An analysis of the dilemma faced by companies confronted with the inclusion of social and environmental aspects into public bids
We can notice an increasing integration of socio-environmental aspects into bidding documents for infrastructure projects. Public administrations advocate for a higher commitment of business with respect to its impacts and thus resort to the introduction of these aspects into bidding documents to determine actions and results from socio-environmental sector to which business has to commit.
From the public sector, this is aimed at minimizing the risk to leave socio-environmental effects to the exclusive responsibility or willfulness of business, through the definition of actions to be fulfilled in order to ensure the suitability of business activity’s impacts.
The study recently realized by Eptisa, at the request of the Spanish Agency for International Cooperation (AECID) about the integration of this kind of terms in public tenders in Latin America, provides interesting information about the sectors where we can find most of them and the type of aspects included.
Regarding the sectors of greater presence, in order of importance we can mention extractive industry, transports and consecutively, rural and water infrastructure projects. Regarding the typology, also in descending order, the most recurrent aspects are related to environment, mainly to environmental impact aspects and resources management. These are related to the obligation of hiring specialized staff, the realization of prior environmental impacts study, or handling, prevention or mitigation plans, as well as the placement of trash cans or provisions on wastes’ withdrawal and cleaning.
Then we find socio-labour aspects, mainly referred to conditions of work and healthiness, occupational risks and measures of occupational protection. It includes aspects such as security equipments for workers, hiring of specialized staff in case of large-scale interventions, presentation of a security plan or minimum infrastructure conditions for the staff.
Next, other aspects with a strictly social impact are mentioned. We can find among them the prescription of management plans, the setting of measures of mitigation, the delegation of property management tasks with communities, the hiring of specialized staff or the realization of social investment plans in case of affectation to communities.
The realization of prior study is also included sometimes, anticipating socio-environmental risks that can condition the activity or viability of the project. Lastly, there are other aspects with a minor recurrence such as transparency and anti-corruption with complaint compromises and transparency pacts or the inclusion of social audits conducted by third parties (with recognized credibility) attesting the conformity of the bidding process and good execution of the corporative project in relation to its impacts and compliance of clauses.
However, it is common to find companies considering the inclusion of this kind of aspects in public bids as a barrier or a limit. The reason is easy to understand. In many occasions, the competences required to face socio-environmental dynamics are usually not in line with business activity. In other words, even if there are some companies with more experience that have already integrated these capacities, in many occasions these competences cannot be provided by the company’s staff.
But there are several reasons to prevent giving up to bid, or worst, not providing an adequate answer to those requirements and lose possibilities to be successful bidders.
In first place, it is necessary to change the perception we have about these aspects. The inclusion of these elements reinforces guarantees of success for the project since they contribute to reduce social and environmental risks. For example, the realization of socio-environmental prior studies or plans of socio-environmental managements will allow detecting risk factors that can affect the implementation of the project.
In second place, in contexts of institutional weakness, the viability of investments is more related to an adequate relation with the actors from the operation’s context – not only avoiding new problems but also collaborating with them to contribute to the resolution of the ones existing -, than to the supposed legal security that local institutions don’t usually provide.
These aspects constitute an interesting space to put in practice policies of Social Corporative Responsibility
Lastly, these aspects constitute an interesting space to put in practice policies of Social Corporative Responsibility as well as business compromises regarding the Sustainable Development Goals.
As it usually happens with any other challenge, a company facing these aspects has several possibilities. From establishing agreements with local partners, hiring specialized staff (sociologists, environmentalists), specialized companies (consulting, counseling, training, communication, mediation), or training their staff. It can also revise its value chain to strengthen its socio-environmental impact.
Another option is to turn to cooperation agencies working on the field, such as AECID. Cooperation can provide knowledge of the context, especially regarding socio-environmental dimensions, able to recommend local technician and partners that make easier and strengthen the corporative action in this sector. In determined circumstances, there is also a possibility to set up a public-private alliance in order to face socio-environmental challenges.
The world is changing. The inclusion of socio-environmental aspects is the reflection of a major social awareness from the public sector and society in general. Companies can see this process as new requirements to fulfill or as spaces of opportunity to create contexts more favorable, reinforce strategies and corporative viability and to ensure new opportunities for the future.
This post has been written for the Blog New Ways Sustainability