INTRODUCTION TO ISO 20500 - Mobile road construction machinery
ISO 20500 is a standard developed by the International Organization for Standardization (ISO) that provides guidelines for the procurement of goods, services, and works. Specifically, it outlines the requirements for sustainable procurement practices.
Here are some of the key requirements outlined in ISO 20500:
a. Integration of sustainability considerations: The standard requires organizations to integrate sustainability considerations into their procurement processes, including social, environmental, and economic factors.
b. Life cycle thinking: Procurement decisions should be made with consideration of the entire lifecycle of the product or service being procured, including its environmental impact.
c. Risk management: Organizations are required to identify and manage risks related to sustainability in their procurement processes.
d. Supplier engagement: Organizations should engage with their suppliers on sustainability issues and encourage them to improve their sustainability practices.
e. Continuous improvement: Procurement processes should be continuously improved, and organizations should monitor and evaluate their sustainability performance.
f. Communication and transparency: Organizations should communicate their sustainability requirements to suppliers and other stakeholders, and provide transparent reporting on their sustainability performance.
By following these requirements, organizations can create more sustainable and socially responsible procurement processes, which can have a positive impact on the environment and society.
Type of ISO 20500
ISO 20500 is a single standard, and there are no different types or versions of this standard. It was published by ISO in 2017, and it is titled "ISO 20500:2017 - Sustainable procurement - Guidance".
ISO 20500 is a guidance standard, which means that it provides recommendations and best practices for organizations to follow, rather than mandatory requirements. Organizations can use ISO 20500 as a framework to develop their own sustainable procurement policies and procedures, and to assess and improve their sustainability performance in procurement.
How many clauses are there for iso 20500, is it same as iso 9001?
ISO 20500 is structured differently than ISO 9001 and does not have the same clause structure. Instead of clauses, ISO 20500 has sections and sub-sections that outline the various elements of sustainable procurement practices.
ISO 20500 has six main sections, each addressing a different aspect of sustainable procurement:
a. Scope
b. Normative references
c. Terms and definitions
d. Principles of sustainable procurement
e. Guidance on implementing sustainable procurement
f. Annexes, which provide additional information and guidance on specific topics
Each of these sections is further divided into sub-sections that provide more detailed guidance on the requirements and best practices for sustainable procurement.
Principles of sustainable procurement
Section 4 of ISO 20500 provides guidance on the principles of sustainable procurement. This section outlines the fundamental principles that organizations should follow when implementing sustainable procurement practices. These principles are:
a. Accountability and transparency: Organizations should be accountable for their procurement decisions and transparent in their communication with suppliers and stakeholders.
b. Ethics and fair dealing: Organizations should conduct procurement in an ethical and fair manner, ensuring that suppliers are treated fairly and equitably.
c. Human rights: Organizations should respect human rights in their procurement practices, including the rights of workers and local communities.
e. Environmental protection: Organizations should consider the environmental impact of their procurement decisions and work to minimize their environmental footprint.
f. Inclusivity and diversity: Organizations should promote inclusivity and diversity in their procurement processes, ensuring that all suppliers have an equal opportunity to participate.
g. Economic development: Organizations should promote economic development through their procurement practices, supporting local businesses and suppliers.
By following these principles, organizations can ensure that their procurement practices are sustainable, socially responsible, and aligned with their values and objectives.
Inclusivity and diversity
Section 4 of ISO 20500 states that organizations should promote inclusivity and diversity in their procurement processes. This means that organizations should strive to provide equal opportunities for all suppliers, regardless of their background, size, or ownership structure.
Here are some ways that organizations can promote inclusivity and diversity in their procurement processes, as recommended by ISO 20500:
a. Remove barriers to participation: Organizations should identify and remove any barriers that may prevent suppliers from participating in their procurement processes. This could include simplifying the bidding process, providing clear guidance on requirements, and ensuring that all suppliers have access to relevant information.
b. Encourage diverse supplier participation: Organizations should actively seek out and encourage participation from suppliers that are owned by underrepresented groups, such as women, minorities, and small and medium-sized enterprises (SMEs). This could include setting diversity targets or establishing programs to support the development of diverse suppliers.
c. Avoid discrimination: Organizations should avoid any discriminatory practices in their procurement processes, including discrimination based on race, gender, religion, or nationality. All suppliers should be evaluated based on their qualifications and ability to meet the requirements of the procurement process.
By promoting inclusivity and diversity in their procurement processes, organizations can create a more level playing field for suppliers, encourage innovation and competition, and contribute to a more equitable and sustainable society.
Implementing Sustainable Procurement practices
Section 5 of ISO 20500 provides guidance on implementing sustainable procurement practices, and item number 5 of this section specifically relates to the engagement of suppliers in sustainable procurement.
ISO 20500 emphasizes the importance of engaging suppliers in sustainable procurement practices, as they play a critical role in the sustainability of the overall supply chain. Item number 5 of Section 5 recommends that organizations should:
a. Communicate their sustainability expectations: Organizations should clearly communicate their sustainability expectations to suppliers, including the social, environmental, and economic factors that they should consider in their operations.
b. Encourage suppliers to improve their sustainability performance: Organizations should work with their suppliers to help them improve their sustainability performance, through training, support, and collaboration.
c. Evaluate suppliers' sustainability performance: Organizations should evaluate their suppliers' sustainability performance, and use this information to inform procurement decisions. This could include assessing suppliers' environmental impact, social responsibility, and ethical practices.
d. Incorporate sustainability criteria into procurement decisions: Organizations should consider sustainability criteria when making procurement decisions, and use this information to select suppliers that are aligned with their sustainability goals.
By engaging suppliers in sustainable procurement practices, organizations can create a more sustainable supply chain, reduce risks, and promote transparency and accountability throughout the procurement process.
Documented procedure required for this iso 20500
ISO 20500 provides guidance on sustainable procurement practices but does not require organizations to develop a specific documented procedure. However, ISO 20500 does recommend that organizations establish a sustainable procurement policy and a framework for implementing sustainable procurement practices.
The sustainable procurement policy should set out the organization's commitment to sustainable procurement, and provide guidance on the principles, objectives, and requirements for sustainable procurement practices. The framework for implementing sustainable procurement practices should outline the procedures, roles, responsibilities, and tools for integrating sustainability into the procurement process.
ISO 20500 provides guidance on the key elements that organizations should include in their sustainable procurement policy and framework, including:
a. Governance: Establishing a governance structure for sustainable procurement, including defining roles and responsibilities, and creating a system for monitoring and reporting on sustainability performance.
b. Stakeholder engagement: Engaging with internal and external stakeholders to identify sustainability risks and opportunities, and to communicate sustainability expectations.
c. Sustainability criteria: Defining sustainability criteria that suppliers should meet, and incorporating these criteria into the procurement process.
d. Supplier engagement: Engaging with suppliers to communicate sustainability expectations, evaluate their sustainability performance, and support their sustainability improvement.
e. Monitoring and reporting: Establishing a system for monitoring and reporting on sustainability performance, including tracking progress, identifying areas for improvement, and communicating results to stakeholders.
While ISO 20500 does not require a specific documented procedure, it does recommend that organizations develop a sustainable procurement policy and framework that aligns with their sustainability goals and objectives. By doing so, organizations can establish a structured approach to sustainable procurement and promote transparency and accountability in their procurement practices.
Example of procurement policy
SUSTAINABLE PROCUREMENT POLICY
Purpose
This policy sets out our commitment to sustainable procurement practices, which are an integral part of our overall sustainability strategy. Our sustainable procurement practices aim to minimize our environmental impact, promote social responsibility, and contribute to the economic development of our suppliers and the communities in which they operate.
Principles
Our sustainable procurement practices are guided by the following principles:
Environmental responsibility: We aim to minimize our environmental impact by selecting products and services that are environmentally responsible, energy-efficient, and resource-efficient.
Social responsibility: We aim to promote social responsibility by selecting suppliers that operate in accordance with ethical business practices, and that respect human rights, diversity, and inclusion.
Economic development: We aim to contribute to the economic development of our suppliers and the communities in which they operate by selecting suppliers that provide fair wages and working conditions, and that support local businesses and economies.
Objectives
Our sustainable procurement practices aim to achieve the following objectives:
To reduce our environmental impact by selecting products and services that are environmentally responsible, energy-efficient, and resource-efficient.
To promote social responsibility by selecting suppliers that operate in accordance with ethical business practices, and that respect human rights, diversity, and inclusion.
To contribute to the economic development of our suppliers and the communities in which they operate by selecting suppliers that provide fair wages and working conditions, and that support local businesses and economies.
Requirements
To achieve our sustainable procurement objectives, we will:
Develop and implement a sustainable procurement framework that integrates sustainability criteria into the procurement process.
Communicate our sustainability expectations to our suppliers, and encourage them to improve their sustainability performance.
Evaluate suppliers' sustainability performance, and use this information to inform procurement decisions.
Incorporate sustainability criteria into procurement decisions, and select suppliers that are aligned with our sustainability goals.
Monitor and report on our sustainability performance, and communicate our results to our stakeholders.
Roles and Responsibilities
Our sustainable procurement practices are the responsibility of all employees, but specific roles and responsibilities are assigned as follows:
The [Sustainability Manager/Procurement Manager] is responsible for overseeing the development and implementation of our sustainable procurement framework.
The [Procurement Team] is responsible for integrating sustainability criteria into the procurement process, and for communicating our sustainability expectations to suppliers.
All employees are responsible for supporting our sustainable procurement practices by selecting environmentally responsible products and services, and by promoting social responsibility in their interactions with suppliers.
Of course, this example policy would need to be customized to the specific needs and goals of the organization, but it provides a good starting point for developing a sustainable procurement policy.
How to implement or to obtain certification of iso 20500
Establish a sustainable procurement policy: Develop a sustainable procurement policy that sets out your organization's commitment to sustainable procurement practices, and the objectives and principles that guide these practices.
Conduct a sustainability assessment: Conduct a sustainability assessment to identify the sustainability risks and opportunities in your procurement process, and to assess your current sustainability performance.
Develop a sustainable procurement framework: Develop a framework for implementing sustainable procurement practices, including procedures, roles and responsibilities, and tools for integrating sustainability into the procurement process.
Engage with stakeholders: Engage with internal and external stakeholders to identify their sustainability expectations, and to communicate your sustainability commitments and initiatives.
Train employees: Train your employees on sustainable procurement practices, including how to integrate sustainability criteria into the procurement process, and how to engage with suppliers on sustainability issues.
Implement sustainable procurement practices: Implement sustainable procurement practices, including incorporating sustainability criteria into procurement decisions, evaluating suppliers' sustainability performance, and monitoring and reporting on sustainability performance.
Monitor and measure performance: Monitor and measure your sustainability performance, including tracking progress, identifying areas for improvement, and communicating results to stakeholders.
Seek ISO 20500 certification: Once you have implemented sustainable procurement practices, you can seek certification to ISO 20500. This involves engaging an accredited certification body to conduct an audit of your sustainable procurement practices and verifying that they meet the requirements of ISO 20500.
Obtaining ISO 20500 certification demonstrates your organization's commitment to sustainable procurement practices and provides assurance to stakeholders that your procurement process is aligned with internationally recognized sustainability standards.
Conducting a sustainability assessment
Conducting a sustainability assessment is an important step in implementing ISO 20500. This involves evaluating your procurement process and supply chain to identify sustainability risks and opportunities, and to assess your current sustainability performance. Here are some more details on how to conduct a sustainability assessment:
Identify sustainability issues: Start by identifying the sustainability issues that are most relevant to your organization and your supply chain. These might include issues such as greenhouse gas emissions, waste management, human rights, labor practices, and diversity and inclusion.
Map your supply chain: Map your supply chain to identify the suppliers and products or services that are most critical to your organization. This will help you to focus your sustainability assessment on the areas of highest impact.
Evaluate sustainability risks and opportunities: Assess the sustainability risks and opportunities in your supply chain by considering factors such as environmental impacts, social impacts, and economic impacts. You can use tools such as sustainability impact assessments or life cycle assessments to help you with this process.
Assess your current sustainability performance: Evaluate your current sustainability performance by measuring and monitoring key sustainability indicators such as greenhouse gas emissions, waste generation, and social and labor standards. Use this information to identify areas for improvement and set sustainability goals and targets.
Engage with suppliers: Engage with your suppliers to understand their sustainability performance and to encourage them to improve their sustainability practices. This might involve conducting supplier assessments, providing training and support, and working collaboratively on sustainability initiatives.
Report on sustainability performance: Communicate your sustainability performance to your stakeholders, including customers, investors, and employees. This demonstrates your commitment to sustainability and provides transparency on your sustainability practices and performance.
By conducting a sustainability assessment, you can identify the sustainability risks and opportunities in your procurement process and supply chain, and develop a roadmap for implementing sustainable procurement practices that are aligned with ISO 20500.
Clauses in ISO 20500
Scope
Normative references
Terms and definitions
Sustainable procurement principles
Integration of sustainability into the procurement process
Procurement organization and management
Supplier selection and evaluation
Contract management
Procurement performance evaluation
Improvement
These clauses provide a framework for organizations to implement sustainable procurement practices that are aligned with internationally recognized sustainability standards.
Detail sub clause from each clauses above
a. Scope
Describes the purpose and scope of the standard and the intended audience.
b. Normative references
Provides a list of other standards and documents that are referenced in ISO 20500.
c. Terms and definitions
Defines key terms used in the standard to ensure consistency and clarity of meaning.
d. Sustainable procurement principles
Outlines the sustainable procurement principles that organizations should adhere to, including accountability, transparency, fairness, and professionalism.
e. Integration of sustainability into the procurement process
Provides guidance on how to integrate sustainability into the procurement process, including how to identify sustainability risks and opportunities, how to develop sustainability criteria for procurement decisions, and how to engage with suppliers on sustainability issues.
f. Procurement organization and management
Outlines the requirements for procurement organization and management, including the roles and responsibilities of procurement personnel, the development of procurement policies and procedures, and the management of procurement risks.
g. Supplier selection and evaluation
Provides guidance on how to select and evaluate suppliers based on sustainability criteria, including how to assess supplier sustainability performance, how to develop supplier sustainability improvement plans, and how to monitor and report on supplier sustainability performance.
h. Contract management
Outlines the requirements for contract management, including how to incorporate sustainability criteria into contracts, how to monitor and enforce sustainability performance clauses in contracts, and how to manage sustainability-related disputes with suppliers.
i. Procurement performance evaluation
Provides guidance on how to evaluate the sustainability performance of the procurement function, including how to develop sustainability performance indicators, how to measure and report on sustainability performance, and how to identify areas for improvement.
j. Improvement
Outlines the requirements for continual improvement of sustainable procurement practices, including how to develop and implement sustainable procurement improvement plans, how to engage with stakeholders on sustainability issues, and how to promote sustainable procurement practices across the organization.
These sub-clauses provide a detailed framework for organizations to implement sustainable procurement practices that are aligned with ISO 20500.
How to evaluate the sustainability risk and opportunity
Evaluating sustainability risks and opportunities involves identifying and assessing the potential impacts of procurement activities on the environment, social well-being, and economic development. Here are some steps that can be taken to evaluate sustainability risks and opportunities:
Identify relevant sustainability issues: Start by identifying the sustainability issues that are relevant to your organization and its procurement activities. This could include environmental impacts such as greenhouse gas emissions, waste generation, and water usage, as well as social issues such as labor practices, human rights, and community impacts.
Assess the potential impacts: Once you have identified the relevant sustainability issues, assess the potential impacts of your procurement activities on these issues. This could involve conducting a sustainability impact assessment or a life cycle assessment of your products or services.
Prioritize risks and opportunities: Prioritize the sustainability risks and opportunities based on their potential impact and likelihood of occurrence. This will help you focus your resources on the most significant sustainability issues.
Develop sustainability criteria: Develop sustainability criteria that reflect the prioritized risks and opportunities. This could involve developing sustainability performance indicators or sustainability standards that suppliers are required to meet.
Incorporate sustainability into the procurement process: Integrate the sustainability criteria into the procurement process, including supplier selection and evaluation, contract management, and performance monitoring.
Engage with suppliers on sustainability issues: Work with suppliers to identify and address sustainability risks and opportunities, including developing sustainability improvement plans and providing support for sustainability initiatives.
By evaluating sustainability risks and opportunities, organizations can develop sustainable procurement practices that are aligned with ISO 20500 and help to promote sustainable development.
Give example of sustainability risk and opprtunities
Examples of sustainability risks and opportunities:
Sustainability Risks:
Climate change: The risk of increased greenhouse gas emissions leading to climate change can impact the availability and quality of natural resources, such as water and food, and cause severe weather events that can disrupt supply chains and infrastructure.
Human rights violations: The risk of suppliers violating human rights in their operations can lead to reputational damage and legal liabilities for the organization, as well as social and environmental impacts on affected communities.
Resource depletion: The risk of resource depletion, such as water scarcity and deforestation, can impact the availability and quality of raw materials and increase costs for the organization.
Sustainability Opportunities:
Energy efficiency: By using energy-efficient products and services, organizations can reduce greenhouse gas emissions and energy costs, while also promoting sustainable development.
Socially responsible sourcing: By sourcing products and services from suppliers that promote fair labor practices and respect human rights, organizations can enhance their reputation and contribute to sustainable development.
Circular economy: By adopting circular economy principles, such as reducing waste, reusing materials, and recycling, organizations can reduce their environmental footprint and promote sustainable development.
By identifying and addressing sustainability risks and opportunities, organizations can develop sustainable procurement practices that are aligned with ISO 20500 and help to promote sustainable development.
What is sustainability criteria
Sustainability criteria are a set of standards and requirements that organizations use to evaluate the sustainability performance of their suppliers or products. These criteria are typically based on the sustainability risks and opportunities identified during the sustainability risk assessment process. Examples of sustainability criteria might include:
Environmental criteria: This might include requirements for suppliers to reduce their greenhouse gas emissions, improve their energy efficiency, use renewable energy sources, reduce waste generation, and minimize their use of hazardous materials.
Social criteria: This might include requirements for suppliers to respect human rights, promote fair labor practices, provide safe working conditions, and support the communities where they operate.
Economic criteria: This might include requirements for suppliers to promote sustainable economic development, support local businesses and industries, and demonstrate transparency and accountability in their financial practices.
Sustainability criteria are often used to develop sustainability performance indicators or sustainability standards that suppliers are required to meet. Organizations may also use sustainability criteria to evaluate their own sustainability performance, as well as to communicate their sustainability goals and achievements to stakeholders. By using sustainability criteria, organizations can promote sustainable procurement practices that are aligned with ISO 20500 and help to promote sustainable development.
