Delivered by Arup at the Global Forum 2020 Sustainable Procurement Index for Health Clinic session. Presenters: Dr. Kristian Steele, Associate, Arup Ms. Anna Tuddenham, Consultant, Arup Mr. Terry Ellis, Senior Consultant, Arup Mr. Callum Newman, Associate Director and Group Leader for International Development, Arup

1. GLOBAL FORUM2020
3 R D S A V I N G L I V E S S U S T A I N A B L Y:
SUSTAINABLE PRODUCTION IN THE HEALTH
SECTOR GLOBAL FORUM|2020 RIYADH
Sustainable Procurement
Index for Health Clinic
Moderator: Kristian Steele
Speakers: Terry Ellis, Anna
Tuddenham, Callum
Newman

2. Agenda
• What is the SPIH project?
• Stakeholder engagement
• Vision of the index
• User journeys
• Piloting
• Q&A
GLOBAL FORUM 2020
Moderator
Dr Kristian
Steele
Anna
Tuddenham
Terry Ellis
Speakers
Callum
Newman

3. What is the SPIH
project?

4. Project summary
“…to develop the Sustainable Procurement
Index for Health. This is as a globally
established, recognized and adaptable
measurement tool for policy makers,
manufacturers, suppliers, procurers, and
healthcare facilities end users. This tool will
provide an incentive for entities to improve their
environmental and social sustainability record.
No such measurement tool currently exists to
monitor (I) Greenhouse gas emissions, (II)
resource depletion (water, energy and
material consumption), (III) chemical/toxic
impact on human health and the environment,
and (IV) human, labour rights and gender
equality.”
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5. Project ambition
To accelerate sustainable procurement in the
health sector, by
• Supporting the decision making of buyers,
and providing certainty to suppliers
• Provide a robust and transparent method,
that clearly communicates expectations for
supply chain performance
• Being proportionate and relevant, respecting
the materiality and capability in the supply
chain
• Not just focus on risk, but provide clear
pathways for stakeholders to improve their
performance
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6. Project plan
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Definition
2020H1
Development
2020H2
Piloting
Early 2021
Testing
Spring 2021
We have completed the definition phase, which determines the structure of SPIH
and its key principles, and are now developing the detail and turning it in to a real
product. Soon we will begin piloting it with the supply chain.

7. Questions

8. Stakeholder
engagement

9. Key stakeholder
groups• Buyers
• Suppliers
• Non-government organisations
• Regulatory agencies
• Research bodies
• Other standards bodies
• Expert Panel
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10. How we engaged
• Survey issued to the Expert Group – good
response rate, with some follow up interviews
• Ongoing interviews with informants with
particular emphasis on suppliers
• Survey also launched to wider base of
suppliers
• Extensive literature review and best practice
analysis (including from other sectors)
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11. What we asked
1.Organisation or product
2.Same indicators for all products, or
flexible?
3.Modification of requirements
depending on healthcare setting
4.Should the buyer choose which
aspects of the Index are applicable
5.Should the Index give a single result
6.Buying event or supplier led
7.Barriers
8.Other networks / standards that they
already use
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12. GLOBAL FORUM 2020
Buyers - findings
Buyer ‘Wants’ Buyer ‘Barriers’
Organisations in the stakeholder group: Retail, Pharmacy, Hospitals, Healthcare providers
Stakeholder Role: Organisations that would request the Index is used and review the
information provided
• To have the information available to
make decisions that include the four
pillars of the index (chemicals, human
labour rights, resource depletion and
GHG emissions)
• To have mechanisms to choose
suppliers based on key indicators
• Flexibility in the index could help align
the index with procurers’ internal
sustainability priorities
• Integration of third party tools into the
index
• Buyers that trial the index through
procurement will have to absorb
greater cost and time implications than
those who adopt it later on
• Training will be required to apply the
Index result (i.e. the score) into the
procurer’s existing purchasing
framework

13. GLOBAL FORUM 2020
Suppliers - findings
Supplier ‘Wants’ Supplier ‘Barriers’
Organisations in the stakeholder group: Manufacturers, Distributors, Suppliers
Stakeholder Description: Organisations that would be required to provide information
into the Index
• To be able to position products in the
market and show they are satisfying
the standards required
• Understand what is expected of them
in the future
• Differentiate themselves in the
marketplace
• The ‘power’ will be put in the hands
of the buyers to implement criteria in
the index, led by purchasing
• Capacity and capability to respond
• Uncertainty in the future

14. Questions

15. Vision for the Index

16. Where in procurement?
• Based on the feedback and to achieve a viable first
product, the index will focus on a use case during a
specific procurement activity (a buying event), rather
than being a market monitoring tool or supplier/contract
performance tool
• Aim to support ‘shaping the market’ by leveraging
procurement events with long term potential to
transition to a market based/labelling scheme type
solution
• Buyer led solution will send a stronger signal for now; a
supplier led solution could appear voluntary
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17. Organisation or product?
• We received a range of views on this topic
advocating for one, other or both to be part of the
consideration
• Based on our research, there are some aspects
that do not fit a product-only approach well –
particularly labour standards and human rights
• We have adopted an approach that considers
both:
• Organisational emphasis for ‘baseline’
performance
• Product focus for leading performance
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18. Key theme areas
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GHGs
• Governance
• Measurement
• Target setting
• Supply chain
issues
Resources
• Governance
• Manufacturing
• Supply chain
issues
Toxicity
• Management
• Restricted
substances
• Disclosure
Social aspects
• Policy and
governance
• Audits
• Equality issues

19. Indicator sets
• We received comments supporting both flexibility
and fixed indicator sets
• We currently believe that some flexibility is
required for proportionality, but that it should not
be arbitrary. A filtering system could be used in
order to support rationalisation of the indicator set
to fit specific circumstances:
• intrinsic factors such as product category,
value of contract
• extrinsic factors such as geography (e.g.
using Global Slavery Index)
• We are currently finalising the indicator shortlist
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20. Levels concept explained
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• Each module has a pass threshold,
based on the criteria within the module
• All the modules within a level must be
passed to attain the overall SPIH level
• Some modules will be specific to certain
product types or in specific situations
• The criteria and scoring approach will be
transparent, so that the supply chain
understands expectations

21. Levels concept explained
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Level 1 passed
Level 2 not passed

22. Criteria development
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Theme Question Weighting Criteria / response Score
Scope
Do you measure your
Scope 1 & 2 GHG
footprint?
50%
No 0
Yes, following a recognised
methodology [from list]
20
Yes, following another
methodology
10
Reporting
Do you report your
GHG footprint?
50%
No 0
The results are published
internally
10
They are provided on request 10
Yes, they are published on our
website
30

23. Criteria development
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SPIH level Question Weight Criteria/response Score
Recycled
content of
product
Have you calculated the
recycled content of the
product?
17%
No 0
Yes, each product has <49%
post-consumer recycled
content
15
Yes, each product has >50%
post-consumer recycled
content
30
Waste and
circular
economy
Are major components of
the product recyclable?
8%
No 0
Yes 20
Waste and
circular
economy
Does the manufacturer
operate a take-back
programme?
8%
No 0
Yes 20
Energy use in
manufacturing
Have you calculated the %
use of renewable energy in
final manufacturing stage?
8%
No 0
Yes, each product has <49
renewable energy used in final
manufacturing stage
10
Yes, each product has >50%
renewable energy used in final
manufacturing stage
20
Energy use in
manufacturing
Are your procedures in line
with ISO5001 or similar
energy management
approach?
8%
No 0
Yes, in line with ISO5001 20
Yes, in line with another energy
management approach
10
Water use in
manufacturing
Have you quantified water
use at final manufacturing
stage?
6%
No 0
Yes 20

24. Using the SPIH
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• The SPIH will be accessed through the
new SPHS platform
• Web-based system which will provide a
central point of truth for the SPIH
• Currently being developed and tested

25. Using the SPIH
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26. Index results
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Test organisation
• The platform will provide
feedback to the supplier on
overall scores and module
scores
• Can be used to track
progress over time and
compare suppliers

27. Performance banding
over time
• We received many comments on using the
index to shape the market and it is one of the
key drivers for the Index
• Providing clear signals on expectations and
requirements of suppliers is key
• We are considering a potential model
whereby the ‘baseline’ requirements or
scoring systems become progressively more
challenging over time.
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Example: For a given criteria, what is considered
‘Level 1’ performance in 2021 would become
‘baseline’ performance in 2023. A ‘Level 4’
requirement in 2021 would become a ‘Level 1’
requirement in 2030 etc.. This provides a clear signal
to the market on the expectations of the buyer

28. Questions

29. User journeys

30. Scenario 1: SHiPP country
buyer with diverse supply
chain
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The buyer is located in
Tanzania and would like
to set up an LTA for the
provision of a generic
pharmaceutical.
The main suppliers
are in India and
China.
The suppliers are
well established.
The buyer decides that
sustainability should
be part of the award
criteria for the tender
at a level of 10%.
The buyer decides to place a
minimum requirement of Level
1 to participate. Those that
achieve Level 2, that will receive
5% of the 10% available; for
those who achieve Level 3, they
will receive 10% of the 10%
available.
1 2 3
Scenario: Well established suppliers that meet higher Levels of the SPIH will
score higher at tender stage.
Four companies of
the potential supply
base decide to bid
for the LTA.
6 5 4

31. Scenario 2: SHiPP country
buyer of PharmaceuticalsGLOBAL FORUM 2020
The buyer
would like to
set up LTA.
As part of the
market assessment,
the buyer identifies
that there are a
range of potential
suppliers of the
product.
Many of the
suppliers are small
companies, but
there is a good level
of competition.
To participate in the
procurement event,
suppliers will have
to use the SPIH and
simply disclose their
Level.
The buyer decides to
include in the Terms
and Conditions the
suppliers on the LTA
will have to achieve at
least Level 1 if they do
not already do so by
2023
1 2 3 4 5
Scenario: Small suppliers are able to be procured through an LTA, and work with
the buyer to ensure that sustainability requirements are met over time.
The buyer appoints
three companies to
the LTA.
Four companies
across the potential
supply base decide
to bid for the LTA.
One of the suppliers is located in Spain, and so
does not have to complete the Module on
aspects of the Social Dimensions due to the
SPIH’s country filter and relevant indicators.
Another supplier is located in Pakistan and
therefore does need to complete that Module
based on the country filter.
8 7 6

32. Q&A in 5 mins
Please send your
questions in

33. Piloting

34. Piloting of the SPIH
Who: Buyers and suppliers, from
organisations of any size, geography,
product category
What: To help test the SPIH via a piloting
phase
When: January and February 2021
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If you are interested in being
involved, please contact
ian.milimo@undp.org and
anna.tuddenham@arup.com

35. Piloting of the SPIH We are particularly interested in your
participation if:
- You are in a SHiPP country or have
significant supply chain relations with
SHiPP countries
- Engaged in the manufacturing process or
have Tier 1 suppliers that undertake
manufacturing
- We are interested in participation from
organisations of all sizes
GLOBAL FORUM 2020
If you are interested in being
involved, please contact
ian.milimo@undp.org and
anna.tuddenham@arup.com

36. GLOBAL FORUM2020
THANK YOU