Sustainability Atlas
Policy, Standards & Strategy·9 min read·

Case study: Procurement & supplier engagement — A city or utility pilot and the results so far

How cities are using sustainable procurement pilots to cut Scope 3 emissions. Real results from London, Copenhagen, San Francisco, and Portland show what works.

Case study: Procurement & supplier engagement — A city or utility pilot and the results so far

Public procurement represents approximately 13% of GDP across OECD countries, totalling nearly €2 trillion annually in the EU alone. This purchasing power makes municipal and utility procurement a significant lever for decarbonisation. When cities shift their procurement practices toward sustainability, they not only reduce their own Scope 3 emissions but also send market signals that transform entire supply chains. This case study examines how pioneering cities have implemented sustainable procurement pilots, the measurable results achieved, and the lessons learned for sustainability leads considering similar programmes.

Why It Matters

For most public sector organisations, purchased goods and services represent 35-40% of their total Scope 3 emissions. Traditional procurement focused almost exclusively on cost and compliance, leaving substantial environmental impacts unaddressed. Research from the Journal of Cleaner Production found that Scope 3 emissions comprised 65-70% of total emissions in municipal service contracts, highlighting procurement as a critical intervention point.

The business case extends beyond emissions. South Korea's green public procurement programme saved 665,000 tonnes of CO2 equivalent while creating 4,400 green jobs in a single year. Cities implementing sustainable procurement report improved supplier relationships, reduced long-term costs through life-cycle thinking, and enhanced reputation with climate-conscious constituents. As mandatory disclosure requirements expand under regulations like the EU Corporate Sustainability Reporting Directive, demonstrating Scope 3 management through procurement becomes essential for compliance.

The challenge lies in execution. A 2024 OECD survey identified four persistent barriers: perceived cost premiums for sustainable products, fragmented data on supplier carbon footprints, insufficient procurement workforce training, and conflicting objectives across departments. Successful pilots address these barriers systematically, building organisational capability while delivering measurable results.

Key Concepts

Green Public Procurement (GPP) involves integrating environmental criteria into purchasing decisions across the entire procurement lifecycle. This includes specifications that favour lower-carbon products, evaluation criteria that weight environmental performance, and contract terms that require ongoing sustainability reporting. Nearly all OECD countries now have GPP policies, with 70% prioritising environmental goals as their primary strategic procurement objective.

Supplier Codes of Conduct establish minimum environmental standards that suppliers must meet to compete for contracts. Effective codes move beyond general commitments to specific, measurable requirements such as science-based emissions targets, renewable energy usage thresholds, or third-party certification requirements. London's Green Procurement Code, for example, requires signatories to demonstrate measurable environmental improvements and report progress annually.

Scope 3 Supplier Engagement focuses specifically on the emissions embedded in purchased goods and services. This requires gathering emissions data from suppliers, often starting with spend-based estimates and progressing toward supplier-specific data as relationships mature. Leading programmes use tiered approaches, focusing initial engagement on the highest-spend suppliers who typically account for the majority of procurement emissions.

Life-Cycle Assessment (LCA) evaluates environmental impacts across a product's entire life, from raw material extraction through manufacturing, use, and disposal. Procurement based on LCA prevents burden-shifting, where lower procurement costs hide higher environmental costs elsewhere in the system. Portland's low-carbon concrete programme demonstrated that LCA-informed specifications could reduce embodied carbon by 23-34% without increasing project costs.

What's Working and What Isn't

What's Working

Starting with high-impact categories delivers visible results quickly. Portland, Oregon focused its sustainable procurement programme on concrete, a material responsible for approximately 8% of global CO2 emissions. By establishing embodied carbon thresholds for municipal infrastructure projects, Portland achieved 3-35% emissions reductions compared to historically used mixes. A single water reservoir project saved approximately 3.5 million kg-CO2e, equivalent to removing 754 cars from the road for a year.

Collaborative stakeholder engagement builds market capacity. Portland's success stemmed from its multi-stakeholder committee, which brought together concrete producers, engineers, contractors, and architects to develop achievable thresholds. This approach ensured that specifications reflected market capabilities while pushing performance boundaries. Copenhagen applies similar principles through its Big Buyers Initiative, using collective purchasing power to accelerate supplier transitions.

Phased implementation with clear milestones maintains momentum. Rather than attempting comprehensive transformation immediately, successful programmes start with pilots that demonstrate feasibility before scaling. London's Green Procurement Code grew from initial adoption by the Greater London Authority to over 260 signatory organisations, including the Metropolitan Police, which now spends over £1 million annually on recycled products.

Integration with existing procurement processes reduces resistance. Copenhagen requires suppliers using city vehicles to operate on renewable energy, a requirement embedded within standard contract terms rather than creating separate sustainability processes. This integration ensures that environmental criteria receive equal weight alongside traditional procurement factors.

What Isn't Working

Voluntary programmes without accountability produce limited results. San Francisco's consumption-based emissions fell only 2% between 1990 and 2015 despite multiple sustainability initiatives, partly because green purchasing remained optional for many departments. Contrast this with Copenhagen's mandatory requirement that external suppliers use renewable-energy vehicles, which creates clear accountability and measurable compliance.

Overemphasis on certification without performance verification creates greenwashing risk. Some programmes accept environmental certifications at face value without verifying actual performance improvements. Research indicates that certification alone does not guarantee reduced environmental impact; programmes must track outcomes, not just inputs.

Insufficient supplier support creates compliance barriers for SMEs. Small and medium enterprises often lack resources to measure emissions, obtain certifications, or implement required environmental management systems. Programmes that mandate requirements without providing technical assistance effectively exclude smaller suppliers, reducing competition and potentially concentrating market power among large incumbents.

Siloed implementation across departments undermines coherence. When procurement, sustainability, and operations teams pursue separate objectives, conflicting requirements emerge. Portland's success required explicit coordination across Water, Transportation, and Environmental Services bureaus, with shared targets and aligned specifications.

Examples

  1. London Mayor's Green Procurement Code: Launched to help London-based organisations reduce environmental impact through purchasing, the Code has grown to over 260 signatories who collectively diverted over 10,000 tonnes of waste paper from landfill in a twelve-month period. The programme's total procurement value reached £11.8 million in green and recycled products. The Code has been integrated into all Greater London Authority contracts and extended to Transport for London's supply chain requirements. Success factors include practical guidance for embedding green purchasing, regular progress reporting, and recognition for high-performing organisations. The Metropolitan Police, as the largest participant, demonstrates that scale and sustainability can coexist.

  2. Copenhagen's Climate-Aligned Procurement: Copenhagen's CPH 2025 Climate Plan established procurement as a key decarbonisation lever, achieving 72.6% emissions reduction by 2021 against a 2005 baseline. The city mandates that external suppliers use renewable-energy vehicles when operating for the municipality and requires zero-emission technology for construction sites. Under the new Climate Plan 2035, Copenhagen targets 50% reduction in emissions from municipal procurement by 2035. The programme's integration into standard contract terms, rather than separate sustainability initiatives, ensures consistent implementation. Copenhagen's participation in the Big Buyers Initiative enables collaboration with other cities, sharing best practices and aggregating demand to accelerate supplier transitions.

  3. Portland's Low-Carbon Concrete Programme: Portland's Sustainable Procurement Program piloted low-carbon concrete specifications between 2020 and 2021, testing performance across sidewalk ramps, pole footings, and infrastructure projects using Type 1L cement. Results demonstrated 23-34% carbon reductions for average sidewalk ramps while meeting all performance requirements at no additional cost. Following successful pilots, Portland's Water, Transportation, and Environmental Services bureaus formally adopted embodied carbon thresholds in May 2022. The Washington Park Reservoirs project achieved 19% emissions reduction, saving 3.5 million kg-CO2e. Portland's multi-stakeholder committee approach, bringing together producers, engineers, and contractors, ensured that specifications reflected actual market capabilities while driving improvement.

Action Checklist

  • Conduct spend analysis to identify top 10 procurement categories by environmental impact, focusing initial engagement where spend and emissions intensity are highest
  • Establish a multi-stakeholder working group including procurement, sustainability, operations, and key suppliers to develop achievable specifications
  • Pilot sustainable procurement requirements in one or two high-impact categories before scaling, documenting performance data and lessons learned
  • Integrate environmental criteria into standard contract terms and evaluation weightings rather than creating separate sustainability processes
  • Develop supplier capacity-building resources, particularly for SMEs, including emissions measurement guidance and access to technical assistance
  • Set clear accountability mechanisms with mandatory reporting and consequences for non-compliance
  • Join collaborative initiatives like the Big Buyers Initiative or C40 Cities to share best practices and aggregate purchasing power

FAQ

Q: Does sustainable procurement cost more than traditional purchasing? A: Evidence increasingly shows that sustainable procurement achieves comparable or lower costs when evaluated on a life-cycle basis. Portland's low-carbon concrete pilots demonstrated no cost increase on major infrastructure projects while reducing embodied carbon by up to 34%. The perceived "green premium" often reflects incomplete cost analysis that ignores long-term maintenance, energy use, and disposal costs. However, transition costs exist; programmes require initial investment in training, systems, and supplier engagement.

Q: How do we measure Scope 3 emissions from procurement when supplier data is limited? A: Successful programmes use tiered approaches, starting with spend-based estimates using industry average emissions factors, then progressively gathering supplier-specific data from highest-spend vendors. The Greenhouse Gas Protocol Scope 3 Standard provides methodology guidance. Focus initial data collection on the top 50-100 suppliers, who typically represent 70-80% of procurement emissions. Use procurement requirements to drive improved supplier reporting over time.

Q: How do we maintain supplier diversity while raising environmental requirements? A: Phased implementation with supplier support prevents exclusion of smaller vendors. Provide technical assistance for emissions measurement and environmental management system implementation. Consider tiered requirements where SMEs face lower initial thresholds with defined improvement pathways. Copenhagen's approach of integrating requirements into standard contracts, rather than creating separate certification requirements, reduces administrative burden on smaller suppliers.

Q: What regulatory drivers are accelerating sustainable procurement adoption? A: The EU proposes that 50% of procurement budgets target green equipment by 2030, rising to 60% by 2035. The UK Procurement Act 2023, effective February 2025, mandates transparency and simplifies SME access while enabling sustainability-focused evaluation criteria. Mandatory climate disclosure requirements under the EU Corporate Sustainability Reporting Directive and similar frameworks increasingly require Scope 3 reporting, making procurement emissions management essential for compliance.

Sources

Topics

sustainable procurementsupplier engagementscope 3 emissionsgreen purchasinggreen public procurementmunicipal sustainabilitycarbon footprint reductionsupplier codescity climate targetsembodied carbon

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