HOW CAN THE UNITED KINGDOM CONSTRUCTION

INDUSTRY IMPLEMENT SUSTAINABLE

PROCUREMENT STRATEGIES?
Darryl Iles1 and Paul Ryall

Faculty of Computing, Engineering & Science, University of South Wales, Treforest, Pontypridd, CF37
1DL, Wales.

The aim of this study was to examine the implementation of sustainable procurement
within the United Kingdom construction industry. The research identified not only a
range of benefits from the implementation of sustainable procurement strategies but
also barriers. The research extended a previous scoping study and employed a cross-
sectional study utilising semi-structured interviews to test the initial findings
generated by the literature review, involving interviews representing a cross section of
the United Kingdom construction industry. Barriers to implementation include cost,
inertia and lack of knowledge, amongst others. Whilst the findings from the research
suggest that there are a number of barriers to implementation, companies should
embrace sustainable procurement and embed strategies within the organisations to
achieve maximum benefits and cost savings. Those engaging in sustainable
procurement strategies identified the most benefits and did not see cost as a barrier.
The impact of these cost savings should be communicated more widely in the United
Kingdom construction industry to quell the myth that implementation of sustainable
procurement is expensive. Further collaboration would increase participation from
those within an often fragmented and adversarial United Kingdom construction
industry with a lack of knowledge and resistance to change. The Government should
continue to encourage the supply chain to act sustainably and continue to improve
awareness of sustainable procurement strategies through the provision of additional
information and development of guidance. Having said that, there is much in terms of
policy and principles of sustainable procurement but the implementation of these is
unclear and contributes to the fragmentation and adversarial nature of the United
Kingdom construction industry.

Keywords: corporate strategy, procurement, supply chain, sustainability.

INTRODUCTION
Sustainable procurement is defined by the UK Government in The National
Sustainable Procurement Action Plan ‘Procuring the Future’ as “a process whereby
organisations meet their needs for goods, services, works and utilities in a way that
achieves value for money on a whole life basis in terms of generating benefits not
only to the organisation, but also to society and the economy whilst minimising
damage to the environment” (DEFRA, 2005). It is widely considered that sustainable
procurement is becoming more significant in a construction industry that is recovering
from an economic downturn. CIOB (2010) identify that sustainability is now
incorporated in construction projects of all size, type and value. Whilst the

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darryl.iles@southwales.ac.uk

Iles, D and Ryall, P (2016) How Can The United Kingdom Construction Industry Implement
Sustainable Procurement Strategies?. In: P W Chan and C J Neilson (Eds.) Proceedings of the 32nd
Annual ARCOM Conference, 5-7 September 2016, Manchester, UK, Association of Researchers in
Construction Management, Vol 2, 1121-1130.
Iles and Ryall

Government is using its purchasing power to encourage implementation within the

United Kingdom construction industry supply chain (RIBA 2012).
The implementation of sustainable procurement is of value to the United Kingdom
construction industry, not only to address requirements under ISO26000 and BS8903
but to satisfy supply chain policies. It is widely recognised that there are many
barriers to implementation, this results in the questioning: why should the United
Kingdom adopt the implementation of sustainable procurement.
LITERATURE REVIEW
Sustainable Procurement
Sustainable procurement is defined by the British Standards Institute (BSI, 2010) as
"purchasing goods and items or services whose production, use and disposal minimize
negative impacts and encourage positive outcomes for the environment, economy and
society". Sustainable procurement delivers the main objective of sustainable
development through the consideration of social issues, community benefits and
Targeted Recruitment and Training (Welsh Housing Quarterly, 2012)
It is a method of delivering goods or services whilst considering broader issues such
as the socio economic impact. The Department for Environment, Food and Rural
Affairs (DEFRA) support the notion that sustainable procurement helps ensure value
for money and lower operational costs whilst protecting the environment and bringing
us wider societal benefits.
The Government, as a major construction client, has an important role in driving the
sustainability agenda (CIPS 2015, OGC 2004, Levene 1995). Following the 2012
London Olympics, DEFRA issued a guidance document for those involved with
procurement of construction projects. Lord de Mauley (DEFRA, 2013a) boasts how
London 2012 showed how sustainable procurement could be done practically and
efficiently, lessons learned should be captured and taken on board by others.
The Government and therefore those within the supply chain engaged in public sector
contracts are in a strong position to influence the United Kingdom construction
industry supply chain to act sustainably. Government spending is “approximately
16% of the UK’s GDP (DEFRA, 2013b), central government alone buys the
equivalent of 9%”. The introduction of various forms of legislation, policies and
procedures on a macro level is not intended to be a barrier but a method to encourage
wider implementation in the United Kingdom construction industry (Figure 1)

Figure 1: Key United Kingdom construction industry and Government reports

The International Standard for sustainable procurement ISO26000 and the British
standard BS8903 are considered to be the globally recognised standards (Action
Sustainability 2012, BSI 2010 and BSI 2015). They offer guidance for organisations
to consider and implement sustainable practices within their procurement process.
ISO26000 not only deals with the fundamentals of sustainable procurement but

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explores the concept of complicity and the question of “Why procure sustainably?”
which makes it more familiar to BS 8903 users. (McCarthy, 2015)
The United Kingdom construction industry
The United Kingdom construction industry represents a wide range of companies in
various guises and sectors. Although there are a number of barriers to implementation
within the literature, the homogeneity of the definition of United Kingdom
construction industry is challenged and therefore the application of any conclusions or
recommendations from the limited published data to the United Kingdom construction
industry as a whole. The United Kingdom construction industry is diverse,
fragmented and without definable boundaries and characteristic problems (Cox and
Ireland, 2002, Berry and McCarthy, 2011, Groák 1994). Projects differ substantially
from one another and significant discontinuities in flows of personnel, materials and
information are created, such discontinuities are added to by the fragmentation of the
project team and professional disciplines (Bresnen et al.,. 2003)
Collaborative working across these classifications is subsumed under the term
partnering and is increasing in the United Kingdom construction industry. Partnering
is not only a matter of learning new knowledge and adjusting existing working
processes, it also requires discarding old routines and behaviour and overcoming
vicious circles of reinforcing perceptions (Hartmann and Bresnen,2011).
Collaborative working would suggest a common approach to sustainable procurement
and its implementation within the supply chain, however, due to the fragmentation of
the industry and the various barriers to implementation that exist (Constructing
Excellence, 2008) this is often not the case.
Pearce (2003) recognises that when well designed, the built environment generates
significant but, as yet, largely unquantified benefits in terms of human wellbeing -
therefore recognising the importance of not only economic factors but the social value
of construction and therefore the significance of sustainable procurement in the United
Kingdom construction industry.
The implementation of Sustainable Procurement
Beyond the requirements of British or International standards, sustainable
procurement offers many benefits for an organisation. These are summarised under 5
key business categories within BS8903 and include: Financial drivers, Risk,
Organisational policy, Stakeholder expectations and awareness and Marketing.
Barriers to implementation have been highlighted by Constructing Excellence (2008)
and reaffirmed in more recent research (Hemmingsen, 2013).
Cost is perceived as a major barrier for the implementation of sustainable procurement
by the majority. Unless cost savings can be achieved, products will not be adopted
and sustainability would only be considered if it was a specific requirement from
clients or planners (Constructing Excellence, 2008). However this is actively debated
in the industry, some believe that sustainable procurement actually reduces the cost of
construction (CIPS 2011, Dobson et al., 2013).
This debate has contributed to increased media attention surrounding sustainable
procurement, heightened by the introduction of ISO 20400 and the construction of
large scale public contracts including the 2012 London Olympics. As a result, clients
and contractors have committed to strive for sustainable projects with green
credentials and have implemented sustainable procurement strategies in order to
achieve this.

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Table 1: Barriers to implementation

Barrier Cited By respondents
Cost 93%
Lack of knowledge 53%
Availability of products 33%
Inertia/reluctance to change/tradition/fear of the unknown 33%
Conflict between legislation/planning and environmental protection 33%
Poor regulation/accreditation of products 33%
(Constructing Excellence, 2008)
Despite this commitment, a lack of knowledge is still considered as a barrier to
implementation. Whilst there is a strong desire to make progress, many organisations
don’t have the tools or knowledge to move forward. This is attributed to reluctance to
change, strong traditions and fear of the unknown and smaller enterprises needing
stronger guidance and extra assistance in adopting sustainable procurement practices
(Constructing Excellence, 2008). It is the smaller contractors and subcontractors in
the United Kingdom construction industry who experience the most barriers to
implementation (Morgan, 2013). The responsible sourcing of both labour and
materials is seen as a great burden (Sedex 2015, McGoldrick 2013). A draft Global
framework standard - BES 6001, has been issued by the BRE (2013) for the
responsible sourcing of construction products to provide clarity on the subject.
However, concern surrounding the way in which “local” is defined has been raised by
McCarthy (2013).
Private-sector house builders and large organisations like the NHS require the use of
locally-sourced supplies to reduce their carbon footprint. (Blighty, 2013) Shifting
suppliers to one who is able to provide responsibly sourced materials affect those who
rely on agreed fixed rates. Some may be forced to resort to uncertified products to
meet deadlines or ‘cut corners’ (Constructing Excellence, 2008) Larger contractors
such as Skanska (2011) are shifting the burden of procurement to their supply chain,
expecting others to adapt their business practices and only doing business with those
who are recognised as responsible suppliers and subcontractors. They require
stringent levels of targeted recruitment and training, whilst sustainable labour sourcing
through targeted recruitment and training schemes is commonly supported (RIBA
2012) it is a burden for many in the United Kingdom construction industry. Targeted
recruitment and training represents an additional cost, not only in recruitment but
training and development. Although a local, more educated workforce is beneficial,
costs can be high and cash flow is restricted (McGoldrick 2013, Urquhart 2013).
RESEARCH APPROACH
The aim of this research was to further investigate the opportunities and barriers
identified in the literature review in regards to the adoption of sustainable procurement
in construction. The chosen methodological approach was a cross-sectional study.
The research was concerned with understanding how sustainable procurement could
be utilised in the future, including any barriers or limitations in its implementation and
operation. The nature of cross-sectional studies is to collect primary data from a
purposefully selected range of respondents.
The decision to utilise interviews was validated by the initial communications with
potential respondents. Interviews offered a subjective and more accurate method of

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data collection for a topic which is attitudinal based rather than numerical. The
interaction within the interview process allows for the collection of detailed
qualitative data that explores individuals’ perspective and opinions. Table 2 illustrates
the chosen interview sample.
Semi-structured interviews were preferred to enable the respondents to answer the
questions in as much depth as possible. The interview questions were articulated from
the provisional findings of the literature review and were collated in themes, the first
questions allowed an informative data collection of individual and company details
including experience of the topic. This was followed by more detailed questioning on
the existence of any barriers or advantages when implementing sustainable
procurement. The collection and analysis of data in the transcribed interviews
allowed the establishment and confirmation of research themes which were then cross
referenced, evaluated and results articulated. The coding of individual responses
allowed for the collective evaluation of data within the key priori of advantages and
disadvantages of implementation within the United Kingdom construction industry,
addressing the findings of the literature.
Table 2: Profile of Interview Respondents
Respondent Sample Turnover Number of Employees
A Client £5.8 billion 6,390
B Contractor (General Construction) £1.9 million 200
C Contractor (Civil Engineer) £4 billion 15,300
D Manufacturer and Supplier £334.1 million 2,132
(United Kingdom construction
industry)
E Supplier (to UK House Builder) £1million 120

RESULTS
Interviewees profile
All five interviewees had extensive experience working within the United Kingdom
construction industry and had knowledge of commercial procurement strategies. At
the time of the research, the interviewees were employees of different companies,
within different sectors in the industry; contractor, client and supplier/manufacturer.
Their roles ranged from site based engineers, cost consultants to head of sustainability
and directors. This provided a variety of perspectives and a representative, albeit
restrictive, cross section of the United Kingdom construction industry. Future
research should include the synthesis of primary data from a larger sample of similarly
experienced sources to provide more detailed and extensive primary data.
Implementation of Sustainable Procurement
40% of respondents did not have a formal policy that needed to be adhered to but
outlined ways in which the company implements sustainable procurement strategies,
demonstrating a knowledge of the topic.
Methods of sustainable procurement were identified by all, the most common being
the responsible sourcing of goods and materials in order to improve corporate image.
This was mainly implemented through the use of a local supply chain, purchasing
sustainable materials and working within the community. 60% of the interviewees

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demonstrated a commitment to additional methods including waste management

plans, the monitoring and reduction of emissions and a dedicated intranet service to
sustainability.
All interviewees referred to cost implications without prompt, this subconscious
awareness of cost as a barrier to implementation was further probed, identifying a
difference of opinion reflective of those of Constructing Excellence (2008) and CIPS
(2011) and Dobson et al., (2013). A stated that the implementation of sustainable
procurement strategies was wholly dependent on the cost to the company, in
comparison, D stated that their approach was to buy goods and services based on the
best value and not cheapest price.
We have a sustainable procurement policy which is about buying best value not
cheapest price and understanding responsible sourcing throughout the supply chain.
A difference in attitude was identified according to the respondents' company and
their role in the supply chain. A confirmed a difference in approach as their company
switched roles between client and contractor, as a client they did not place any
requirements on others, but when employed as a contractor they passed the
requirements for sustainability through the supply chain. When questioned on the
morality and necessity of this it became apparent that sustainability is perceived as a
burden, sentiments articulated in Constructing Excellence (2008) and McGoldrick
(2013). By contrast, 60% of interviewees felt that sustainability was and should be
embedded into the corporate values of the company by choice and not necessity.
Sustainability is about reducing your impact on the environment, it makes good
business sense to reduce the impact on the environment and society and improve
corporate responsibility and image.
The requirement to act sustainably is found to be driven mainly from public sector
employers, whereas private sector clients, such as a UK house builder, did not demand
any sustainability credentials. It was identified that the respondents representing the
contractors and clients in the industry are often able to pass the requirements of
sustainable procurement through the supply chain and alleviate the burden, perceived
or otherwise, reflecting the experiences of Skanska (2011)
Benefits of implementation
Despite a perception of cost being a barrier to implementation, cost savings were cited
as an advantage of implementation by 40% of interviewees. The use of a local supply
chain resulted in more competitive prices, savings which were increased further
through a reduction in programme. It is often the case that the actual cost of
implementation is lower than the perceived cost and the cost is negligible in relation to
turnover, between 0-3% (Morgan, 2013). It was the companies not engaged with
implementation who perceived cost to be a major barrier, furthermore, these
companies also cited the most barriers to implementation. The respondents
representing companies that embed sustainable procurement policies throughout the
business did not consider sustainability as a separate cost centre and provided
evidence that the actual costs of implementation are minimal.
Most interviewees agreed that sustainable procurement improved the corporate image
of a company and led to a competitive advantage when tendering, D also believed that
sustainability was able to provide a good return for the business as it provided clear
focus and corporate transparency.

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I’ve also known a reduction in programme time too as the lead time on locally sourced
materials is less than those that would be shipped globally or nationally
Those who were not regulated to incorporate sustainable procurement held an
awareness of the issue and identified a stakeholder expectation to incorporate and
embed sustainability within the ethos of the company.
Barriers to implementation
A local supply chain may not always provide the best option as they may not have the
financial capabilities or the necessary resources available to them. This was
recognised to have a detrimental impact on corporate relationships and contribute to
the adversarial and fragmented image of the United Kingdom construction industry
(Cox and Ireland, 2002, Berry and McCarthy, 2011, Groák 1994).
Cost was perceived to be a disadvantage by 40% of respondents, however as discussed
previously the validity of this view is questionable; the respondents citing cost as a
barrier represented companies not engaging with sustainable procurement, reinforcing
the view of Constructing Excellence (2008) who cited inertia or lack of knowledge as
a barrier.
Attitudes towards approach
All respondents recognised a moral obligation to implement sustainable procurement.
Some recognised that they do this as part of their corporate social responsibility
targets and the positive impact on their reputation, or because it makes business sense.
DISCUSSION
A definition has been provided for sustainable procurement and a number of issues
have been outlined in BS8903 that should be considered by an organisation. The
Government as a major construction client have undertaken research to establish best
practice and use their purchasing power to influence the supply chain. Having said
this, the United Kingdom construction industry is often fragmented (Bresnen et al.,
2003) and those working within the industry are often reluctant to react to change.
The definition of United Kingdom construction industry is homogeneous and any
inferences from the data cannot necessary apply to the entire industry. Similarly, the
interview sample is restrictive and primary data obtained only provides a small view
into the large and varied industry.
Barriers to implementation exist and are a cause for concern for the industry. These
include cost, inertia and a lack of knowledge. Evidence has been provided within the
primary data that demonstrates there is an awareness of sustainable procurement
within the United Kingdom construction industry and also a stakeholder expectation
to incorporate sustainability within the ethos of the company.
Beyond meeting legislative requirements, sustainable procurement offers many
benefits for an organisation, summarised within ISO20400 and BS8903 and supported
by both the secondary data in the literature and by interview respondents. Sustainable
procurement can lead to a derivation of a more positive image, not solely to contribute
to any corporate social responsibility targets, but more so acting on a moral obligation.
Contractors such as Skanska (2011) are able to shift the burden of procurement to
their supply chain and where the supply chain fails to meet any requirements imposed
on them, there is a negative impact on working relationships. This can occur where
the engagement of a local supply chain is not practical, if they do not have the
financial capabilities or the appropriate resources available to them. Nevertheless, a

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local supply chain offered some the opportunity to maximise cost savings due to more
competitive pricing and reduction in programme duration.
It is apparent that there is a driving force to implement sustainability within the United
Kingdom construction industry, largely from the public sector and driven by the
Government (Bresnen. et al., 2003). However some private sector clients, such as a
UK house builder, do not express many, if any sustainable procurement requirements.
Regardless of pressure from within the supply chain to implement sustainable
procurement strategies, there is evidence that the majority of organisations are
embracing sustainability. Those who have implemented strategies believe that the
benefits outweigh any barriers.
CONCLUSIONS
Although it has been demonstrated that there is much in terms of policy and procedure
apparent through industry (Skanska, 2011) and guidance standards such as ISO20400
and BS8903, the standardisation of implementation throughout the industry is not
apparent. There is a vast difference in attitudes and this is reflected in the adoption
and implementation of sustainable procurement throughout the United Kingdom
construction industry. The concept of complicity and the question of “Why procure
sustainably?” exists for many (McCarthy, 2015) and is reflected by non-adoption of
sustainable procurement within companies. This attributes to an undesirable
perception that there are many barriers to implementation, the most significant being
cost (Constructing Excellence, 2008) although when examined, actual costs incurred
are insignificant (Morgan, 2013). It was surprising to find that the barriers cited by
Constructing Excellence (2008) were mirrored in research by the authors but found to
be supported exclusively by those who do not engage with sustainable procurement.
Based on this sample, barriers were unfounded and spread a negativity within the
industry. It is recognised that a collaborative and uninhibited drive to dispel inertia
and improve a lack of knowledge may create a more cohesive and standardised
approach to implementation.
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