Purchasing for People

and the Planet

Lisa Mastny

State of the World 2004

 Purchasing for People
and the Planet
Overview:
1. Greening Institutional Procurement
2. Pioneers in Green Purchasing
3. Pressures and Drivers
4. Overcoming Obstacles
5. Identifying Green Products
6. Spreading the Movement
 Purchasing for People
and the Planet
• Nearly every purchase an organization makes
has hidden costs for the environment and for
the world’s people

• Many products
- require huge inputs of water,
wood, energy, metals, and
other resources that are not
always renewable
- contain toxic chemicals that
endanger our health
 Greening Institutional
Procurement

• When purchasing is highly centralized, as in

large institutions, a single decision made by
one or a handful of buyers can influence the
products used by hundreds or even
thousands of individuals
• The buying activities of institutional
purchasers have far greater consequences
for the planet than the daily choices of most
household consumers
 Greening Institutional
Procurement

By incorporating
environmental concerns into
all stages of their
procurements, institutions
can use their significant
purchasing power to be
powerful agents for
environmental change
 Greening Institutional
Procurement
• Governments spend billions of dollars on purchases of
everything from office supplies to vehicles
Government Spending as Share of GDP
in Selected Countries, 1998
Denmark
Denmark 25%
Canada
Canada 20%
Germany
Germany 19%
Italy
Italy 17%
Switzerland
Switzerland 15%
United States
United States 14%
Netherlands
Netherlands 13%
Japan
Japan 10%

0 5 10 15 20 25 30
Source: OECD Percent
 Greening Institutional
Procurement

• Other large institutions also have

significant purchasing power
– corporations
– universities
– religious institutions
– international institutions such as
the United Nations and World Bank

• They all require vast amounts of

goods and services to run their
operations
 Greening Institutional
Procurement

Rising institutional demand can play a key role in

building larger markets for greener goods and
services, making environmentally preferable
purchases more affordable for everyone
 Greening Institutional
Procurement

• Institutions can make use of their systematic

approach to purchasing
• In addition to requirements for quantity, price,
function, or safety in purchasing contracts with
suppliers, institutional buyers can also
establish environmental criteria
– recycled content
– energy efficiency
– less packaging
– use of sustainably managed resources
 Pioneers in Green
Purchasing

• Several advantages to green purchasing at the

corporate level

– improved profitability from

increased water and energy
efficiency, waste reduction
– healthier and safer work
environments (fewer toxic
chemicals from cleaning agents,
paints, pesticides, etc.)
– better public image
Examples of Green Purchasing
in Selected Companies
Starbucks
- since 2001, has given supplier
preference to coffee farmers who
meet certain environmental and
social standards; in 2002, 28% of
paper fiber used was post-consumer
and 49% contained unbleached fiber

Federal Express
- in 2004, introduced hybrid electric
vehicles into its delivery fleet; the
FedEx OptiFleet E700 will decrease
particulate emissions by 96% and
reduce smog-causing emissions by
65%
Examples of Green Purchasing
in Selected Companies
Canon

- gives priority in its global

purchasing to nearly 4,600
company-approved green office
supplies

IKEA

- gives preference to wood from

forests that are either certified as
being sustainably managed or in
transition to these standards
 Pioneers in Green
Purchasing
• Several countries have strict national laws or
policies requiring government agencies to buy
green

- Austria
- Canada
- Denmark
- Germany
- Japan
- United Kingdom
- United States
 Pioneers in Green
Purchasing
Government green purchasing can be
particularly effective in pushing markets
where public buying accounts for a
significant share of overall demand
(e.g., computer equipment)
 Pioneers in Green
Purchasing
• U.S. government is the world’s single largest
computer purchaser (1 million machines
annually)
• In 1993, federal agencies were required to buy
only computer equipment that met efficiency
requirements of Energy Star program
• Today, largely due to this increased demand,
Energy Star standards are now met by
- 95% of all monitors
- 80% of all computers
- 99% of printers
sold in North America
 Pressures and Drivers:
Governments
Governments can exert pressure to promote
green purchasing with
• rebates, tax breaks, and other economic
incentives to encourage consumers to buy green
• laws and regulations (for energy efficiency,
recyclability, waste disposal, etc.) to influence
the way manufacturers design and make their
products
 Pressures and Drivers:
Individual Consumers
• Many consumers chose to buy green at the
household level
• About 63 million U.S. adults (30% of
households in the country) do some form of
environmentally or socially conscious
buying
• Concerned individuals are participating in
boycotts and other direct actions to pressure
companies into shifting their buying practices
– many feel this is a more effective tool for
change than lobbying for regulatory action,
which could take years
 Pressures and Drivers:
Individual Consumers
• In the mid-1990s, Rainforest Action Network
launched a campaign to pressure Home
Depot, the world’s largest home improvement
retailer, to change its buying practices
• In 1999, the company announced they would
phase out endangered wood products and
favor products certified as coming from
sustainably managed forests
• Ripple effect: these policy shifts have raised
the overall standard for the timber industry
 Overcoming Obstacles

• Green purchasing initiatives must overcome

several barriers
– complex legal framework surrounding
procurement
– weak enforcement
– political challenges
– finding affordable product alternatives
– convincing employees to recognize the benefits
of adopting more environmentally sound
practices
 Overcoming Obstacles

• Tools to help green purchasing:

– establishing an explicit written policy or law
– setting strict targets
– implementing a system of accountability
– monitoring and recording activity
 Identifying Green
Products
• An additional challenge lies in identifying
green products
• To make sound decisions, there is a need to
evaluate the environmental performance of
products
• Several tools are being developed to help both
manufacturers and consumers
 Identifying Green
Products
Life Cycle Assessment
- methodology for identifying and quantifying the
inputs, outputs, and potential environmental
impacts of a given product or service throughout
its lifecycle (from raw materials to disposal)

Ecolabels
- seals of approval used to indicate that a product
has met specified criteria for environmental
soundness during one or more stages of its
lifecycle
 Spreading the Movement

• A number of organizations and networks are

spreading the movement by
– publishing information on green purchasing
– collecting success stories
– publicizing trends
– partnering directly with industry leaders and
government officials
– rallying the grassroots to boycott or otherwise
pressure manufacturers
– promoting public debate and generating
media interest
 Spreading the Movement
International Council for Local Environmental
Initiatives
- members of the European group’s
Buy-It-Green network exchange
information and experiences, join
forces, and make joint green
purchases
www.iclei.org
U.S. EPA
- Environmentally Preferable
Purchasing program offers support an
information in such areas as
construction, office products, cleaning
products, cafeteria procurement,
and electronics
www.epa.gov
 Spreading the Movement
Center for a New American Dream

- helps institutions incorporate

environmental considerations
into their purchasing
decisions
www.newdream.org
Japan’s Green Purchasing Network

- holds countrywide seminars

and exhibitions on green
purchasing, and publishes
purchasing guidelines and
environmental data books,
www.gpn.jp
 Spreading the Movement
International Hotels Environment Initiative

- sponsors a web-based tool to

help hotels improve their
environmental performance

www.ihei.org
Talloires Plan
- 10-point action plan that
encourages universities to
establish policies and practices of
resource conservation, recycling,
waste reduction, etc.
 Spreading the Movement

• Must also boost green

purchases in the developing
world
• By doing so, international
organizations stimulate local
green markets, and clean
up their own acts in the face
of mounting criticism about
the environmental impacts of
their activities
 Spreading the Movement

• Green purchasing is not the only way to minimize

the problems associated with excessive
consumption
• Institutions will also need to find ways to meet their
needs without buying new products, such as
- eliminating unnecessary purchases
- extending the lives of existing products
- diverting used goods from being sent to landfills
 Spreading the Movement

• Green purchasing is an important step to

achieving a more sustainable world
• As individuals, we need to pressure the
organizations we work for, and rely on, to join
us in building such a world
 About the Author

Lisa Mastny is a Senior Editor

at the Worldwatch Institute
 More information on
State of the World 2004
at www.worldwatch.org