1. Environmental and Social Considerations in Public Procurement
By Mr. Karsten Andrup Pedersen
Logistic Manager
Municipality of Kolding, Denmark
Valletta, January 2006

2. Environmental and Social Considerations
Agenda:
Purchasing Policy
Environmental considerations
Social considerations
The procedure of Green purchases
Identifying green suppliers by questionnaires
Experiences
Example of purchase including social and environmental considerations:
Operation of a residential home

3. Environmental Performance
Elements in purchasing
Goods
Construction
of housing areas
Buildings
Services
Prequalification
Technical
specification
Award
criteria
No environment
Environmental
Demands:
Compounds
Use phase
Disposal phase
Packaging
Questionnaire on
Environmental Performance
Points-score system
Development
Award criteria becomes a demand
Documented experiences
on environmental management
Focus on
compounds
and energy
Environ-
mental
Management
Social clauses
A target
area
Points given
Demands :
Resources
Consumption
Impact on Nature
Target award criteria
becomes a demand

4. Purchasing Policy
The purpose of Kolding Municipality’s purchasing policy is to ensure that all purchasing is undertaken in conformity with the council's expectations. In particular, it is designed to achieve:
the right prices
environmental friendly purchases
quantity discounts
reliability of supply
simplified settlement procedures and minimal administration
limited storage costs
avoidance of faulty purchasing
trust and strong cooperation between Kolding Municipality and its chosen suppliers.

5. Purchasing Policy - Environment
The policy was confirmed by the Town Council in 1998
The policy calls for an ecological resetting of all purchasing actions
Environmental criteria must be assessed on par with other criteria
Implementing the green purchasing policy have been done by integrating environmental questionnaires by turn into all calls for tenders
Within the year 2005 Kolding have greened approximately 85% of all framework agreements

6. Purchasing Policy- Social aspects
Social aspects must be considered when purchasing services
Social aspects must not be used as award criteria
The call for tender must request that the supplier is committed to:
Employ long term job seekers
Set up special positions for people with reduced working ability
Set up positions for trainees
Ensure equality between men and women
Ensure ethnical equality
The amount of personnel covered by the social clauses must be defined specific for every call for tender

7. The process of green purchasing of goods
Users draw up demands on:
- Functionality
- Quality
- Delivery Terms
Evaluation process:
- Users evaluate suppliers on price, functionality, quality, delivery terms etc.
- Environmental department evaluate suppliers on environmental performance
Evaluation is done by a point score system
The supplier with the highest point score is selected
Users draw up demands on:
- Functionality
- Quality
- Delivery Terms
An environmental questionnaire is designed by the environmental department
The suppliers to bid are identified and the call for tender is published
An environmental questionnaire is designed by the environmental department
The suppliers to bid are identified and the call for tender is published

8. User Groups defined on the basis of Product groups
The Organisation of Green Purchase
Purchasing office
Development Team
User Groups defined on the basis of Product groups 1 2 3 4 5 6 7 8 9 10 11
Purchasing officers
Environmental office

9. The procedure of Green Purchasing
Identifying green suppliers:
The suppliers must answer an environmental questionnaire
The questionnaires contains different kinds of questions
regarding impacts from the product
regarding impacts from the packaging
The questions are formed in a way, that positive answers indicates a positive environmental performance

10. The procedure of Green Purchasing
Identifying green suppliers:
For every product group there are minimum requirements, that must be met
The questions provide the basis to compare the environmental standards of the offered products
Assessment is facilitated by a point score sys-tem
In the end environment is assessed on par with price, quality and level of service

11. The procedure of Green Purchasing
Assessing the suppliers environmental performance:
The questions in the environmental questionnaire can be answered by yes or no
An yes-answer indicates an environmental positive performance
The numbers of yes’ is counted and calculated into points
If yes to every question the supplier gets maximum point
Point are reduced relatively to the numbers of yes’ by using the following function:
Point = (number of Yes/number of Questions)*Max points

12. The procedure of Green Purchasing
Experiences:
Green purchasing has been implemented without supply of extra economical funds
Modifications of the procurement procedures and creation of an easily applicable assessment have helped to avoid an increase in costs
Higher prices have only been found in the product group of organic food

13. The procedure of Green Purchasing
Experiences:
Kolding has experienced very positive reactions to the environmental questionnaires
The suppliers are very open and fulfil the questionnaires with great skill
Kolding cannot support the argument, that an insufficient range of green products is available on the market

14. Example - Environmental and Social consideration:
Management of an Residential Home:
To ensure that the management is done as sustainable as possible, the call for tender includes:
Social clauses
Environmental Requests
An Environmental Questionnaire
Weighting of Criteria:
Tender sum 50%
Service 25%
Organising resources 15%
Quality 5%
Environment %

15. Evaluation Chart Criteria of allocation Weight Primary criteria
Partial criteria
Primary
Partial weight
Tender sum
1. Basic offer – Module A 50
2. Additional offers 30
a) Module B
b) Module C
c) Module D
d) Module E
3. Activity 10
a) Module F
b) Module G1
c) Module G2
d) Module H1
e) Module H2
4. Other offers 5
5. Running the centre

16. Evaluation Chart Criteria of allocation Weight Primary criteria
Partial criteria
Primary
Partial weight
Tender sum
1. Basic offer – Module A 50
2. Additional offers 30
a) Module B
b) Module C
c) Module D
d) Module E
3. Activity 10
a) Module F
b) Module G1
c) Module G2
d) Module H1
e) Module H2
4. Other offers 5
5. Running the centre

17. Management of an Residential Home
Social clauses:
At least 5% of those positions necessary for fulfilling this contract must be occupied by employees from distinct groups such as:
Long term unemployed
People with reduced working ability
The supplier must have a written personnel policy for those positions necessary for fulfilling this contract which ensures:
Equality
Integration
Maintaining personnel

18. Management of an Residential Home
Social clauses:
At least 5% of those positions necessary for fulfilling this contract must be occupied by employees from distinct groups such as:
Long term unemployed
People with reduced working ability
The supplier must have a written personnel policy for those positions necessary for fulfilling this contract which ensures:
Equality
Integration
Maintaining personnel

19. Environmental questionnaire -examples
Waste management:
Are waste sorted in fractions for reuse?
Energy and water consumption:
Are the consumption monitored on a monthly basis?
Are light bulbs energy saving ones?
Purchasing Procedures:
Do purchases have environmental focus?
Office supply:
Are the least energy consuming items purchased?
Kitchen:
Is the management done with focus on energy- and water consumption, and organic food?
Cleaning and Laundry:
Does the used agents comply to Eco-label criteria?

20. Point Score - Environment
Supplier
Sum of Yes
Point Score A 17
3,3 B 16
3,1 C 21
4,0 D 20
3,9
Maximum 26 5

21. Awarding the contract 96,0 Criteria Supplier A Supplier B Supplier C
Supplier D
Economy (50%) 50 45 47 40
Service (25%) 23 22 25 21
Resources (15%) 12 10 15 14
Quality (5%) 5 4 3
Environment (5%)
3,3
3,1
3,9
Total
93,3
84,1
96,0
81,9