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S3E10 - Sustainable Procurement w/ Bec Timmings
35 Plays12 days ago
๐๐ ๐ฝ๐ฟ๐ผ๐ฐ๐๐ฟ๐ฒ๐บ๐ฒ๐ป๐ ๐๐ต๐ฒ ๐บ๐ผ๐๐ ๐ฐ๐ฟ๐ถ๐๐ถ๐ฐ๐ฎ๐น ๐๐๐ฎ๐ด๐ฒ ๐ณ๐ผ๐ฟ ๐๐๐๐๐ฎ๐ถ๐ป๐ฎ๐ฏ๐ถ๐น๐ถ๐๐?
Sustainability feels expensive and hard when itโs bolted on at the end.
But when procurement is involved early, everything shifts:
โข Sustainability is embedded from planning, not postโdesign
โข Procurement and sustainability teams work together
โข Suppliers help shape smarter, costโneutral solutions
Public procurement is powerful โ it influences 13โ20% of global GDP and can shift entire markets.
Soโฆ is it the most important stage?
We explore this with Bec Timmings, Executive Advisor at ConnellGriffin and a leading voice in sustainable procurement.
๐ We'd love to hear your feedback, share your questions or comments below.
๐ Like & Subscribe so you won't miss out on our upcoming episodes!
๐ Keep up to date with the Infrastructure Sustainability Council:
Website: https://www.iscouncil.org/
LinkedIn: / infrastructure-sustainability-council
#infrastructure #podcast #infrastructureconnections #sustainability #sustainableprocurement #procurement
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Transcript
Effective Use of Public Money for Sustainability
00:00:00
Speaker
When we're delivering that infrastructure, how do we ensure that we're using that public money to the best way possible to achieve those sustainability outcomes?
00:00:17
Speaker
Is procurement the most important stage of sustainability? Today, we're talking to Beck Timmings to find out. She's the executive advisor at Connell Griffin in Brisbane, a civil engineer and fellow of Engineers Australia.
00:00:29
Speaker
She's spent the last 25 years in the infrastructure space. She leads Connell Griffin's net zero capability and in her spare time, she serves as a swim coach at the Special Olympics. I'm Seth Scott, your host, and welcome to another episode of Infrastructure Connections.
00:00:45
Speaker
Well, welcome to the show. Thanks, Seth. Happy to be here. Yeah, thanks so much for being on. So you're working with Connell Griffin and Connell Griffin is working with the ISE to create an impact report on sustainable procurement. What brought this about in the first place and why specifically sustainable procurement?
00:01:04
Speaker
Sure. it It is a little bit of a, I guess, a nexus of a whole heap of um elements that are occurring.
Policy Shift and Procurement Challenges
00:01:11
Speaker
So, Conall Griffin is an infrastructure advisory firm. our Our heritage is in transaction procurement commercial, but um in recent years we've diversified across all of the infrastructure lifecycle.
00:01:25
Speaker
And it just puts us in a really nice position where we consider, understand what's happening both from a policy and a government um lens through to what's happening in the market, what are the market trends, what's being happening what's happening in the infrastructure, um delivery and construction space.
00:01:44
Speaker
um And we can really start to see these systematic barriers. And and with that, ah because of our client side roles, we're seeing the policy changes and the shift in mindset to the executive um organizgan executive managers are within government asking about things like circular economy and decarbonisation and how that fits and how we can help And we can really see that there's this interest, but not really the, there's a real disconnect between how it's being integrated into infrastructure and how the policy has been translated in particular into the procurement phase. We did a recent survey, Conor Griffin and ISE just recently, just to get a feel for
00:02:28
Speaker
what others are thinking. And that really confirmed our suspicions that there's a real intent out there, but people really just don't know what sustainable procurement looks like and how to implement it.
Personal Interest and Net Zero Leadership
00:02:40
Speaker
so um that was, I guess, the work part of it. And on a passion personal or a passionate level, I have always tried to stick my finger into sustainability in any work that I've done. um I have done project delivery, infrastructure delivery, commercial management, but have always sought to try and embed sustainability across that.
00:03:04
Speaker
um And I'm a recent empty nester, so I um have just started a master's in climate change adaption to get some more contemporary knowledge on on at least decarbonisation.
00:03:16
Speaker
um And so, and when I started in Conor Griffin last year, they invited me to to lead the n Net Zero initiative and it was just this perfect, you know, the the market, the industry is looking for change. um They're looking for tangible change within infrastructure delivery.
00:03:32
Speaker
I have a real passion for it. It just seemed like the perfect opportunity to to join partners with IOC and um tackle this challenge to head on. we're glad you did. Especially since um the market seems to think that procurement is really just a procedural issue, something you go through in the tender phase and that you get your costing and your pricing from. But as we started to explore it, it really seemed to be a much more comprehensive way to achieve sustainability. um what's the Why does it play such an outsized role in sustainability and where does it actually come in?
00:04:07
Speaker
Yeah, ah look great question. And i think i think that is it's a real challenge. um There are so many people when they think procurement think of that real transactional back end, you know, RFTs doing the engagement um piece when you have to sign your confidentiality needs and not talk to anyone.
Public Procurement's Role in Global GDP
00:04:24
Speaker
but procurement is so much more and sustainable procurement is so much more. In fact, it's even one of the United Nations Sustainable Development Goals, really about efficient use of public funds and um um and efficient use of resources. um And one of the reasons why it is, it is has such
00:04:46
Speaker
a wide or large ability um to deliver outcomes. um So a United Nations report recently identified that 13 to 20% of GDP globally is in public procurement, and which equates to a $9.5 trillion dollar um figure.
Sustainable Procurement in Australia's Infrastructure
00:05:08
Speaker
So I can't even comprehend what trillion looks like, you know, but that is a lot of money how in public procurement. So if you think about what can $9.5 trillion dollars in public procurement deliver from a sustainability perspective? um And that's a lot. um in Australia alone, um the next five years, we have a $242 billion dollars infrastructure pipeline. and It's the largest we've ever seen. And what we really need to think is this is not just about shifting or building an asset, whatever asset that might be, a school, a hospital, or a a bridge, a railway line. It is about When we're delivering that infrastructure, how do we ensure that we're using that public money to the best way possible to achieve those sustainability outcomes, particularly on those larger projects? And how are we using that purchasing power to deliver real change and a step change towards a more sustainable future? So it is very much thinking about it at that upfront, the business case phase, um and then planning your procurement around how you're going to to leverage um this public money well before you start to build your transaction documentation. So procurement starts very much at that front end thinking about how we're going to best make use of this public value.
00:06:35
Speaker
And that's just public. That doesn't even include the private tire sector that's out there. So that's probably trillion more. Yeah. Yeah. There seems to be this misconception of what sustainable procurement is. um So maybe we should start at the beginning and talk about where does it start and what is it exactly? Yeah. Yeah. And I sort of alluded to it earlier. It.
00:06:55
Speaker
You know, as I mentioned, I think a lot of people think that I get involved when we're writing the tender documentation. So therefore, that's when procurement starts. Not at all. When you are starting to, governments starting to think about we have a a problem that requires investment in public money. That is when we start to think about procurement.
00:07:16
Speaker
um we need to be defining at that very early phase. Not only we need a bridge that goes from A to b we need to deliver infrastructure that supports the decarbonisation of our state or our secure economy principles or jobs and economy, um supply chain mobilisation. We need to be thinking about not only the infrastructure that we want to build, but how... um how we procure that and what other sustainable outcomes we want to achieve. And we need to monetize that upfront in the business case. Otherwise it just gets you know left off during the value engineering phase. So we really need to set our ambitions early. What are the policy um what are the policy settings that we really wanna mobilize through this spend in public value?
00:08:03
Speaker
um And then, you know, really start to think about as we enter into the business case, we're starting to think about how we want to procure this asset. So what is the, how are we going to package um this this infrastructure up to go out to market? You know, what works better, you know, smaller packages, larger packages, how is the market going to engage with that and what gives our best opportunity to deliver the sustainable outcomes we want?
00:08:28
Speaker
We need to think about the commercial model. you know, some form of collaborative contracting alliance, ah ITC, and more of a collaborative of DNC, how is that going to enable the sustainable outcomes that we want um versus maybe the traditional approaches that we've got gone down to? And then how do we engage with the market on this journey to um really make sure that they are up for the challenge and they can inform us on what's working, what can they do, rather than us relying on our way of knowing things, it should be a partnership, a collaborative partnership to bring the infrastructure.
00:09:03
Speaker
So it sounds like it has quite a few more actors than just the procurement department. You're talking about the designers, the engineers, even the contractors, if they can get involved early. And of course your senior management teams.
Misalignment in Procurement and Sustainability Roles
00:09:15
Speaker
What is that big picture of who's involved in and how soon? That was one of the questions we asked in the survey because we were really interested to find out who's getting involved in the infrastructure lifecycle. When are they getting involved and when are they starting to think about ah procurement? um And from the from the survey information we found unsurprisingly, the project director and the project manager is the one getting most involved upfront and early. They are getting providing advice on how this project should be packaged up,
00:09:47
Speaker
the commercial model should be used, how they want to procure it, how they want to engage with the market. Often though, the procurement professionals maybe aren't really, particularly government side, aren't really getting involved until they someone's got the plan already and now they need a procurement professional to document it. So by that stage, some of that thinking is already locked in. And then um surveys also showing sustainability professionals aren't even getting um involved in that thinking right until we start to draft um the tender documentation. So there is this mismatch of, um you know, I guess, understanding of what
00:10:29
Speaker
we can do if we work together a little bit more, understand each capability. and I think one of the things that came out of the survey that was quite interesting, i've just mentioned that the project directors get involved right up front in that early stage. And that as part of the survey, they said, you know what, yep, we're really interested in and we're ready to go in terms of delivering social outcomes, but we don't understand what the requirements look like.
00:10:55
Speaker
And you haven't clearly articulated to us what that means. The is start of sustainability professionals are saying there's not enough good commercial data that supports the sustainability argument. So your project directors are just going with what they know, time, cost, quality. You know, they're not building in that, um that element into into the conversation. so So yeah, I think we really need to, um not only do we need to define a bit more, we need to be working collaboratively together across those key skillsets to really support um integration of the sustainability into that forward thinking around um sustainable procurement.
00:11:33
Speaker
That makes sense. and Sustainability works best when it's baked in earlier and then you get the best outcomes. And then in addition, sustainability tends to encompass all of the departments rather than just themselves or just procurement. So yeah, it makes sense that they tie all of that together into one procurement process. So then that's the ideal way. how are we actually doing this currently in Australia and New Zealand?
00:11:57
Speaker
Yeah, look, I think I've definitely seen momentum there. There's definitely intent, as I've mentioned. ah you know Supply chain and workforce capability has been a longstanding initiative that is is well known. Every up um state agency, the Commonwealth have really rigorous policies and standard settings around that. I'm sure that there is an argument about how effective they are, but they're there. you know and everyone has a common language and we all know what we're working towards.
00:12:25
Speaker
um It's a little bit different when it comes to other elements of sustainability. There's lots of fantastic policies, there's a lot of interest, but they really haven't been translated down into the enabling tools and guidelines um that that we can embed within our um procurement practices. And I think the other one is that... um that they're separate, often they're separate, you know, and and if there's so much information, you don't, people just don't have the bandwidth to go into all the separate um documents. We just need to sort of help them bring it all together. And that's definitely a gap. um and And we've seen that in in globally where there are great pieces of legislation and a real commitment from government to push things through. But when you don't have those enabling tools and templates, you know, the intent of the legislation um falls
New Zealand's Simplified Procurement Approach
00:13:19
Speaker
aside. And, you know, if we think that's where Australia is, but I think if we look at New Zealand, they're they're actually making some really interesting steps um moving forward at the moment. So they have, um towards the end of last year, just um did some procurement reform. um The idea was to simplify their procurement processes, which is amazing. um And they've also introduced a different way of thinking
00:13:44
Speaker
So when we do our evaluation on procurement, we often think value for money, which often translate to to lowest cost. um But they have um changed the narrative. So they are looking at um evaluating public value.
00:14:00
Speaker
And the public value is a mandatory 10% weighting, and it needs to incorporate the economic, the social, the environmental, the sustainability as part of their tender evaluation. um I think that's a really exciting step forward. I think the challenge for them now is translating the policy into the tools and templates and guidance to help um them achieve um that outcome, but they're definitely heading um in the right direction.
00:14:26
Speaker
It's good to see those policies being implemented locally. And you keep mentioning the global aspect of it, especially that procurement is part of the UN SDGs. So what kind of global practices are you seeing internationally that is something that maybe we could bring back home? Yeah, absolutely. um There is a really great picture in terms of what is happening globally. And um the UN SDG has definitely been a core part of that. Europe for many years has had quite strong procurement directive with regards to sustainability and it has filtered into the legislation of all the European states or countries um across Europe.
00:15:08
Speaker
But what we are seeing is the implementation is mixed. Those European countries that have really good tools, methodologies, practices, templates are doing very, very well when it comes to embedding sustainability into their public procurement practices. um But some of those other countries that still don't have those mature systems and tools and processes are floundering, you know, they're still better, probably better than us in terms of they've got some some guidance, um but they're not helping their people to implement that through the tools and practices.
00:15:43
Speaker
um If we look at the UK, I love Googling yeah UK procurement. I know it doesn't sound very exciting, but they have some really cool documents and some really great guidance. um They have these, um the green book, which incorporates, which requires the sustainability to be embedded in the business case, which is really fundamental to that investment funding, that monetization of sustainability. And they have the teal book, which actually helps you embed sustainability practices through the project delivery phase. So we're talking procurement and delivery. um They've got this thing called the Value Toolkit. If you haven't seen it, look at it. It's really, really good. it helps to prioritise your thinking around what sustainability outcomes you're trying to achieve for your projects or your programs that you're delivering.
00:16:32
Speaker
And then most recently, um they've got the Procurement Act 23, which came into effect last year. um And that legally enforces sustainable procurement to um be part of the process. And another thing that I really like about that act is it's really encouraging active engagement with the market during the during and before the procurement practice, which I think is fundamental when you're trying to make transformational change. So, you know, they're two really interesting um areas. And, you know, if you look at that, it's it's very much that this the regulatory setting and then there's the tools, templates and guidance to help people um to, you know, help them do what they need to do to to make that um a reality.
00:17:15
Speaker
It's good if we can get those into a best practice and really start develop it internationally so everyone's on the same page. I think that is part of what the IS rating is designed to do is to make it simple for across countries, across territories and states to actually follow the same programs and mandates.
Australia's Coordination Challenges in Policy Application
00:17:33
Speaker
yup So what's happening in Australia right now when it comes to those policy intentions? What's happening on the ground?
00:17:40
Speaker
Yeah, look, I think um Australia has strong policy and intentions, but it's still fragmented. um If I think about, you know, and news ah New South Wales, they are really leading the way, I think, in decarbonisation. You know, they've got... um They've got some really great tools that um has been taken up by Infrastructure Australia on the monetisation of carbon and embedding those sorts of elements into it. They also have some really strong both Victoria um and New South Wales on circular economy and really starting to build build on those frameworks as well. um We've talked about social outcomes. That's definitely something that is, um you know, quite mature.
00:18:24
Speaker
um across Australia but I think you're right that the the how the how is really still a little bit fragmented and miss and missing. um South Australia have recently implemented a requirement that all government agencies must have a carbon management plan which will filter down into projects and and help to to mitigate their carbon management but that's only one element right so we're we're still sort of tackling the bits and bobs um rather than really starting to build an integrated thinking around, you know when we're doing the the
00:18:57
Speaker
governance and when we're doing the decision making and when we're making those policies, how do they all come together and how do we help to prioritise so that we're not trying to do everything all at once for everything um because that isn't necessarily the um the best way to go. And and what I like, it as you mentioned around the IS ratings, it does, it just really sort of sits within that um it sort of gives that baseline sustainability. So you don't have to use your procurement and your commercial models to achieve everything because you can generally rely on really good specifications, requirements, you know, things like the IS rating. It's then using that procurement lens to shift around what do you actually desire change um within sustainable outcomes to facilitate. So it is really about understanding um the differences and I think at the moment our challenge is that we've got so many policies and so many different directions, we really just haven't coordinated that.
00:19:51
Speaker
And I think that's why there's a bit of confusion around, you know, when the project directors and project managers are like, I'm not really sure what actually you want from a requirements perspective. Don't we have that appendix F on sustainability requirements? Doesn't that cover it? Rather than just, um you know, really starting to think about bringing it up front into that decision making.
00:20:11
Speaker
yeah and you see that kind of fragmentation a lot in governments as they don't want to exactly do what another government is doing. They think they have special circumstances that make them unique and it doesn't apply to them. And you don't always see that as much in business on the private sector because they're looking for best practices that work and sort of not as interested in whether it works
Private Sector Progress and Government Engagement
00:20:33
Speaker
differently. yeah So where where do you see this in the private sector? What's one thing that organizations could do to kind of kickstart their sustainable procurement?
00:20:41
Speaker
I think it's really interesting, this area. I actually think the market is probably, or the private sector is probably more ready for this than than other um areas. and I think, you know, um if you look at it, um a lot of the private buildings that are being built in cities are all, you know, six star green rating. They're funded by private investors that have regulatory requirements in terms of their sustainability. You know, they're,
00:21:10
Speaker
they're already involved. They understand um what the opportunities are. it it's It's our, what we need to do is engage better with private industry. We need to understand how their learnings are in terms of how they have embedded sustainable outcomes um into the way they're procuring and building their projects and planning their projects. You know, I went to a conference a couple of years ago ah on infrastructure and I was just astounded by how many suppliers are out there. They've got all of their, you know, sustainable um products that they sell, they've got all of their certification sheets to demonstrate, you know, um what value it can add, both from a technical perspective in terms of getting the infrastructure outcome that you achieve, but also the sustainability outcomes. that
00:22:00
Speaker
so industry is ahead of the game and we just sort of that we need to work or government needs to work better with um industry or private sector to understand what is out there how can they um adjust um their specifications and when it comes to commercial things a lot of it's around risk So governments often aren't accepting of certain risks um and commercially, you know, um private sector or the market doesn't necessarily want to, you know, be um take on certain risk or they they price up risk. um Is there a solution where risks for unknowns or new evolving technology that comes into sustainability is better shared? um or excluded from some sort of um fixed commercial arrangement just so that we can start to um innovate and work together rather than allowing the procurement and the commercial model to prohibit that sustainability outcomes.
00:23:03
Speaker
You do see that conservatism play a lot, a big role in the process where they're just reusing what they've used and worked in the past, which is fair because it has worked in the past, so why not continue to use it? But that puts the onus on the new product suppliers and manufacturers in the private market to actually go out and educate the procurement teams and say, look, we've got this product that's going to work for you. It actually works better than what you've been doing before, but previously they didn't know it existed. And the procurement teams might not necessarily be going out and seeking those, those new products or or new inventions. so is I think the biggest thing, you know that I think one of the biggest blockers is, well, how does it, how much does it cost me? um You know, what is it going to cost to my bottom line?
00:23:46
Speaker
and And yes, some sustainability elements are, more in the short term, so from a CapEx perspective, but to potentially um a lower cost in the whole of life outcome.
00:23:57
Speaker
But I think, you know, that comes back to public value if we, you know, is it okay to spend a little bit more now if we establish an industry so that the next project and the next project is less?
00:24:08
Speaker
We have these sustainability professionals who are also involved, and obviously they're supposed to be the center of the sustainability world. How do they have more of a direct role in sustainable procurement? How to how do you encourage them to get involved? Okay. Well, I'm hoping that the work that we're doing, Seth, is going to be a big inspiration for them to say it is not all, you know, smokes and mirrors and there is some science behind it and, you know, you need to get involved. But I think firstly it's about um being a little bit more transparent about what the procurement process is and, um you know, that there is that front-end conversation. i think we need to also encourage ah government clients to really start to have those conversations up front a little bit more. So, and I think giving the sustainable professionals the tools to help them change their narrative around not only the specifications, but helping them to understand how their influence is really needed at that business case stage and also during that procurement planning phase. And again, it's about breaking down those silos, right? It's about engaging with the procurement professionals and, you know, I'm
00:25:14
Speaker
very keen on, you know, talking to my my peers um when it comes to the procurement and commercial elements. And I'm constantly asking them, you know, when did you include sustainability and what have you done there? Or, you know, can you tell me how you're doing this?
00:25:27
Speaker
um Have you thought about that? um So i think it is really about opening up those conversations with the sustainability people and the um procurement experts and helping them share it the thinking and the knowledge and just to inspiring each other. Have you thought about this? No, I hadn't. And, you know, let them go on that journey of of you know, testing things and learning about what um is happening elsewhere. And, you know, maybe um hopefully over time with with the help of the um impact theme that we're working on, we can um we can just start to shift the lever a little bit more um and help to um to build the capability of all those those people that are involved in the process.
00:26:11
Speaker
Well, this does seem to indicate that it would answer the big question. Is procurement the most important stage of
Procurement as a Strategic Lever for Sustainability
00:26:17
Speaker
sustainability? It certainly sounds like it's one of the major ones. Oh, absolutely. Yeah, I think, you know, if you're at a dinner table ah um with every single one of those different people in the room, I'm sure everyone would have a very different answer as to whether it is or not. But yeah, I um i strongly believe that is is it is a strict strategic lever that if we use well and we and if we use as a strategic lever, not just as ah as a tick box exercise, we can certainly um really start to make a bit of a difference. And I think it's and just really important to note that it's not just all on government shoulders. It is, you know, let's let's leverage the market and their insights um as part of this process. You can still meet all the probity rules and all the procurement rules, but still um get a really good outcome through through, you know, really smart procurement processes.
00:27:12
Speaker
Well, that sounds great. I'm looking forward to seeing the report when it comes out. Thanks, Seth. Thank you so much for being on the show, Bec. No worries. Thanks for having me.
00:27:22
Speaker
And thank you for joining us for another episode of Infrastructure Connections. Please take a moment to follow us wherever you get your podcasts. And we want to hear your feedback. Leave a comment down below to let us know what you think.
00:27:34
Speaker
Stay tuned for the next episode of Infrastructure Connections.