JIMMA UNIVERSITY

College of Business and Economics

Department of Accounting and Finance

PROGRAM: - Project Management and Finance (MPMF)

ASSIGNMENT ON SPP

PREPARED BY: -GROUP 3 (5&6)

 GROUP MEMBERS
1) Mahammadsani Ali
2) Mahammad Jafer
3) Jabesa Birhanu
4) Ahmed Mohammed
5) Endale Abebe
6) Abdurehman Haji
 Contents /outline

• The concept of sustainable procurement

• Aims and challenges
• Benefits of sustainable project procurement in
terms of social, economic and environmental
• Barriers and drivers
• How organizations develop sustainability in
procurement
• How sustainable procurement sustain project
 Learning Objectives

• After the Successful completion of this

Presentation, we will be able to:
 understood concept of project SPP

 Distinguish the Benefits of sustainable project

procurement
 Identify Barriers and drivers of SPP and also
how organization develop SPP
Concept of sustainability is seen in 3 ways
 Cont….

• Environmental aspects; the effects on the

environment that the assets, supplies and/or services
have over the whole lifecycle
• Social aspects: effects on issues such as poverty
eradication, inequality in the distribution of
resources, labor conditions, human rights, Fair-trade,
Sustainable or recycled materials/products.
 3.1 concept of Sustainable procurement

 is the process by which organizations buy

assets, supplies or services by taking into
account a number of factors including:
• Value for money considerations such as:

• price, quality, availability, and functionality of

the entire life of the products.
 Sustainable procurement (SP)
• is about taking social and environmental factors
into consideration alongside financial factors in
making procurement decisions.
• It involves looking beyond the traditional
economic parameters and making decisions
based on the whole life cost, the associated
risks, measures of success and implications for
society and the environment
• It’s all about sustaining project logistic activities
 Cont…
• SPP is now a key element of many governments, projects
and businesses and not-for-profits’ sustainability or
corporate social responsibility strategies

• SP operates under the principles of “fit for purpose” and

“value for money” and when done properly will assist
organizations ensuring they spend their money efficiently,
effectively and ethically.

• SP looks beyond up-front cost and looks at the entire life

cycle of the product, taking into account costs, social and
environmental risks and benefits.
 3.2. Potential benefits of
sustainable procurement include:

• more efficient and effective use of natural resources

• reducing the harmful impact of pollution and waste
• reducing the impact of hazardous substances on
human health and the environment
• encouraging innovation
• providing strong signals to the sustainable products
market
• Practical expression of organizations’ commitment
to sustainable development
 3.3 Benefits of sustainable proc for
Customer

• Securing best value for money and efficient use

of resources
• Financial savings through greater efficiencies in
energy, waste, water, raw materials, etc
• Reputational boost through providing leadership
and demonstrating corporate responsibility
 Benefit for Supplier/Marketor

• Increasing the availability of cost-effective

sustainable products
• Expanding the market for sustainable products
and services
• Increasing opportunities for smaller, innovative
suppliers with strong product differentiation.
 Benefit for Community

• Reducing adverse environmental impacts e.g.

waste, pollution, carbon emissions

• Increasing employment and skills and
developing local communities
• Creating new business opportunities for a wide
range of large and small businesses
 3.4 Drivers of SP procurements
 Drivers for sustainable procurement depend on the

motivations of the company. Broadly, drivers can be

grouped into four key areas:

1.Cost/Income –increase efficiency in supply chain

2.Compliance- engage with Gov/other influential body

3.Reputation – respond to customers , investors/sevil society

4. Organizational- attract talent and retained staff

 The main drivers towards achieving
sustainable procurement are

• effective organization wide policies to ensure

that everyone is aware of the strategy
• Training And Guidance to help all of those
involved in procurement to understand
sustainable procurement and whole life
costing;
 3.5 Barriers of SPP
• Not everyone may appreciate the opportunities
provided by sustainable procurement.
• Anticipating barriers and having a plan in place to
address them is essential.

Well documented barriers include:

• Lack of senior executive and organizational support;
• Lack of coherent corporate procedures, systems and
approaches;
• Lack of time resources, knowledge and capacity; and
• Costs, perceived costs and cashable savings.
 How organization develop SPP?

• To develop SPP Organization have to pass in 6 stages

1. Identifying Sustainability need

2 Analyzing sustainability needs
3: Develop sustainability requirements and
evaluation methodology
4: Select supplier and award contract
5: Manage contract implementation
6: Post-contract implementation checks
Cont.…
IN SUMMERY
• We have tried to cover the following questions
1- What is Sustainable project procurement?
2- what is concept of sustainable procurement?
3- Aims and challenges ?
4- Benefits, Barrier and driver for sustainable project
procurements ?
• Generally, procurement process is viewed as involving
sourcing (planning: needs identification and
assessment, supplier selection) contracting,
monitoring and evaluation, and expediting; based on
the model definition by Van weel (2002).
 Reference
• Project Procurement Strategy for Development: Long Form
and short form detailed Guide
• United Nations General Assembly –UNGA (1987), Report
(online version) of the World Commission on environment and
development: our common future.
• Walker, H. and Brammer, S. (2009); Sustainable procurement in
the UK public sector, supply chain management, an
International Journal, Vol 14. No.2, pp.127-38
• Walker, H. and Wendy, P. (2006); Sustainable procurement:
emerging issues,; International Public Procurement Conference
proceedings, 21-23 September, 2006,2005 Unilever
Environmental and Social Report