Swedish County Council: Sustainable Procurement for Sustainable Development
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On 11 May 2016, The Swedish County Council has delivered a presentation about steps to sustainable procurement in healthcare and how Swedish healthcare system is causing environmental and social harm in other countries at the dialogue on “Fostering Sustainable Procurement: How Procurers Can Change the Global Health Sector” in UN City, Copenhagen.
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Swedish County Council: Sustainable Procurement for Sustainable Development
- 1. Sustainable Procurement for a Sustainable Development Karin Lonaeus Sustainability Strategist
- 2. Welcome to Ansell Melaka, Malaysia
- 3. Audit: glove production Malaysia
- 4. Swedish County Councils and Regions • 21 county councils • Responsible for - healthcare - dental care - public transport • 250 000 employees • Procures goods and services to the amount of 13 billion euro • Co-operation since 2010
- 5. Pharmaceuticals – India, China Surgical instruments – Pakistan Disposable surgical products – Thailand, Malaysia, South America Gloves – Malaysia, Thailand, Sri Lanka Dressings – China Textiles – India, Bangladesh, Pakistan IT – China, Malaysia Foods – Thailand, Spain, Italy Eight risk areas
- 6. Our way - Five steps to sustainable procurement 1. Code of Conduct 2. Contract Clauses 3. Desktop Follow-up 5. Corrective Action Plan 4. Audit
- 7. Our way - Five steps to sustainable procurement 1. Code of Conduct 2. Contract Clauses 3. Desktop Follow-up 5. Corrective Action Plan 4. Audit
- 8. Special contract terms for social demands 16-05-13 Stockholm County Council 8 The supplier must have procedures in order to ensure that the production is in compliance with the CoC. Routines must include: •Policy commitment •Division of responsibilities at the supplier regarding social responsibility in the supply chain •Requirements on subcontractors in terms of social responsibility •Procedures for risk assessment in supply chain •Procedures for monitoring and verification of compliance •Procedure for handling non-compliance The supplier must have procedures in order to ensure that the production is in compliance with the CoC. Routines must include: •Policy commitment •Division of responsibilities at the supplier regarding social responsibility in the supply chain •Requirements on subcontractors in terms of social responsibility •Procedures for risk assessment in supply chain •Procedures for monitoring and verification of compliance •Procedure for handling non-compliance The supplier is additionally obligated to make it possible for the purchaser, either in person or by a representative, to conduct inspections at the premises of the supplier and/or any of the supplier’s subcontractors in order to ensure that the requirements of § 1 are being fulfilled. The supplier is additionally obligated to make it possible for the purchaser, either in person or by a representative, to conduct inspections at the premises of the supplier and/or any of the supplier’s subcontractors in order to ensure that the requirements of § 1 are being fulfilled.
- 9. Special contract terms for environmental demands 16-05-13 Stockholm County Council 9 The supplier must have procedures in order to ensure: •Compliance with national legislation concerning the environment, safety and health •Monitoring and control of discharge/emissions (incl. API) to the ground, water and air from the production unit •That continuous dialogue is held with suppliers regarding their control of chemical discharges to land, water and air The supplier must have procedures in order to ensure: •Compliance with national legislation concerning the environment, safety and health •Monitoring and control of discharge/emissions (incl. API) to the ground, water and air from the production unit •That continuous dialogue is held with suppliers regarding their control of chemical discharges to land, water and air
- 10. Our way - Five steps to sustainable procurement 1. Code of Conduct 2. Contract Clauses 3. Desktop Follow-up 5. Corrective Action Plan 4. Audit
- 11. Swedish healthcare causing environmental and social harm in other countries The challenges for sustainable public procurement
- 12. The challenges for sustainable public procurement Stakeholder dialogue Long-term vision & coherence Internal coordination of activities
- 13. Strategy: vision- goal- criteria Establishment of permanent platform for stakeholder dialogue to ensure accurate, relevant & realistic criteria (industry, international organizations, NGO’s) Purpose of SPP VisionVision GoalsGoals CriteriaCriteria Follow-upFollow-up Based on risk assessment for each product category Communication Coordination Strategy for (how?)… Communication INTERNAL EXTERNAL
- 14. Strategy: Model and tools for follow-up In dialogue with contracting party Online tool to facilitate interaction & continuous improvements Online tool to facilitate document review & risk assessment Desktop auditDesktop audit On-site auditOn-site audit Continuous Improvement Plan Continuous Improvement Plan Choice of site -Country risk -Product/chain risk -Supplier risk (strength of risk management systems of contracting party) CriteriaCriteriaCoordination/harmonization Establishment of permanent platform for stakeholder dialogue Protocols for defecting scenarios Capacity-building INTERNAL EXTERNAL Sharing of audit reports
- 15. Next steps… Pre-requisites for successful SPP •Internal capacity-building •Internal resources •Transparency of industry & information accessibility •Clear legal framework Next steps •Communicate goals and purpose of sustainable public procurement •Develop clear and shared criteria for SPP of pharmaceuticals •Platform for stakeholder dialogue and development •Online-tool for follow- up •Develop protocols for defecting scenarios •Internal and external capacity-building •Investigate the legal regulations regarding transparency & documentation •Clearly define and communicate the legal framework for sustainable procurement to procurers and practitioners
- 16. Public Procurement can make a difference! Karin Lonaeus Sustainability Strategist karin.lonaeus@sll.se Mob. +46 70 737 58 93
Editor's Notes
- PP is more and more being used as a political tool to reach societal goals. There is much work being done to include environmental concerns into the Good Manufacturing Practice. But that process is slow. Using public procurement is a way to act now. We have since 2010 worked on a national level and coordinate this work. Much more costefficient to do this on a national level since we share the same suppliers and should not invent the wheel 21 times. We are now also staring to cooperate with other countries and hae signed a letter of intent with the Norwegian healthcare.
- We procure goods from developing countries where the risks for environmental affects, human rights viloation and labor rights violations are high. Through our code of conduct for suppliers are we trying to secure that the products we procure are manufacturer in a sustainable and responsible way. So we cannot conduct healthcare in Sweden to the detriment of people in other parts of the world. But also a matter of creating a demand for sustainable products.
- These are our five steps to sustainable procurement.
- Making the demands, i.e. the first two steps, are the easy ones – the next three are the most difficult one. First of all we have a code of conduct for suppliers that have been politically decided upon in all county councils. Based on Global Compact 10 principles We also use the environmental criterias for pharma developed by the National Agency for Public Procurement. These demands are included as contract clauses
- The suppliers also need to have procedures that contains a due-dilicence process according to the UN Guiding principles for human rights and business. The supplier is additionally obligated to make it possible for the purchaser, either in person or by a representative, to conduct inspections at the premises of the supplier and/or any of the supplier’s subcontractors in order to ensure that the requirements of § 1 are being fulfilled.
- Environmental procedures in the supply chain The supplier shall have implemented procedures ensuring that the active substances and other raw materials/chemicals cause as little environmental impact as possible.
- Making demands is relatively easy – Follow-up questions for the social contract clauses Follow-up questions for the environmental clauses developed by Gothenburg University and Professor Larsson. Define where and at what stages there are potential discharges To facilitate on-site audits identify what is actually analyzed and found identify what technical measures used to manage and reduce hazardous discharges. Three county councils have done follow-ups on their environmental demands Three county councils have done follow-ups on both their environmental and social demands Two on-site audits have been done at Pfizer The audit report will always be made publicly available. Obsiously no information on sub-suppliers or intellectual property.
- I will end my presentation by highlighting what we see as a challenge for public procurement being an affective tool. The way forward is that all stakeholders along the pharmaceutical life-cycle cooperates. Assuming responsibility at each level of the value chain. Here are some challenges that needs to be addressed. Harmonization -- The sustainability critera for public procurement needs to be updated. That process will start in October by the National Agency for Public Procurement and will involve relevant stakeholders. The Agency is at the moment putting together expert groups representing government, business, branch organizations, NGOs etc. At the same time those criteria has to be aligned with for example the UNDP, NHS etc) So we do not make different demands than the UN system. Making the relevant demands are important but also harmonizing the way we follow-up and evaluate suppliers. And what do we do when we detect violations? Much of these issues will be discussed more in detail tomorrow. Internally we need to improve the coordination between the 21 county councils. Both when it comes to the demands to make it easier for our suppliers to enter into contracts but also when it comes to follow-ups to avoid overlapping work. Follow-ups are very important – if we do not follow-up on the demands we make we do not only have no control that the products we buy comply with our reqirements. But also we will loose legitimacy. Sufficient resources for follow-ups, building competence and to further address the internal coordination between. We are addressing this this year. Finally I would like to mention Transparency. Sometimes getting insights into our suppliers supply-chain and their methods for ensuring compliance can be difficult. On the one hand the intellectual property of our suppliers have to be protected but at the same time we need to get access to the information in order to evaluate compliance. We need to develop methods and tools for increased transparency.
- – We need to set goals – although our vision is clear we need to, based on risks, set clear goals for where do we want to be in 3 – 5 years time.
- This method has proven sucssesfull in other riskareas and I just want to share some results from recent reports. Last year SwedWatch came out with a report that showed improvements to working conditions in our surgical instrument factories in Pakistan, Last year we detected trafficking and bondedn labor in one of the factories supplying surgical gloves from Malaysia and in January Ansell have adopted a foreing recruitment policy and assume responsibility for all the recruitment costs. And in february Electronics Watch showed how we have made a difference with it-supplier Dell and Labour Rights. So public procurement can make a difference! But we are not satisfied with the model and still have a long way to go and we need to adress some challenges.