As part of a sustainable procurement approach, socially responsible public procurement (SRPP) aims to take account of social impacts throughout global production chains for goods, works and services and to prevent negative consequences such as child labour and inhumane working conditions (Tepper et al., 2020). SRPP is thus a powerful policy instrument for helping to implement the 2030 Agenda. The EU Public Procurement Directive enables all public bodies in the European Union (EU) to take sustainability criteria into account:

Art. 67 (2) of Directive 2014/24/EU states: “The most economically advantageous tender from the point of view of the contracting authority shall be identified on the basis of the price or cost […] and may include the best price-quality ratio, which shall be assessed on the basis of criteria, including qualitative, environmental and/or social aspects, linked to the subject-matter of the public contract in question.” (our emphasis)

The amounts that EU member states spend on public procurement are huge, making up some 14 per cent of added value within the Union. In Germany, municipalities account for the lion’s share of this spending. If sustainability criteria are integrated into tenders for goods, other works and services, they can make a major contribution towards achieving the goals of the 2030 Agenda for Sustainable Development, particularly ensuring sustainable consumption and production patterns (Goal 12).

Although public procurement makes up some 14 per cent of added value in the EU, invitations to tender rarely include social criteria. #sustainableprocurement --> Klick um zu Tweeten

Environmental criteria are increasingly becoming a factor in public tenders in Germany and other European countries. This is much more rarely the case for social criteria. By contrast, countries in the Global South, especially in sub-Saharan Africa, are already making targeted use of public procurement to improve the social situation of disadvantaged groups in their societies. Requiring the inclusion of social criteria can improve working conditions, particularly in global supply chains.

Amongst other things, at the German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE) we are investigating how social criteria are being integrated successfully into public procurement at municipalities in Germany and Europe.

We are asking ourselves: what are key success factors and triggers for delivering SRPP at pioneering municipalities in Germany and Europe?

We are following the theory of change management in order to answer this question. We are proposing a matrix for categorising and scoring municipalities’ measures for incorporating social criteria into their procurement. This matrix can then be used to group success factors and their triggers in three dimensions:

• – the legal;
• – the institutional; and
• – the individual dimension.

These dimensions thus encompass the legal framework, which in content terms stipulates the principles by which municipalities should act, as well as the institutional structure for implementing these principles and the individuals who help to shape and fill out this framework for action. We also introduce two temporal dimensions – the introductory and the consolidation phase – to map how potential measures and success factors change over time.

We invite decision-makers and procurement officers at municipalities to use this matrix as a template to:

1. record their existing measures in a structured way; and
2. adopt a targeted approach to developing new strategies for delivering socially responsible procurement.

This template allows public authorities to determine for themselves how they could make their procurement activities more sustainable: the success factors (bold) listed in each box describe the overarching objective that the measures should help to achieve in each case. Download the template

We have identified key success factors and their triggers based on pioneering German municipalities and their experience of socially responsible procurement. The figure below summarises our findings using the matrix described – three content and two temporal dimensions.

Findings for the legal dimension:
in the legal dimension, two measures in particular are capable of supporting the successful integration of social criteria into municipalities’ procurement.

1. Laws and regulations governing socially responsible procurement should be clearly worded and ambitious. They need to offer guidance for practical implementation by municipalities.
2. At municipal level, laws and regulations – including Council decisions – should be clearly “translated” for day-to-day procurement activities and integrated into standard work tools (e.g. forms, work instructions and electronic procurement catalogues).

Findings for the institutional dimension:
three measures can help to make municipal procurement more socially responsible:

1. Recognising the role procurement plays as a strategic lever for a municipality’s interests and objectives;
2. Making more intensive use of strategic procurement instruments (e.g. dialogues with bidders or electronic procurement catalogues); and
3. Identifying and tackling shortcomings in work and communication structures. The largely decentralised procurement that goes on at German municipalities makes it much harder for procurement to be coordinated and tracked strategically. By contrast, creating job roles with specific responsibility for socially responsible and/or sustainable procurement can be a help.

Findings for the individual dimension:
personal commitment currently appears to be the most important success factor when it comes to integrating social criteria into procurement activities, and the personal conviction of dedicated individuals is its most significant trigger. As this success factor is difficult to influence from outside, the focus should be on the following triggers of personal commitment:

1. Dialogue, both internally between relevant specialist offices and the officers responsible and externally with NGOs and public advisory institutions, for example;
2. Information on the reasons behind socially responsible procurement and the integration of other strategic objectives (e.g. promoting innovations or environmental goals); and
3. Training in integrating socially responsible criteria into a municipal procurement management setup with a professional and strategic focus.

Success factors are highlighted in bold, with their triggers listed underneath

None of the pioneering German municipalities studied showed evidence of all the success factors and triggers. The table thus does not in any way indicate minimum requirements for successfully introducing social criteria into procurement activities. Rather, it lists various entry points from which decision-makers and practitioners at municipalities can pick suitable pathways.

There is no one right way for municipalities to introduce socially responsible procurement. They can choose the path that suits them from a wide range of options. #sustainableprocurement --> Klick um zu Tweeten

An analysis of six examples of municipalities from Sweden, the Netherlands and the UK shows that European municipalities face similar challenges, such as decentralised procurement structures and a lack of internal capacity and resources. However, it also reveals that there are many pathways to success.

To overcome difficulties in socially responsible public procurement in Germany, we should also take a look at European municipalities following alternative paths. #sustainableprocurement --> Klick um zu Tweeten

The list below summarises these alternative approaches to delivering socially responsible procurement. No distinction is made between the introductory and the consolidation phase as the data does not permit a clear separation to be made. Success factors conducive to environmentally friendly procurement are also listed insofar as they are relevant to the successful integration of social criteria, since “green” procurement is more widespread in Europe than socially responsible procurement (Stoffel et al. 2020).

What measures could also open up new entry points for Germany in terms of introducing socially responsible procurement? An overview:

Alternative measures in the legal dimension:

1. National and/or regional plans of action can define clear strategies and objectives for their implementation.
   Example: the “Action Plan for Responsible and Sustainable Procurement by Governments” in the Netherlands shows that plans of action can relieve the pressure on public authorities to develop their own rules.
2. Clearly defined sustainability strategies combined with precise targets are an effective way to increase the uptake of socially responsible procurement amongst procurement officers
   Example: the city of Malmö is buying only organic food for its public canteens in 2020.
3. Taking account of local challenges
   Examples: cities such as Rotterdam and Manchester and the county of Cornwall take local challenges and (small-scale) suppliers into consideration when defining social criteria. This approach gets all local stakeholders more engaged with the cause of socially responsible procurement and builds mutual trust.
4. Analysing the procurement and contract documents of the most important suppliers to municipalities
   Example: the city of Manchester joined forces with a consulting firm to evaluate the contracts of its top 300 suppliers and thus improved its criteria for tenders.

Alternative measures in the institutional dimension:

All the European examples confirm two key success factors from the German case studies: having additional staff to deliver socially responsible procurement and expanding the dialogue with market actors, particularly (potential) suppliers. A dialogue of this kind enables municipalities to gauge the capacity and willingness of their suppliers to comply with the sustainability criteria being proposed. In turn, the suppliers are kept abreast of any upcoming sustainability requirements and can make their own contributions to the process.

We also identified four additional success factors.

1. Central, well-resourced consultancies make the local delivery of socially responsible procurement considerably easier in all matters of (strategic) procurement at regional or national level
   Examples: SKL Kommentus in Sweden and the Dutch Public Procurement Expertise Centre, PIANOo.
2. Harmonised e-procurement tools that expressly support sustainability objectives significantly increase the widespread use of social criteria in invitations to tender
   Example: The Hague.
3. Dialogue and clearly defined responsibilities in decentralised procurement structures
   Examples: while Rotterdam introduced sustainability officers to help procurement staff apply sustainability criteria, the city of The Hague set up working groups made up of employees from various departments and across its hierarchy. We have also encountered this approach outside Europe, e.g. in the city of Tshwane in South Africa. Instead of recruiting additional staff, one person in each department was made responsible for incorporating sustainability criteria into procurement processes.
4. Regular, (semi-)formalised dialogue with national and international colleagues
   Examples: in the Netherlands, the four largest cities – Amsterdam, Rotterdam, The Hague and Utrecht – meet four times a year to discuss sustainable procurement and devise collective solutions and market statements on changes in public demand. Rotterdam and other municipalities also benefit from international dialogue and their membership of international networks such as Procura+ and the Global Lead City Network (GLCN).

Alternative measures in the individual dimension:

Three success factors were also found to play a decisive role in determining the motivation and willingness of local actors to deliver socially responsible procurement: providing information on the reasons for taking social criteria into account, expanding capacity to apply these criteria, and engaging in dialogue with relevant stakeholders. Two factors were able to increase the motivation levels of procurement officers further:

1. A cultural shift within the municipality towards “even more local, even more social”
   If local challenges are incorporated into procurement activities as well, the people involved identify much more strongly with relevant criteria. It is important, however, for the local perspective to enhance rather than replace the municipalities’ duty of due diligence in respect of problems in global value chains.
2. Minimising the risks that procurement officers take on when considering social criteria
   Procurement officers frequently feel that stipulating sustainability criteria in tender procedures harbours risks, e.g. legal imponderables or a lack of support from managers and colleagues, which often puts them off defining relevant criteria. As a general principle, the more clearly and coherently the procedure is set out in the legal and institutional dimension, the less concerned staff on the front line will be about making mistakes or getting into grey areas that might contravene EU competition law. Politicians and managers are called on to establish a stable and clear basis for action in this regard.

Our research shows that many different approaches can boost the delivery of socially responsible procurement. Nevertheless, eleven overarching recommendations for action can be identified that, if implemented, can make public procurement at municipalities more socially responsible:

Political decision-makers should…

• 1. …write laws and regulations on socially responsible procurement to be clear, ambitious and coherent between the various political levels.
• 2. …set up central advisory institutions backed by strong finances for all matters of (strategic) procurement at regional or national level.

Decision-makers at municipalities should…

• 3. …(also) consider local challenges when developing a sustainable procurement framework for their municipality.
• 4. …comply with socially responsible procurement principles by clearly “translating” laws and regulations for front-line staff.
• 5. …support broad-based motivation for the issue through internal and external dialogue, cooperation between departments and further training.
• 6. …improve the expertise of central procurement bodies and ensure functioning communication and work structures between actors involved in procurement.
• 7. …provide human resources for socially responsible procurement and agree clearly defined responsibilities.
• 8. …use e-procurement tools for all stages in the procurement process in which sustainability objectives and criteria are taken into account.

Staff in charge of socially responsible procurement in administration and civil society should…

• 9. …provide decision-makers and procurement officers at municipalities with accurate information on the importance and implementation of socially responsible procurement.

Staff in charge of socially responsible procurement in administration and procurement officers should…

• 10. …gain a holistic understanding of procurement structures at municipalities, e.g. by analysing their current situation.
• 11. …make use of external input, e.g. through dialogue with official support institutions, civil society, consulting firms or pioneering municipalities.

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