The interest for applying the UN’s 17 Sustainable Development Goals in tender procedures has increased significantly in recent years. But how can the goals be incorporated into the tender documents and the subsequent contract?

The UN’s Sustainable Development Goals consist of 17 specific goals and 169 subgoals, which came into force on 1 January 2016. The goals obligate all the UN’s 193 member states and are relevant to all, both companies, municipalities and citizens. The goals concern poverty eradication, sustainable economic growth, decent work, climate, peace and gender equality.

So far, the goals are the most ambitious global development plan ever made, and they are setting the course for a more sustainable development of the world until 2030.

Why are the UN's goals relevant in a tender procedure?

Since the goals were introduced, both public authorities and companies have had an increasing interest in how to apply the goals and general CSR. For example, many municipalities have incorporated the goals into their procurement policies for the purpose of influencing the companies’ conduct in a more sustainable direction.

But how do you transition from the general procurement policy to working specifically with one or more global goals in a tender procedure?

When you incorporate the goals into the tender documents, it is important to note that the Public Procurement Act has a number of requirements as to how public contracting entities may safeguard public interests in connection with public procurement. The Public Procurement Act contains a number of mandatory and voluntary grounds for exclusion creating an incentive for the businesses to stick to the straight and narrow path. On the other hand, the Act also lists the limitations as to which requirements may be made to the procurements and the tenderers.

How can you specifically apply the goals in a tender procedure?

Public authorities have great freedom of choice of methods when they wish to apply the goals in a tender procedure. As regards municipalities, the rules on local government mandate and the Public Procurement Act mainly lay down the limits of how to pursue each goal.

First, you may adopt an overall policy and procurement strategy which incorporate some of the specific goals. It will be relevant to select the goals which are most central to the municipality’s or the company’s procurement.

In the specific tender documents, you may lay down requirements that concern the goals. This may be done in the following ways:

  • Special environmental or safety requirements, including environmental arrangements and certificates. Remember that the requirements must be related to the subject-matter of the contract and not general conditions at the tenderer.
  • Requirements for the company’s suitability, e.g. a requirement for specific measures concerning environmental control which the company must apply when performing the contract.
  • The contract must contain clauses that list special requirements which the supplier must fulfil in the term of the contract. This could be clauses concerning labour, employment or trainees.

When the tender procedure has been completed, it is decisive that the contracting entity follows up on and communicates with the supplier to ensure that the requirements listed in the tender documents are realised and fulfilled on a regular basis. At the same time, you may establish a partnership via the contract to further incorporate the goals into the procedures relevant in connection with the performance of the contract.

Which of the UN's goals are particularly relevant in tender procedures?

In principle, all of the goals may be relevant in tender procedures. Still, we find that a couple of the goals are particularly central and relevant to public procurement.

Goal no. 1: No poverty

To end poverty is still one of the greatest challenges globally, which is reflected in goal no. 1. The goal concerns a targeted effort in relation to vulnerable groups, increased access to basic resources and services.

Via a tender procedure, a public authority may support this goal by applying labour clauses. A labour clause may demand that employees participating in the performance of a contract are guaranteed a minimum level as regards pay, working hours and other working conditions.

The application of labour clauses is relatively widespread with public authorities in Denmark. It is characteristic of these clauses that they typically apply only to work performed in Denmark. This means that the public authority does not have the same degree of control as to whether work performed outside Denmark takes place on well-regulated conditions. At the same time, it has turned out to be practically challenging to enforce labour clauses in a way which actually takes into account the employees. The work of developing the labour clauses is pending and is - in our opinion - an obvious possibility of supporting goal no. 1 in connection with public procurement.

Goal no. 5: Gender equality

In the tender documents, you may incorporate a requirement the purpose of which is to promote equality among men and women at the workplace, increase women's’ participation in the labour market and create a work-life balance.

For example, if the contracting entity demands that the purchased product has a Fairtrade mark which is an international mark to ensure better pay and working conditions for the world’s exposed workers, including to support women achieving equality, equal pay and higher education.

One of the most recent trends is to demand that the supplier ensures a minimum staffing of e.g. 25 % women in connection with the performance of the contract. Such clauses require a sharp pen so that it is clear what it takes for the supplier to fulfil and document the requirement.

Goals nos. 12 and 13: Responsible consumption and production and climate action

Goal no. 12 concerning sustainable consumption and production and goal no. 13 to combat climate changes and their impacts are some of the goals on which there is increased focus in tender procedures. A report from the Competition and Consumer Authority from January 2021 concludes that up to 50 % of the contracts put out to for EU tender from June 2019 to March 2020 contained requirements for sustainability.

Authors

Sidsel Marcussen

Attorney

Philip Hesselbjerg

Attorney