Sustainable Procurement Tools

Overview

 

Security of materials

This guidance relates to the procurement of products or services from sources that are potentially vulnerable to supply disruption. Relevant SPPN examples are as follows SPPN 9/2020 and SPPN 1/2021

This guidance may be considered, where relevant, alongside Construction Policy Note (CPN) 1/2023 which draws attention to the publication of a new chapter (chapter 18) within the Client Guide to Construction Projects.  The guidance provides an overview of the client’s role in planning for sustainability in construction projects, particularly during the project initiation phase.

It is part of a series of guides which support the sustainable procurement duty tools to help public sector organisations embed sustainability into their procurement processes.

Materials security is intertwined with scare or unsustainable materials and these matters should be considered alongside one another. Scarce or unsustainable materials are addressed in the Scarce materials guidance.

Description of risk or opportunity

• are materials contained in products or equipment supplied or used in service delivery potentially vulnerable to supply disruption or constraint?
• are there opportunities to minimise the use of such materials and products supplied or used in service delivery? 

Examples

The risk of supply chain disruption or constraint could be as a result of supply from politically sensitive regions, a supply chain which is restricted to a limited number of suppliers or limited supply sources, or which may be affected by labour, environmental and other factors like civil unrest, crime, natural disaster, or pandemic. For example:

• chemical factory fire in Germany, which controlled the bulk of the market for such chemicals
• rare earth minerals, critical for many electronic products including ICT, disrupted due to restrictions on supply from China
• Japanese tsunami severely affected motor industry and availability of certain parts

The availability of products or equipment that include or rely on minerals, metals, timber, plastics and water, or those including materials that are known to be scarce or unsustainable (critical raw materials (CRMs)) may be affected by such circumstances. For example materials or products used in ICT, furniture, textiles, and construction (e.g. timber, cement and stone). 

The above information is not exhaustive.

Minimising risk

 

It is important to consider how to secure supply chains for key products and services that are potentially vulnerable to security of supply. Managing these risks might include requiring bidders to demonstrate their risk management process including assessment of potential risks, risk mitigation measures including sourcing strategy and stock level strategy, etc. There are also several approaches to minimising these risks:

• effective production techniques: any virgin materials used must be sustainably sourced and through the management of renewable material resources and minimising the impacts of extracting non-renewable resources 
• effective recovery through closed loop systems: use materials as efficiently and sustainably as possible, preserving their value as long as possible, and recovering them wherever possible.
• minimising use / using alternative materials: wherever possible strive to reduce the overall amount of materials used, reduce the amount of primary or new material resources used by replacing these with reused or recycled materials

In addition, the following might be considered:

1. Understanding which items being sourced are likely to be delayed or impacted, and planning for worst-case scenarios.
2. Accelerating the introduction of alternative suppliers.
3. Increasing safety stock levels.
4. Mapping suppliers and identifying those known to be located in high-risk geographies, in order to understand the extent of the potential problem.

Keeping the lines of communication open with suppliers is important, so that the organisation is informed of developments and challenges being faced by suppliers.

A circular economy approach has the potential to preserve valuable raw materials by ensuring that materials are retained within productive use, in a high value state, for as long as possible. It focuses on reshaping business and economic systems so that waste is ‘designed out’ of how we live.