The topic of linking public procurement and Corporate Social Responsibility (CSR) becomes ever more important for cities when challenges are increasing and public resources are limited. So how can city leaders actively use strategic procurement to encourage businesses to fulfil their social and environmental responsibilities? Dr. Steffen Wetzstein, Lead Expert for the URBACT CITIES4CSR network, shares recent experiences from URBACT cities…

Linking up strategic municipal procurement and Corporate Social Responsibility

The link between strategic municipal procurement and Corporate Social Responsibility (CSR) may seem complex. On the one hand, city governments are under pressure to procure important goods, services and works in the name of the public good, and on the other hand, CSR is about businesses donating and contributing to worthwhile ‘beyond-profit’ causes in return for publicity and marketing gains. But can city leaders actively and effectively use procurement processes and practices to make businesses fulfil their social and environmental responsibilities? And could this direct influence made our world a better place after all?

But there is hope for change, because the European urban procurement communities and CSR communities have recently started to link up. Well-known experts representing these networks – Matthew Baqueriza-Jackson as Lead Expert behind the URBACT networks Procure and Making Spend Matter, and Valentina Schippers-Opejko on behalf of the EU Urban Agenda Partnership on Innovative and Responsible Public Procurement – have been sharing their experience and wisdom with URBACT cities. They both joined meetings with the 10 city partners in our URBACT CITIES4CSR network, the first ever URBACT network building municipal capacity for promoting urban CSR ecosystems and practices.

This article asks what – after two and a half years of dedicated URBACT project work – is the local state-of-play regarding municipal procurement, what has been achieved so far, and what kind of barriers had to be overcome.

Lessons from our URBACT partner cities

1. Budaörs, Hungary: room for advancing local practice

For its URBACT Small Scale Action – tree planting and ‘green’ public awareness and education – the current procurement framework was considered adequate. Less satisfying, however, is the fact that the municipality currently does not give any consideration, preference or advantage to companies that have demonstrated good CSR practices. Part of the problem is that there is no useful administrative system in place to meaningfully compare and evaluate companies’ CSR activities.

2. Nantes, France: successfully linking CSR and SDGs

Nantes’ Small Scale Action, a digital observatory monitoring businesses’ performance concerning progress on achieving Sustainable Development Goals (SDGs), is currently being assembled utilising best practice procurement. Despite being below the necessary threshold, it was decided to proceed as a call for tender precisely to allow the promotion of good practices. Broad digital advertising was followed by constructing an objective analysis grid that besides social and environmental criteria also incorporated competency aspects, quality dimensions, costs and deadlines. Finally, the assessment of the offers from potential service providers was assigned to selected URBACT Local Group (ULG) members in the name of openness and transparency.

3. Guimarães, Portugal: learning to be alert and flexible

Yet, three lessons had to be learned along the way. First, keep your options open concerning your supplier. Early on, the project team noticed feedback issues and failed deadlines with their preferred supplier, and were eventually forced to work with an alternative organisation. Second, in the teams’ own words “one must have a political champion, for every project, and must try to stay ahead of the political changes”. Having unexpectedly lost their project champion, the Councillor for Economic Development, officers eventually had to convince the Mayor directly, but lost four weeks into the process. Third, project management has to try to keep ahead of the game by anticipating and responding swiftly and adequately to almost unavoidable delays triggered by the fiddly specificities of procurement procedures. Luckily, a dedicated administrative department successfully helped to navigate those tricky roadblocks.

4. Vratsa, Bulgaria: taking risk more seriously

Reflections, recommendations and potential actions

CITIES4CSR case studies highlight at least three key lessons regarding effective municipal CSR-directed procurement.

1. Rigid and bureaucratic national procurement frameworks may hinder CSR-directed goal setting and implementation. Effective lobbying for more flexible national laws may help to innovate.
2. Local-level project management capacities need to match vision and aspiration, including adequate legal competencies and solid administrative skills. Awareness-raising, targeted training and good practice dissemination may improve this situation.
3. Politics both enables and restricts innovative approaches to embedding local economic, social and environmental considerations in procurement. So changes in political leadership may cause the biggest risk. Strategically anticipating and skillfully navigating these risks may prove essential.  

Clearly, strategic municipal procurement and CSR capacity building belong together. Procurement is potentially a powerful tool to directly influence CSR-mediated actions, practices and outcomes. Municipalities really are in the driver seat. Boldly and creatively confronting key barriers promise two inter-related outcomes. Guimarães (PT) illustrates how we may aspire to achieve a local win-win between business/economic and social/community stakeholders in terms of responding to needs quickly, competently and effectively. Let’s call this ‘small win-win’. Yet, if we look to Nantes (FR), we can aim even higher. Eyes could be set at a ‘big win-win’ by aligning our collective urban practices with reaching our global Sustainable Development Goals.

This article demonstrated the value of thinking and doing municipal CSR capacity building, and strategic municipal procurement, together. So mutual engagement, co-learning and shared capacity building should be intensified in challenging post-pandemic years. Improved two-way communication would be a starter and a more conceptually grounded debate desirable. Common initiatives may produce powerful shared messages to stakeholders and the wider public – perhaps already at our planned CITIES4CSR outreach event in Brussels on 30 June and 1 July 2022! Longitudinal and strategic project formats both locally and transnationally should be the ultimate goal. Let us unlock together the potential of strategic procurement for much needed social and environmental progress now!

Find out more about URBACT’s support to towns and cities looking for better ways to buy goods and services – with articles, practical advice, and a free online course on strategic procurement: URBACT strategic procurement Knowledge Hub.

Over the last seven years, the URBACT programme has sought to adapt the ways in which towns and cities across the EU think about their purchasing. The URBACT networks Procure and Making Spend Matter, our online course on Strategic Procurement, and our representation on the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement have all sought to shift the perception and practice of procurement away from something very boring and bureaucratic to something that is exciting and effective in addressing the challenges that cities face.

Cities, including their municipalities and other institutions, use procurement every day to buy goods and services, ranging from construction projects to school catering. The process is framed by legislation from the European Commission in the form of the European Procurement Directives – and the choice of suppliers to provide a good or deliver a service has often been on the basis of price alone, with the cheapest offer winning the contract.

Purchasing for recovery: choose quality and wider benefits

Our thinking at URBACT on procurement continues to evolve. In particular, and as a result of the Covid-19 pandemic, we have been involved in developing a new Action Paper for the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement, published in January 2022 for public feedback. We identified ten ways in which public procurement can be utilised to stimulate and enable economic recovery in a post-Covid world. Municipalities and other institutions should:

1. Pay suppliers quickly, enabling the circulation of money within the economy to be quicker and reducing the risk of businesses facing cash flow and liquidation challenges.
2. Use social criteria to create jobs, as this contributes towards addressing the key challenge of unemployment, particularly among young people.
3. Encourage suppliers to upcycle products using a circular approach. This reduces waste, both in cost and environmental terms.
4. Encourage suppliers to adapt their products and offer, enabling businesses to diversify and grow.
5. Raise awareness among local businesses of upcoming procurement opportunities. This both enables the growth of local economies and reduces carbon emissions.
6. Connect with SMEs – the largest component part of the economy. Towns and cities benefit from supporting these businesses and the jobs they provide.
7. Give consumers a say. Citizens are the people who pay for procurement spend through the redistribution of their taxation, and they should have a voice in how that money is spent.
8. Be strategic. Develop a coherent procurement strategy, outlining in a clear way the types of economic outcomes the city is seeking to achieve.
9. Support innovation, as it enables new goods, services and works to be developed.
10. Enable group bids. Bringing organisations together to bid for procurement opportunities enables smaller businesses to deliver economies of scale.

Linking the ten ways to the cycle of procurement

A new, healthier economic recovery

In all of the above, there is a need to consider how we think about ‘economic recovery’. Traditionally, economic recovery would have been predicated by a return to economic growth in the form of Gross Domestic Product (GDP). The Covid-19 pandemic presents an opportunity for a new type of recovery which is framed not only by considerations of economy, but also by addressing social, cultural, health and wellbeing, and environmental challenges.

In terms of the resources that cities have at their disposal to realise this more integrated approach to recovery, we at URBACT firmly believe that procurement is core. Existing money can be levered in different ways to support not only high-quality goods and services, but also contribute towards realising more effective local economic, social and environmental outcomes.

URBACT procurement support for cities

URBACT provides tools, capacity-building and exchange opportunities to ensure procurement is integral to a strong, integrated recovery in EU towns and cities. As well as taking the ten steps described in this article, we invite city hall staff and other urban practitioners to:

• Visit the EU Urban Agenda Partnership on Innovative and Responsible Public Procurement – and read the Action Plan 2022.
• Follow the free URBACT online course on Strategic Procurement, with a new module on Gender-Responsive Procurement due to be released by June 2022;
• Sign up to our quarterly newsletter to join a growing community of peers and keep up-to-date on how to apply procurement more strategically in cities!

Matthew Baqueriza-Jackson is an URBACT Lead Expert and represents URBACT in the EU Urban Agenda Partnership for Innovative and Responsible Public Procurement.

Since 2015, URBACT has been at the forefront of supporting cities in using public procurement as a strategic tool to tackle their social, economic and environmental challenges.

In his recent article on URBACT and Public Procurement, URBACT expert Matthew Baqueriza-Jackson notes that the perception of public procurement is changing, “from something… shrouded in bureaucracy and challenges, to something which is integral to ‘integrated urban development’ and exciting”.

The recent URBACT Online Course on Strategic Procurement confirmed that there is a growing community eager to learn from each other on how to apply procurement more strategically in cities. URBACT is committed to supporting this community in collaboration with the European Commission, EU Urban Agenda Partnership on Innovative & Responsible Public Procurement, EUROCITIES and many more players!

What happened in March 2021?

The first ‘learning cycle’ of URBACT’s online course was a great success! It ran over a three-week period and was followed by more than 600 registered participants from over 40 countries and 150 cities across the world!

The course comprises seven modules covering the whole procurement process from recognising why procurement is important and analysing your city’s spending… to deciding contracts and monitoring those that have been awarded.

Every week, new modules were released on the URBACT Toolbox – allowing participants to learn about each step of the procurement cycle based on city case studies.

All training is provided through short videos presented by co-trainers Matthew Baqueriza-Jackson – URBACT Expert of PROCURE (2016-2018) and Making Spend Matter (2018-2021) networks – and Valentina Schippers-Opejko – Coordinator of the EU Urban Agenda Partnership on Innovative and Responsible Public Procurement.  The videos are supported by resources for further knowledge and guidance.

Matthew explaining the Importance of Procurement and the structure of the course in Module 1

As part of this first learning cycle, the modules were supported by weekly live events. While the modules remain accessible to everyone at all times, these live events provided participants a moment to network, meet their trainers and discuss the learning outcomes. More than 150 people from over 30 countries and 70 cities took part in the live events!

URBACT pushing the debate on public procurement

One week after the launch of the online course, URBACT organised the first live event in collaboration with the EU Urban Agenda Partnership on Innovative & Responsible Procurement. This event invited speakers from EUROCITIES and the European Commission for a panel discussion on the different dimensions of the EU policy framework.

Speakers emphasised some of the key messages of the course. For example, the “importance of having a different vision of public procurement and using it as a lever to develop a better quality of services to our citizens,” was mentioned by Ivo Locatelli, from DG GROW, European Commission.

Ieva Cerniute, from DG REGIO, added that “around 50% of the EU cohesion policy is channelled through public procurement” and highlighted the work of the Commission in “promoting a strategic way of using public procurement in the cohesion policy while investing in EU funds”.

Anja Katalin de Cunto, coordinator of the Big Buyers Initiative at EUROCITIES, insisted on how important it is to “continue working and collaborating with the market not only with big suppliers, but also the local suppliers because the dialogue has to be in both directions”.

While there are no plans to update the current EU Directives on public procurement, speakers agreed that there is room for improvement within the current framework. Investing in capacity-building for public buyers to maximise existing possibilities, for example, was said to be a priority.

The speakers also indicated that food procurement is another critical area for improvement to allow cities to buy more locally and use procurement as a lever towards developing local food systems. This can help protect citizens’ health, the environment and support the local economy – closely aligning with the work of URBACT’s Transfer Network Bio-Canteens and URBACT’s wider influencing efforts leading to COP 26.

Finally, Matthew announced that URBACT is currently researching on the impact that public procurement has on women. Building on the great collaborations developed in the framework of Gender Equal Cities and the momentum of this online course, URBACT is organising a thought-provoking session on ethical and gender-responsive procurement at the 4^th URBACT City Festival, taking place online on 15-17 June 2021.

What did participants think of URBACT’s first learning cycle on strategic procurement?

The feedback on the course was overwhelmingly positive! Participants praised both the content of the course and the structure of the learning cycle. More than 95% of the participants felt that they could put what they learned on strategic procurement into practice within their city and would recommend the course to others. Participant feedback included the following quotes:

“The URBACT Online Course on Strategic Procurement is a great learning [resource]. I found it a great opportunity to learn and update my knowledge... I enjoyed the course from the beginning till the end...”

“I liked the possibility to watch courses when it suited me… [Since] there was a possibility to watch them when you wanted, that was really helpful in times when there are a lot of online meetings to schedule.”

What is also striking is the diversity of the participants, including not only urban practitioners looking to undertake strategic methods in their procurement processes, but consultants, researchers and students engaged in the topic. Interestingly enough, while numerous URBACT beneficiaries took part in the course, most registered participants were not previously involved in the URBACT programme, either as experts or as city partners. URBACT will continue to facilitate learning exchanges among this community to keep the course content alive.

Wish you’ve had the chance to join?

The first learning cycle may have ended, but the opportunities to benefit from the wealth of URBACT knowledge on strategic procurement are far from over.

Interested in further expanding your knowledge on public procurement? Sign up for the session on Ethical and Gender-Sensitive Procurement at the 4^th URBACT City Festival, taking place online 15-17 June 2021. Make sure to save the date already and click here to register!

Don’t miss out on these opportunities to build your capacity on the topic of strategic public procurement – an ever-more-important lever to drive positive change within cities and communities. We hope to see you online soon!

Nouhaila Bouhout is a Communications Officer at the URBACT Secretariat. One of her main projects is designing and implementing the digital communication strategy of the URBACT Online Course on Strategic Procurement.

As part of this wider set of activities, our Transfer Network asked Matthew Baqueriza-Jackson  to provide Ad-Hoc Expertise around the topic of public procurement. All of us felt it would be important that if a new approach to regeneration was to be realised, then there also had to be a focus upon procurement – and particularly how municipalities spend their own money and encourages others such as developers and regenerators to think about how they do so.

Read more about it in our new product created by ad hoc expert Matthew Baqueriza-Jackson.

Public procurement continues to grow in importance across Europe and will be integral to our responses to Covid-19 and the continuing economic, social and environmental challenges that cities face. In this article, I’ll tell you how URBACT has been working to influence this agenda and ensure it remains a core component of Integrated Urban Development long into the future. There is great potential here that needs to be unlocked!

Bringing public procurement into the light

Over the course of the last five years, and instigated by the experience, knowledge, and desire of the City of Preston, URBACT has undertaken a number of activities around the topic of public procurement. I, Matthew Baqueriza-Jackson, as Lead Expert, Ad-Hoc Expert, URBACT representative and trainer have been lucky enough to help shape and animate that activity utilising my knowledge and expertise. 

Collectively, we have turned public procurement, as a theme, from something that has always been shrouded in bureaucracy and challenges, to something which is integral to ‘integrated urban development’ and exciting. By this we mean, public procurement can be used as one of the levers which city authorities have at their disposal to address economic, social, and environmental challenges; and as a means of bringing together different stakeholders to improve outcomes.

The work around public procurement undertaken by Preston, URBACT and its participating cities and networks - as described below - has culminated in the production of the URBACT ‘online course on strategic procurement’, which will be launched in March 2021. The course - which involves 7 modules and accompanying city case studies from URBACT - utilises this depth of experience and expertise to provide a step-by-step approach as to how cities can be more strategic in public procurement. Interested? Save your spot by registering online.

So, what have we collectively done around public procurement?

URBACT’s work around public procurement commenced in 2015, with the launch of the Procure Action Planning Network. Led by the City of Preston and involving ten other cities, this network started the journey to change the perception and role of public procurement. Our core finding from three years of action planning activity was that public procurement has to be viewed as a ‘cycle’. To be able to embed social and environmental outcomes into public procurement, there has to be:

• political buy-in and a willingness to change public procurement cultures;
• an understanding of where existing municipality procurement spend goes and how much is spent;
• an overarching procurement strategy or approach - which as well as legislative requirements, details the economic, social and environmental outcomes a municipality wants to achieve through procurement;
• a reflection upon the relevance of those wider outcomes during the design of goods, services or works (commissioning);
• questions asked around these wider outcomes during tendering, and evaluation of responses during decision-making and selection of the winning supplier;
• monitoring of the extent to which those wider outcomes are achieved during the delivery of the good, service, or work.   

Feeding into the EU Urban Agenda

In 2017, the City of Preston and I (as an URBACT representative) were asked to participate in and observe the activities of the EU Urban Agenda Partnership on Innovative and Responsible Public Procurement. The Partnership, through engagement with the European Commission, other European programmes and institutions, and regions and cities, sought to further advance the use of public procurement as a means to delivering key economic, social and environmental outcomes.

In practice, URBACT’s role has been far from simple ‘observation’ – indeed, with the City of Preston, we have led the development of the Partnership’s Measuring Spend and Wider Impact Action and have contributed towards the Building Strategy Action.

Supporting city transfer of good procurement practice

Also in 2017, the City of Preston was awarded URBACT Good Practice status for its work around ‘spend analysis’ and how it can be used to progress procurement processes and practices. In 2018, the Making Spend Matter Transfer Network started the journey of transferring this Good Practice to six other cities.

The Network is due to complete its activities in June 2021, with the cities working on understanding, adapting, and re-using the Good Practice in their own contexts, and the City of Preston importantly improving it. The Network will launch its final output - a Toolkit on how cities can be more strategic in public procurement, at a conference in March 2021.

Since 2019, URBACT has also started to integrate public procurement learning into other network activities. As part of the evolution of the Implementation Networks, URBACT produced a Guide about the implementation challenges of public procurement and how they can be overcome, with case studies detailed throughout.

The Playful Paradigm and Urban Regeneration Mix Transfer Networks are also embedding exchange and learning activities around public procurement into their networks, for which I have been providing ad-hoc expertise. Playful Paradigm has produced the ‘Playful Paradigm Procurement Guide’, which talks through the stages cities need to go through to purchase goods, services, and works associated with play and games. Urban Regeneration Mix are exploring how public procurement can be used to deliver regeneration outcomes, with this a key topic of conversation at their upcoming Exchange and Learning Seminar.

Spreading procurement knowledge beyond URBACT!

In 2018, URBACT, started the process of formulating an online course, using this wealth of knowledge, experience, expertise and outcomes. During the 2018 URBACT City Festival in Lisbon, I led  a Lab Session entitled ‘Buying a Better Future’. The session reflected on the core findings of the Procure Network, and how the steps of the procurement cycle could be translated into real procurement exercises.

This has developed into what has become the URBACT ‘Online Course on Strategic Public Procurement’ to be launched in March 2021 – don’t forget to register now!

What is more, this course will not be the end of the journey. In fact, it is just the start of embedding our learning from our networks and involvement in the EU Urban Agenda Partnership to a bigger and wider audience. Please join us to see what you can learn and use for the benefit of your city!

Matthew Baqueriza-Jackson is the Lead Expert of Making Spend Matter. He has represented URBACT on the EU Urban Agenda Partnership on Innovative and Responsible Public Procurement and is the Co-Trainer for the ‘URBACT Online Course on Strategic Public Procurement’.