerpt of an article that appeared in the Asian Productivity Organization Journal. (the figures/graphs were removed for this forum)

Cheers
Lynn Johannson B.E.S., (Hons) M.Sc., FRSA

LCA - THE PROFIT IN REDESIGNING FOR SUSTAINABILITY:
70% of the cost of a product's development, manufacture and use are determined in the initial design of the product. This makes design a crucial determinant of the product's competitiveness. Environmental risk or value is also in the design; therefore it is critical to the success of greening productivity to eliminate negative environmental impacts in the design phase. If design is under the control of the same organization as production, then the first barrier, communication tunnels or information stovepipes, can be minimized. This allows the business responsible for implementing the greening process to make design changes with substantial savings in cost, reductions in environmental impact, and tremendous improvements in efficiency. Those that have started down the path of innovating should not rest on their initial success. Just as Nature rejuvenates herself yearly, organizations must also have springtime. Keeping a company healthy and profitable over time means working continually to improve every relevant element of its business system. Too often in the glimmer of past successes, or a steady, stable market, companies tend to become complacent. The glow of one success can be quickly overshadowed by a competitor's innovation, and the market's attention is diverted elsewhere. This is a simple reminder that "once-and-for-all solutions" do not work in a dynamic and changing world. While there is benefit to learn more about the details of what LCA has to offer, for the purposes of this discussion it is enough to understand that inputs pre-determine the quality and quantity of outputs. This is often simply stated as "garbage in, garbage out."

THE ROLE OF PURCHASING AS AN INCENTIVE FOR GP
Purchasing has a critical role to play in promoting the adoption of green productivity. Purchasing is already going through its own metamorphosis, moving from a line function to a strategic process supported by continual improvement (Johannson, 1994, 1995, 1996). Purchasers, awakening to the realization that buying green is a crucial component in their risk management process, need assurance and evidence that a supplier is managing environmental resources as carefully as cash flow. For that reason, purchasers need to incorporate the environment as one of their core screening criteria, which includes: Supply and delivery Costs (not just the purchase price!!!) Technology Health and Safety Quality and of course the Environment These criteria are all part of a risk assessment. A quick review of the history of purchasing, since 1950, is useful to understand where the profession has been and where purchasing as a process is headed. This discussion will help in the understanding of the value of purchasing in promoting GP. In the 1950's, the purchaser's role was to execute requisitions in a market that was hungry to buy in a world of isolated economies, focused on rebuilding business after wartime. Decisions within an organization were made in other departments; purchasing was a clerical job in a department. In the 1960's competition for purchasing dollars began and marketing to win a customer's favor grew (so did golf). In the 1970's the oil crisis caused disruptions that made purchasers concerned about the continuity of supply from vendors. Price, not cost, remained the focus of the purchasing function. In the 1980's purchasers had to deal with double-digit inflation. Vendors were squeezed each time there was a transaction in a "price fight" where little else seemed to matter. However, coming through the 1980's and into the 1990's there was the realization that quality was the ticket to a growing international marketplace, and a venue for managing suppliers to achieve a value-added product. While isolated concerns for environmental goods and services started in the mid 1980's with the Blue Angel process, followed by the Canadian Ecologo program, interest in green purchasing did not really start until the early 1990's.

GREEN PROCUREMENT CAME IN THROUGH THE BACK DOOR
Attempts by business and governments to incorporate environmental considerations into activities within an organization's business processes, be it a for-profit or not-for-profit entity, did not start with procurement. They typically started with concerns related to waste and emissions, the focus in the early days being on end-of-pipe practices. Like the salmon swimming upstream, many opted to move against the flow, struggling against the current as they were caught working on issues that were in the public eye. Litter, for example, was an eye catcher in Canada, particularly around the issue of soft drink containers. However, what evolved out of this concern was the blue box program for multi-material recycling, which really has nothing to do with litter and everything to do with better use of resources and diversion of material from landfill. However, waste diversion became the backdrop to the initial focus of green purchasing in governments and industry, which specifically targeted packaging, but this has a limited return despite all the valiant efforts and energies applied. Typically a purchaser, usually a junior person, was called upon by an engineer from production assigned with the task of waste diversion, to find someone who would take the packaging, treated as a waste, "away". A parallel expectation was occurring in households; the public had the expectation that someone else was responsible for taking a package "away". Purchasing was a task involving the acquisition of goods and services, and the purchaser was and in many cases still is, charged with finding the lowest price, not lowest cost. However, as we now know from LCA, 70% of the real opportunity for cost savings, and the related environmental benefits come in design. Therefore, at most the purchaser could only potentially recoup 30%. Experience has shown that this is unlikely to occur except in rare situations as the package material, treated as a waste, conceptually and in practice has minimal, no or negative value. Purchasing approaches for greening when initiated to deal with end-of-pipe challenges, do not make a formula for success; often it leads to a clamoring from those involved in waste management for subsidization. Many green procurement attempts never gained momentum or returned full value as isolated policies and the environmental departments developed programs without soliciting the expertise and support of the purchasing department. These programs focused on promotional activities but outcomes showed little or no result. It was hard to determine any real value gained, as often there was no measurement of the improvement, be it qualitative or quantitative. Green purchasing today is still under development and faces a number of barriers. Organizations that fix on price as the key determinant of the purchasing decision and focus their efforts for environmental improvements to end-of-pipe options, effectively limit their opportunity for real improvement. The tendency in these organizations is to apply narrowly defined environmental criteria to a selection of products or services, and label it as green purchasing. This is an unsophisticated approach, as it restricts the opportunity to leverage purchasing as a mechanism for attaining sustainability.

REPOSITIONING PURCHASING AS A STRATEGY FOR SUCCESS
Why is a strategic approach important to guide green purchasing forward? Consider: .. 55% of all revenue goes to suppliers for goods and services; .. range is 30% for services, as high as 90% for assembly; .. typically 41% of spending goes through purchasing BUT .. 59% are decisions made without the benefit of the purchaser; .. 70% of the cost, both financial and environmental, is in design. Sourcing in a sustainable is essential to supporting real progress in greening productivity. To enable this discussion to move forward a baseline definition is required. 'Greening' typically describes a trend in the global marketplace to incorporate environmental considerations as criteria in core decision making in all personal and business decisions, concerning activities, processes, and products. The term greening has wide application and has been used to refer to such diverse activities as trade, i.e. "Greening the GATT" to greening specific consumer products. It is a term that many publics are comfortable with; it suggests desirable objectives such as clean air, pure water, productive forests, fertile lands, and happy, healthy children. Some specific audiences see the term as being abused and overused by those who have made unsubstantiated marketing claims. The term 'green', as with the term 'greening', is used as an adjective with a broad reference to a product, service, and/or a process having one or more environmental attributes. It is this definition that will be used to refer to the 'greening' of the supply chain in this paper, although it does not infer a strict definition of conditions or performance levels. In accepting end-of-pipe designations as 'green', many of the costs, both environmental and financial, are still willingly acquired by the purchaser, but without understanding the consequences. There may even be additional liability transferred to the purchaser. Green procurement is still in its early days; there are no hard and fast rules for success. Often green procurement efforts to date have been initiated without the benefit of a strategy, and without the involvement of purchasing expertise. As a result of communication tunnels, the first barrier, it means that a green stream exists and a purchasing stream exists, without flowing together. The consequence of this divergence is that green policies for purchasing and their accompanying guidelines remain words on a page. No real value is added. Therefore to experience bricks and mortar level success, a better understanding of the commonalties between greening and purchasing process must be explored.

QUALITY MANAGEMENT ENABLES CONNECTIVITY BETWEEN GREEN PURCHASING AND PRODUCTIVITY
Quality management refers to the process of management recognizing that the only constant in this world is change, and making managing change as a core competency. While some people are adverse to change, it occurs daily, i.e. weather, wellness, and the flow of water. Change is a natural phenomenon. Quality management in this discussion is not synonymous with the adoption of ISO 9000, as many have adopted the international standard without ever embracing quality as a philosophy. In its simplest form, quality management is also referred to as 'Plan, Do, Check, Act' or the PDCA Cycle, which is taken from Deming's work. While W. Edwards Deming is credited as being the grandfather of quality management, it was Japanese willingness to embrace the idea and their subsequent hard work that proved the commercial and trade value of quality. There must have been the seeds of understanding even then of the application of quality to environment. Consider the nature reference in Professor Kaoru Ishikawa's fishbone diagram for determination of cause and effect, structure trees for problem analysis, flow diagrams, and stream-to-stream analysis. The existence of quality management can facilitate the adoption of environmental management standards and performance improvement because of similar terminology, concepts, tools and philosophies."