Green Public Procurement: Catalysing the Net-Zero EconomyWHITE PAPERJANUARY 2022In collaboration with the Boston Consulting Group ContentsForewordExecutive summary1 Introduction2 The green opportunity3 Facing the challenges4 Ten steps to greener public procurement4.1 Steps 1 and 2: Create transparency in baselines and targets4.2 Steps 3 and 4: Optimize products for greenhouse gas abatement across their life cycle4.3 Steps 5 and 6: Define product and supplier standards and work with suppliers4.4 Steps 7 and 8: Develop the wider ecosystem and create buying groups4.5 Steps 9 and 10: Transform the procurement organization and align across agenciesConclusionContributorsAcknowledgementsEndnotes3467111415 20 22 24 25 28293031Images: Getty Images© 2022 World Economic Forum. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, including photocopying and recording, or by any information storage and retrieval system.Disclaimer This document is published by the World Economic Forum as a contribution to a project, insight area or interaction. The findings, interpretations and conclusions expressed herein are a result of a collaborative process facilitated and endorsed by the World Economic Forum but whose results do not necessarily represent the views of the World Economic Forum, nor the entirety of its Members, Partners or other stakeholders.Green Public Procurement: Catalysing the Net-Zero Economy2 ForewordIf we are to limit global average temperature increases to 1.5°C, we must reduce carbon dioxide equivalent (CO2e) emissions by 45% by 2030 and reach net zero by 2050.1 This will require drastic transformations in how we produce and use energy and other resources. Governments, as major consumers, can and must do their part. Last year’s report, Net-Zero Challenge: The Supply Chain Opportunity,2 by the World Economic Forum and the Boston Consulting Group, highlighted how companies can multiply their climate impact by decarbonizing their supply chains. This report examines the role of governments as consumers in the global effort to combat climate change: why their contribution is critical and how they can reduce their carbon footprint across their operations and supply chains. The 26th UN Conference of the Parties (COP26), which took place in November 2021, generated considerable momentum, with many national governments and major cities pledging to make their procurement processes greener. The governments of the United Kingdom, India, Germany, the United Arab Emirates and Canada, under the new Industrial Deep Decarbonization Initiative (IDDI), all announced intentions to buy low-carbon steel and concrete.3We must build upon this momentum to ensure that more governments use their purchasing power to buy low-carbon goods and services, making sure that their own actions contribute towards setting us on a path to a net-zero world.Joerg Hildebrandt Managing Director and Senior Partner, Boston Consulting GroupBørge Brende President, World Economic ForumStephan Sicars Managing Director, Directorate of Environment and Energy, United Nations Industrial Development Organization (UNIDO)Green Public Procurement: Catalysing the Net-Zero EconomyJanuary 2022Green Public Procurement: Catalysing the Net-Zero Economy3 The opportunityExecutive summaryA systematic framework will enable procurement officials to overcome the challenges of setting and reaching net-zero goals.The procurement activities of national, state and local governments are directly or indirectly responsible for 15% of global greenhouse gas (GHG) emissions. Abating these emissions will help considerably in reaching the goal of the Paris Agreement to slow global warming to well below 2°C.Greener public procurement will likely cost more, at least in the short run. And the bureaucratic complexity of public procurement operations will make it difficult to align on decarbonization strategy. But these barriers can and must be overcome if governments are to help us reach our climate goals.This report analyses the benefits and challenges of green public procurement and provides specific guidance on how procurement officials can ensure that their procurement activities contribute to our net-zero goals.The vast majority of the emissions for which public procurement is responsible – up to 70% of the total – stem from the activities of just six industries: defence and security, transport, waste management services, construction, industrial products and utilities. The burning of fossil fuels in public transport and defence and security activities is responsible for almost all public procurement’s Scope 1 emissions. Its Scope 2 emissions, from the purchase of electricity to run operations, make up 13% of the total. Upstream Scope 3 emissions generated by the companies from which governments procure goods and services make up the rest, as much as 67%.Abating these emissions will have several benefits. It will lead to