Net-Zero Procurement

Net-Zero Procurement for System Change

What is Net-Zero Procurement (NZP)?

Here is the the four-part definition:

“Net-Zero Procurement” ensures that buyers…

…obtain best value for money by purchasing…

…the most low-carbon goods & services

…from suppliers who are most committed to science-based net-zero GHG reduction targets and to circularity,

…in support of the buyer’s purpose, policies, and strategic goals.”

See Decoding Sustainable Procurement and Its 4 Starter Subsets blog for an explanation of how Net-Zero Procurement and Circular Procurement are subsets of Sustainable Procurement. They can be used to quick-start sustainable procurement by focusing first on climate-related and circularity-related aspects of suppliers’ sustainability performance, rather than the supplier’s overall sustainability performance.

Context for why NZP is so strategic

Briefing Note

You may have occasion to propose that a government use Net-Zero Procurement. They may prefer that you frame your proposal as a briefing note. This briefing note is designed for use with the Government of Canada. Simply replace Government of Canada (GC) with the name of the federal, provincial / state, or municipal / city government with which you are engaging. It succinctly provides the rationale for Net-Zero Procurement, and how it is the most effective way for the public sector to mobilize the business community in the race to net-zero. The free, open-source Word version of the Briefing Note template can be downloaded here.

Net-Zero Procurement Toolkit

The free, open-source Net-Zero Procurement (NCP) Toolkit  contains templates and tools that enable the rapid and smooth integration of a core net-zero and circular procurement elements into any existing procurement system. The Toolkit contains four core elements:

  • NZP Bid Appraisal Template: This template heavily weights (i.e., 10%-30% of the points) 1)  supplier commitment to net zero targets and circularity and 2) product low-carbon / circular features. The weightings in the appraisal makes supplier and product net-zero and circularity attributes matter. This is the signature feature of a NZCP system.
  • NZP Supplier Disclosure Tool: This tool enables a supplier to assess its commitment to science-based net-zero greenhouse gas (GHG) targets and to circularity. It is the same generic assessment tool that can be used by any organization for this purpose: the Net-Zero Ambition Assessment Tool (NZAAT) In an NZP system, all suppliers ‒ regardless of sector or size ‒ voluntarily disclose their commitment to science-based net-zero targets and to circularity. If a supplier chooses not to disclose, they simply score zero and will not earn any of the points allotted to supplier commitments (see above).  The scores become part of the supplier’s profile and can be updated at any time. New suppliers complete the assessment as part of their bids.
  • NZP Sample Product Specifications:  This is a checklist of low-carbon / circular specifications that can be used in RFPs to ensure goods and services are low-carbon and circularly designed. These specifications are in addition to the normal quality and performance specifications required by the user.
  • NZP Sample Terms & Conditions (Ts & Cs): Contracts with winning suppliers stipulate an appropriate combination of incentives, penalties and conditions that reinforce supplier commitment to net-zero targets and circularity.
  • Bonus: Total Cost of Ownership (TCO) Tool: This tool monetizes all ongoing direct and indirect costs, benefits and value associated with an acquisition. That is, it helps determine if initially paying more for the goods and services is the best long-term financial decision. It is used when appraising bids for large capital goods / assets. It can be used with any purchase, not just sustainability-related or climate-related acquisitions. It is also helpful when comparing lease vs. purchase options.

Click here to download the NZP Toolkit.
Click here to download a flyer that provides an overview of the NZP Toolkit.

Feedback: The toolkit is being continuously improved. Your suggestions are welcome. Please send your ideas to bobwillard@sustainabilityadvantage.com. Thanks.

Sustainable procurement slides 

The Master – Sustainable Procurement slide deck is one of the six slide decks available to Master Slide Decks subscribers. It includes:

  • What, why and how of Sustainable Procurement (SP)
  • What, why and how of Net-Zero Procurement (NZP)
  • Status of NZP
  • Support organizations