By using their purchasing power to procure goods, services and works with a reduced environmental impact, governments can make an important contribution towards sustainability goals. High-impact sectors include buildings, food and catering, vehicles, computers, and other energy-using products.
Strategic public procurement
Used strategically, public procurement can contribute to the 2030 Agenda for Sustainable Development by supporting a more resource-efficient economy, stimulating innovation, supporting small and medium-sized enterprises (SMEs) and promoting social values. In recent years, citizens’ expectations have risen, with calls for greater accountability in government purchasing decisions, increasing the need to consider broader outcomes and multi-dimensional risks, including in global supply chains.
Key messages
Public procurement offers an enormous potential market for innovative products and services. Used strategically, it can help governments boost innovation at both the national and local level and ultimately improve productivity and inclusiveness.
Governments can lead by example by incorporating responsible business standards (RBC objectives) in their purchasing policies and practices, to safeguard the public interest and ensure the accountability of public spending.
Context
As large buyers, governments have the power to set standards that can shift markets towards more responsible business conduct (RBC).
While all countries have a framework to support environmental objectives in public procurement, 70% have a framework for human rights, 41% have a framework for gender considerations and 48% for minority issues.
More and more countries are assessing the impact of public procurement on policy objectives
A large obstacle to achieving public procurement outcomes related to innovation, environment and sustainability is using the lowest price as the exclusive award criterion. To encourage the inclusion of more criteria, an increasing number of OECD countries collect data on the degree to which strategic public procurement goals are met.
Related policy issues
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Public procurement is the government activity most vulnerable to waste, mismanagement and corruption. The financial interests at stake, the volume of transactions and the close interaction between public and private sectors in the award of public contracts all pose risks to integrity.Learn more
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Public procurement represents a large share of public spending. Governments can use it to achieve their policy objectives such as a greener economy, stimulating innovation or promoting responsible business conduct. This makes public procurement a complex function requiring a specific skillset for public procurement officials. This is why professionalising the public procurement workforce has become a priority in countries’ public procurement reforms.Learn more
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Large sum of public resources--thus taxpayers' money--spent on public procurement requires not only sound stewardship but also that it be carried out in an efficient way. To this end, governments continuously develop, implement, and revise their procurement systems and various mechanisms and tools. And to assess whether their systems meet their objectives.Learn more