Last week I commented on Courtenay Mayor Larry Jangula’s attack on the idea of social procurement and especially on the reputations of those who, acting on council’s request, had come to Council to provide information on Social Procurement in the context of municipal policy. I ended the post promising to, this week, look at what exactly is this Social Procurement idea that seems to so agitate the bowels of Courtenay’s mayor.
It’s interesting that for all the work the mayor put into researching attack points on the reputations of the presenters to council, he seems to have made no such effort to try to understand the idea of Social Procurement and its place in municipal policy. If only for entertainment value it is worth going to the City of Courtenay website to see the May 30 video of the Mayor throwing his hands in the air, shaking his head and declaring in utter bafflement, “This is all clear as mud to me.”
Despite the Mayor’s all-too-willing misunderstanding, there are very good reasons for municipalities to learn about social procurement; not the least of which is the billions in stimulus spending about to flow to municipalities from the federal government coupled with Prime Minister Trudeau’s specific inclusion of Social Procurement in his mandate letter to Federal Procurement Minister Foote, communicating the need to modernize Public Sector Procurement and signaling “a new era for the advancement for Social Innovation and Social Procurement across Canada.”
Ironically, one of the best sources of information on the meaning, value and implementation of municipal Social Procurement policy is on the Village of Cumberland website https://cumberland.ca/social-procurement/. It’s all on the Cumberland site: the purpose, the process and the desired–monitored—outcomes.
I am quite intrigued by the tag line Cumberland created to encapsulate their new—August 2015—social procurement policies: Moving from do no harm, to do some good. The moving from do no harm part references the beginnings of Social Procurement that was mostly about corporations adding clauses to purchase agreements that protected them from devastating reputation losses (and accompanying customer loss) when their suppliers do things like lock ill-paid workers in a factory that burns down or collapses. So the supply contracts began adding wording like ‘the supplier will ensure the health and safety of workers on the job.’ It wasn’t a big thing but it was a beginning. Interestingly Mayor Jangula seemed utterly baffled by the idea that the private sector would have anything to do with social procurement though that is clearly where the idea began. Over time social procurement wording began to incorporate other goals that required more than simply the cheapest price. Things like ensuring that a production plant did not dump community poisoning toxic chemicals into the water or hold children as slave labour became incorporated in evolving Social Procurement contracts.
Then came a major break through as corporations began to consider the “do some good” part of the equation. If social procurement could be used to avoid harm to a corporate reputation, it seemed a small leap to ask how social procurement could be used to add value to the corporate reputation. We don’t have space here to go into the value of corporate reputation but just think about how much advertising you see goes into creating a favorable corporate image as opposed to how much advertising actually describes the utility of its products. So contracts to supply clothing might have a clause that the successful bidder pays a minimum wage or hires employees that are as diverse as the community around the factory or even hires and trains a percentage of otherwise disadvantaged people.
Eventually the idea that purchasing contracts could be an important part of building safer, healthier, more equitable communities made the big jump to municipal planning. Given the immense purchasing block that municipalities represent, it became clear that municipal purchasing of services and products could be used to advance other municipal economic/social development, and environmental goals. In 1999 the city of Santa Monica, California jumped to the lead in social procurement by initiating a green purchasing policy that has leveraged the city into the centre for green energy and sustainability business development.
Recognizing that the City of Toronto already had a long history of using its procurement to achieve strategic social development goal, in 2012 Toronto (Toronto!) set out to formalize its commitment to a procurement culture of policies and practices that promote and contribute to” a fairer, more ethical, and more sustainable city.”
Not to be outdone by its eastern rival, Vancouver—very shortly afterward–adopted a procurement policy that embedded sustainability and ethical (SE) considerations into a procurement policy that requires major purchases to have “have positive environmental and social attributes,” i.e., provide safe and healthy workplaces for the people who make products for the city, respect human and civil rights, align with the City’s mission and values.
This year Cumberland led Vancouver Island municipalities by adopting a Social Procurement policy that is designed to:
- Contribute to a stronger local economy;
- increase diversity among suppliers;
- promote the Living Wage and fair employment practices;
- improve access to contracts for micro, small business and social enterprises;
- increase the number of local jobs that support young working families;
- increase social inclusion, by improving contract access for equity-seeking groups, such as social enterprises;
- enhance community arts and culture infrastructure;
- improve and enhance public spaces;
- increase training and apprenticeship opportunities;
- help move people out of poverty, providing increased independence and sustainable employment for those in need;
- improve opportunities for meaningful independence and community inclusion for citizens living with disabilities; and
- to stimulate an entrepreneurial culture of social innovation
It is, of course, not possible to leave off a discussion of social procurement without mentioning the giant in the room. In 2008 The Canadian Investment Awards which is dedicated to recognizing long-term excellence and leadership in the Financial Services industry, awarded VanCity Credit Union the inaugural winner of the “Green Company Award for Environmental Leadership.” Whether it is quality of work environment, member satisfaction, social justice or sustainability Vancity always leads the pack. Accepting the award Vancity CEO Tamara Vrooman stated, “Sustainability is core to our values and shapes the way we do business… our green initiatives differentiate us in the marketplace and gives our members a reason to choose Vancity beyond the competitive products and services we offer. In short, being green is good business…everything we do reflects our guiding principles of a flourishing co-operative economy, social justice and financial inclusion, and environmental sustainability. “
Businesses, governments at all levels, universities, the Olympic Organizing Committee, agencies like BC Hydro, have all turned to social procurement to leverage market decisions for the benefit of their bottom line as well as an opportunity to leverage market decisions for social benefit. Interestingly the world’s leader in social procurement is clearly the UK, where they have passed the Social Value Procurement Act directing government agencies to include social value components in all major purchasing. It is, for one thing, seen as a way of leveraging market decisions for social benefits and, thus, not having to depend on tax-payer dollars to accomplish the same goals.
Seems a perfectly clear and wonderful idea to me. Indeed, I am baffled to try to understand what it is about social procurement that so clouds the understanding and ruffles the feathers of the mayor of Courtenay.