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Journal of Cleaner Production 17 (2009) 1214–1222

Journal of Cleaner Production 17 (2009) 1214–1222 Contents lists available at <a href=S c i e n c e D i r e c t Journal of Cleaner Production journal homepage: www.els evier.com/locate/jclepro Environmental consideration in procurement of construction contracts: current practice, problems and opportunities in green procurement in the Swedish construction industry Annika Varna¨ s * , Berit Balfors, Charlotta Faith-Ell Royal Institute of Technology, Land and Water Resources Engineering, SE-100 44 Stockholm, Sweden article info Article history: Received 19 October 2007 Received in revised form 31 March 2009 Accepted 1 April 2009 Available online 14 May 2009 Keywords: Green procurement Green purchasing Construction contract Environmental management abstract Research and initiatives concerning green procurement have to a great extent focused on products. This article, however, explores the current practice, problems and opportunities of green procurement of construction contracts. In particular, the application of environmental criteria for contract awarding is targeted. The findings of the study indicate that both public and private clients in the Swedish construction industry take environmental issues into consideration in their procurements. The envi- ronmental preferences are often formulated as environmental requirements. However, environmental criteria in tender evaluation are less common and seldom affect the award decisions. The environmental evaluation criteria that do occur often relate to the contractors’ capabilities of managing the environ- mental work in the project. 2009 Elsevier Ltd. All rights reserved. 1. Introduction Applying green procurement preferences in order to promote environmental initiatives is being encouraged by the authorities in many countries, e.g. [1,2–4] , as well as by researchers, e.g. [5,6] . By integrating environmental preferences in the purchase of products, works and services, both public and private organisations can improve their environmental performance and at the same time influence their suppliers to improve the environmental perfor- mance of their products and production processes. For public organisations, green procurement can function as a market-like incentive to enhance green initiatives in the private sector [3,7] . For private organisations, it has been suggested that green purchasing initiatives can result in reduced risks and costs [3] . Although some studies have been carried out regarding green procurement of works and services within the construction sector, e.g. [8,9] , most of the green procurement literature discusses the purchase of products, e.g. [10,11] . This paper, however, focuses on current practices, opportunities and problems concerning green procurement of construction contracts in Sweden. The construction sector accounts for about 40% of the use of energy and materials in Sweden [12] . In addition, the sector * Corresponding author. Fax: þ 46 (0) 8 790 6857. E-mail address: annikav@kth.se (A. Varna¨ s). 0959-6526/$ – see front matter 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.jclepro.2009.04.001 contributes to about 30–50% of the waste generated in higher income countries [13] . It is thus crucial to improve environmental performance in this sector, where green procurement can function as an important incentive [14] . This paper aims at providing an overview of the current prac- tices, opportunities and problems concerning green procurement and its application in the procurement of construction contracts in Sweden. The paper is based on a literature review, a questionnaire study and a series of interviews, with practitioners involved in procurements in major Swedish construction projects. 2. Background and previous findings 2.1. The construction industry and the environment Using approximately 155 TWh of energy, 75 Mt of materials, 3 Mt of chemical products and generating about 5 Mt of waste yearly, the construction industry is a major contributor to envi- ronmental impacts in Sweden [12] . For buildings, the main envi- ronmental aspect is often energy consumption in the finished building, followed by the use of materials and harmful substances. For civil engineering constructions, use of materials and harmful substances during construction works and maintenance, transport during construction and the use of energy during maintenance have been identified as the most important environmental aspects. " id="pdf-obj-0-5" src="pdf-obj-0-5.jpg">

Contents lists available at ScienceDirect

Journal of Cleaner Production

Journal of Cleaner Production 17 (2009) 1214–1222 Contents lists available at <a href=S c i e n c e D i r e c t Journal of Cleaner Production journal homepage: www.els evier.com/locate/jclepro Environmental consideration in procurement of construction contracts: current practice, problems and opportunities in green procurement in the Swedish construction industry Annika Varna¨ s * , Berit Balfors, Charlotta Faith-Ell Royal Institute of Technology, Land and Water Resources Engineering, SE-100 44 Stockholm, Sweden article info Article history: Received 19 October 2007 Received in revised form 31 March 2009 Accepted 1 April 2009 Available online 14 May 2009 Keywords: Green procurement Green purchasing Construction contract Environmental management abstract Research and initiatives concerning green procurement have to a great extent focused on products. This article, however, explores the current practice, problems and opportunities of green procurement of construction contracts. In particular, the application of environmental criteria for contract awarding is targeted. The findings of the study indicate that both public and private clients in the Swedish construction industry take environmental issues into consideration in their procurements. The envi- ronmental preferences are often formulated as environmental requirements. However, environmental criteria in tender evaluation are less common and seldom affect the award decisions. The environmental evaluation criteria that do occur often relate to the contractors’ capabilities of managing the environ- mental work in the project. 2009 Elsevier Ltd. All rights reserved. 1. Introduction Applying green procurement preferences in order to promote environmental initiatives is being encouraged by the authorities in many countries, e.g. [1,2–4] , as well as by researchers, e.g. [5,6] . By integrating environmental preferences in the purchase of products, works and services, both public and private organisations can improve their environmental performance and at the same time influence their suppliers to improve the environmental perfor- mance of their products and production processes. For public organisations, green procurement can function as a market-like incentive to enhance green initiatives in the private sector [3,7] . For private organisations, it has been suggested that green purchasing initiatives can result in reduced risks and costs [3] . Although some studies have been carried out regarding green procurement of works and services within the construction sector, e.g. [8,9] , most of the green procurement literature discusses the purchase of products, e.g. [10,11] . This paper, however, focuses on current practices, opportunities and problems concerning green procurement of construction contracts in Sweden. The construction sector accounts for about 40% of the use of energy and materials in Sweden [12] . In addition, the sector * Corresponding author. Fax: þ 46 (0) 8 790 6857. E-mail address: annikav@kth.se (A. Varna¨ s). 0959-6526/$ – see front matter 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.jclepro.2009.04.001 contributes to about 30–50% of the waste generated in higher income countries [13] . It is thus crucial to improve environmental performance in this sector, where green procurement can function as an important incentive [14] . This paper aims at providing an overview of the current prac- tices, opportunities and problems concerning green procurement and its application in the procurement of construction contracts in Sweden. The paper is based on a literature review, a questionnaire study and a series of interviews, with practitioners involved in procurements in major Swedish construction projects. 2. Background and previous findings 2.1. The construction industry and the environment Using approximately 155 TWh of energy, 75 Mt of materials, 3 Mt of chemical products and generating about 5 Mt of waste yearly, the construction industry is a major contributor to envi- ronmental impacts in Sweden [12] . For buildings, the main envi- ronmental aspect is often energy consumption in the finished building, followed by the use of materials and harmful substances. For civil engineering constructions, use of materials and harmful substances during construction works and maintenance, transport during construction and the use of energy during maintenance have been identified as the most important environmental aspects. " id="pdf-obj-0-28" src="pdf-obj-0-28.jpg">

Environmental consideration in procurement of construction contracts:

current practice, problems and opportunities in green procurement in the Swedish construction industry

Annika Varna¨ s * , Berit Balfors, Charlotta Faith-Ell

Royal Institute of Technology, Land and Water Resources Engineering, SE-100 44 Stockholm, Sweden

article info

Article history:

Received 19 October 2007 Received in revised form 31 March 2009 Accepted 1 April 2009 Available online 14 May 2009

Keywords:

Green procurement

Green purchasing

Construction contract

Environmental management

abstract

Research and initiatives concerning green procurement have to a great extent focused on products. This article, however, explores the current practice, problems and opportunities of green procurement of construction contracts. In particular, the application of environmental criteria for contract awarding is targeted. The findings of the study indicate that both public and private clients in the Swedish construction industry take environmental issues into consideration in their procurements. The envi-

ronmental preferences are often formulated as environmental requirements. However, environmental

criteria in tender evaluation are less common and seldom affect the award decisions. The environmental evaluation criteria that do occur often relate to the contractors’ capabilities of managing the environ- mental work in the project.

2009 Elsevier Ltd. All rights reserved.

1. Introduction

Applying green procurement preferences in order to promote environmental initiatives is being encouraged by the authorities in many countries, e.g. [1,2–4], as well as by researchers, e.g. [5,6]. By integrating environmental preferences in the purchase of products, works and services, both public and private organisations can improve their environmental performance and at the same time influence their suppliers to improve the environmental perfor- mance of their products and production processes. For public organisations, green procurement can function as a market-like incentive to enhance green initiatives in the private sector [3,7]. For private organisations, it has been suggested that green purchasing initiatives can result in reduced risks and costs [3]. Although some studies have been carried out regarding green procurement of works and services within the construction sector, e.g. [8,9], most of the green procurement literature discusses the purchase of products, e.g. [10,11]. This paper, however, focuses on current practices, opportunities and problems concerning green procurement of construction contracts in Sweden. The construction sector accounts for about 40% of the use of energy and materials in Sweden [12]. In addition, the sector

* Corresponding author. Fax: þ46 (0) 8 790 6857. E-mail address: annikav@kth.se (A. Varna¨ s).

0959-6526/$ – see front matter 2009 Elsevier Ltd. All rights reserved.

doi:10.1016/j.jclepro.2009.04.001

contributes to about 30–50% of the waste generated in higher income countries [13]. It is thus crucial to improve environmental performance in this sector, where green procurement can function as an important incentive [14]. This paper aims at providing an overview of the current prac- tices, opportunities and problems concerning green procurement and its application in the procurement of construction contracts in Sweden. The paper is based on a literature review, a questionnaire study and a series of interviews, with practitioners involved in procurements in major Swedish construction projects.

2. Background and previous findings

2.1. The construction industry and the environment

Using approximately 155 TWh of energy, 75 Mt of materials, 3 Mt of chemical products and generating about 5 Mt of waste yearly, the construction industry is a major contributor to envi- ronmental impacts in Sweden [12]. For buildings, the main envi- ronmental aspect is often energy consumption in the finished building, followed by the use of materials and harmful substances. For civil engineering constructions, use of materials and harmful substances during construction works and maintenance, transport during construction and the use of energy during maintenance have been identified as the most important environmental aspects.

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The awareness of the environmental impacts caused by the construction industry has radically increased during the last decades [15]. According to Cole [16], the environmental debate during the last three decades has shifted from an attitude of ‘‘survival’’ to one of responsibility and stewardship, a shift that has affected building research and practice. This attitude shift may be illustrated by the high acceptance for environmental management systems (EMSs) in the sector. In Sweden, about 90% of the construction companies had implemented or were about to implement an EMS in 2006 [17]. Although many companies within the sector are actively working with environmental matters, environmental consideration in construction projects often tends to be narrowed down to a few issues [15]. An inertia for change has also been observed in the sector [17]. Gluch et al. [17] have identified some reasons behind this inertia:

1. the actors within the sector do not believe that there is a green market, a view that hinders green innovations;

  • 2. insufficient cooperation between the parties in the building process;

  • 3. there is no monitoring of the environmental goals or it is inadequate, which decreases the motivation to work towards these goals;

  • 4. the actors in the sector believe that legislation will solve the environmental problems, a view that leads to increased bureaucracy;

  • 5. the idea that banks have little or no influence on the compa- nies’ environmental work results in the environmental issues being treated as a cost burden; and

  • 6. there is often no cooperation with academia and environ- mental organisations or it is insufficient.

In addition, some project characteristics have been identified as barriers to improved environmental performance. The traditional construction project objectives are time, cost and quality [18]. Thus, the traditional project processes do not address non-technical and non-economic aspects such as the environmental ones. It has also been pointed out, that the design of the EMS may not be optimal for the construction industry. While the construction sector is frag- mented with many different actors, mainly organised in temporary project organisations [19], the environmental management systems have been designed to meet the goals of a permanent organisation [15].

Since the first green purchasing initiatives appeared during the 1980s and 1990s [24], green public procurement policies and pro- grammes have now been implemented in many countries throughout the world [3,4,25,26]. An ICLEI study of European public procurement found that 85% of the respondents applied environ- mental preferences in their procurements [25]. However, according to the authors of the report, the respondents seem to have over- estimated the occurrence of environmental preferences, which is rather around 50%. In Sweden, 60% of central government, regional and local authorities stipulate environmental preferences in their procure- ment procedures [4,27]. However, it is only in about half of the cases that these preferences are well specified [4]. In addition, the award decisions are in many cases not based on the environmental criteria presented in the tender documents [4].

  • 2.3. Green purchasing by private firms

Some important motivation factors for implementing sustain- able procurement in the business sector are pressure from stake- holders and NGOs [28]. Although private organisations also may include green criteria in their purchasing decisions, it has been pointed out that private businesses do not usually establish green purchasing activities unless there are clearly stated business benefits [3]. However, it has been suggested that green purchasing in private organisations may result in reduced environmental risks and cost savings, through waste reductions, energy savings and decreased use of materials [3,29]. Preuss [30] argues that the strategic importance of the supply chain management function in manufacturing companies is increasing. However, he points out that awareness of the environ- mental issues does not increase to the same extent, and argues that the environmental issues need to be addressed more in the supplier assessments and evaluation criteria [30]. The effect of the green purchasing activities may depend on the motives behind their implementation. Private firms often adopt green purchasing activities in order to avoid violating regulations [31]. In addition, the effect and extent of the environmental purchasing activities vary with the size and type of company. For example, firms with large purchasing volumes tend to be more involved in green purchasing practices than those with a smaller volume [31].

  • 2.4. Green procurement in the construction industry

2.2. Green public procurement

The traditional approach to environmental management has evolved from pollution control, which can be seen as an end-of- pipe approach, to clean production approaches [20]. However, to make the shift to a sustainable society, even more radical changes are needed. Changes need to be made at the consumption level

[20].

Environmental or green purchasing or procurement can be referred to as the integration of environmental considerations into purchasing policies, programmes and actions [21]. Within the European Union, procurement by public authorities should follow rules stipulated by the EU procurement directives. The new direc- tives specifically mention possibilities for including environmental criteria in procurement decisions [22,23]. Green procurement preferences can be formulated as mandatory environmental requirements. However, environmental criteria may also be considered in the tender evaluation, alongside other criteria such as price, technique and organisation.

In the Swedish construction industry, both public and private organisations apply environmental procurement preferences [8,9]. However, their effectiveness may be hard to assess as environ- mental indicators and baseline data are often lacking [32]. According to Sterner [33], Swedish clients find it difficult to eval- uate environmental impacts. She calls for methods to assist clients in tender evaluation and in the evaluation of the environmental impact of materials. Three different steps in the construction process have been suggested for applying environmental criteria [34]:

1. in the preliminary design/architectural competition; 2. in the tendering for the construction contract; and 3. in the tendering for the building services such as heating, ventilation and air conditioning.

The Swedish Environmental Management Council (former EKU- committee) especially suggests environmental evaluation criteria for the construction sector [14]. According to the council, envi- ronmental preferences as evaluation criteria will promote

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a creative development of the environmental issues in the construction sector. However, the environmental preferences currently applied in procurement in the Swedish construction sector can generally be characterized as ‘‘basic environmental requirements’’, and are often connected to harmful substances in certain products [14]. Some common environmental procurement preferences in the construction sector include that the contractor or consultant should possess an EMS or parts of an EMS, waste management, handling of chemical products, and that some technical, project-specific envi- ronmental requirements should be observed [14]. However, when EMS is used as a criterion in procurement, it may be hard to differentiate between the companies that only produce nice documents and those that actually perform well [35]. Sterner argues that environmental requirements on materials should only aim to avoid harmful substances, since other requirements may hinder competition and increase costs [9]. It has been pointed out that the applied criteria do not always correspond to the importance of the environmental aspects [33]. Energy use in the finished building is not always represented among the environmental criteria in the procurement of building contracts, although this is regarded as the most significant envi- ronmental aspect for buildings [33]. Although environmentally designed buildings may have higher initial costs, it has been shown that they are often in the same cost range as conventional buildings due to a lower life-cycle cost [9]. Therefore, for the procurement of building contracts, it has been argued that choosing an alternative with a lower life-cycle cost will at the same time be less harmful to the environment [9].

2.5. Green procurement – opportunities and problems

Although many green procurement initiatives have been star- ted, their effects are hard to estimate since the procedures for monitoring the environmental requirements are often insufficient [27,28,32,36]. Success regarding single environmental criteria such as energy savings has been shown, but the overall environmental effectiveness has been hard to prove [37]. Green public procurement has in some cases brought unfore- seen, soft effects. It has, for example, helped to demonstrate government leadership and given credibility to national environ- mental agenda [37]. In addition, it has increased green purchasing in the private sector and by employees as customers. Some reasons suggested for the insufficient monitoring are lack of appropriate environmental data as well as the high costs of monitoring [36]. This could be solved by imposing fewer environ- mental requirements that focus on the most significant environ- mental aspects and that can easily be verified [36]. Lack of environmental data is generally regarded as a main barrier to green procurement [24,25,38]. Some approaches used to overcome these problems are:

1. a single issue approach, where just one criterion is used;

  • 2. a life-cycle approach, involving calculation of the environ- mental impacts;

  • 3. use of eco-labels and guidebooks; and

  • 4. purchasing from suppliers who apply certain environmental management measures [38].

In order to simplify and aid the green purchasing process, some call for increased use of tools such as environmental management systems and decision support tools [39–41]. However, it has been pointed out that the decision support tools for sustainable purchasing need to be further developed [28].

Another barrier to green procurement is that green products may not always be available [39]. However, the number of green products may increase as authorities create a demand for them [39]. In addition, the green options may be regarded as more expensive [25]. While many authors discuss how public and private organisations can achieve environmental gains by replacing prod- ucts and services by more environmentally preferable ones, van der Grijp [42] points out that the crucial choice should rather be to reduce the amount of products purchased. According to Murphy and Bendell [43], improving organisations’ environmental performance through green purchasing can be more complex than other environmental initiatives. To address this problem, increased collaboration between organisations such as NGOs and companies may be helpful [43]. Some organisational factors that can contribute to successful green purchasing are committed middle managers [44,45] and the establishment of a corporate culture of environmental awareness [40]. The impor- tance of training has also been pointed out [26,28,44] and the presence of an EMS has been recognized as helpful in the imple- mentation of green procurement practices [28,39]. Good communication and coordination, both within the organi- sation [28,42] and between suppliers and clients [28,46] have also been called for. Several authors also call for the development of clear goals [44], green purchasing policies [47] or the inclusion of sustainability strategies in procurement policy documents [48]. Sanders [49] points out the importance of using different approaches for different types of procurement and product categories. As shown in this section, many authors point out the need for using environmental procurement preferences. At the same time, there seems to be many difficulties involved in applying such preferences. There thus appears to be a need to study how envi- ronmental procurement preferences are applied and the difficulties that procuring officers encounter in this work. In order to address these issues in the procurement of construction contracts in Sweden, a survey was initiated.

3. Survey methods

The data used in this study are in two parts – responses from a questionnaire and transcripts from aninterview series.Whereas the questionnaire aimed at achieving an overall picture of the application of environmental preferences in the procurement of construction contracts in Sweden, the main purpose of the interviews was to achieve a deeper understanding of the reasons for applying these environmental preferences, how they are applied in the procurement and how they are monitored during the construction works.

3.1. Questionnaire

3.1.1. Questionnaire design and procedure

A questionnaire was sent to 62 key persons at clients’ organi-

sations involved in the procurements at extensive, ongoing construction projects in Sweden. Information about the projects was obtained from a database provided by a company that supplies data about construction projects to organisations in the field. The main construction contract for the selected projects had recently undergone procurement. Their estimated contract cost was above MSEK 100 (approximately 10 million euros). If one organisation had several ongoing projects in the database, only two projects from that organisation were included in the study. Thus, the main criteria for selecting the projects were:

1. time for procurement of main construction contract;

  • 2. estimated contract cost; and

  • 3. variety of the organisations included in the survey.

A. Varna¨ s et al. / Journal of Cleaner Production 17 (2009) 1214–1222

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The persons contacted were the ones listed in the database as contact persons, which were usually project leaders or procure- ment officers. The questionnaire consisted of seven classification questions as described by Oppenheim [50] and six other, factual questions focusing on how environmental issues were considered in the procurements. Multiple-choice questions were chosen in order to make the questionnaire easy to answer. The classification questions concerned the respondent’s role in the project, project type, type of client organisation, contract type, cost of the project, time for procurement and time for project start. The other questions referred to whether or not environmental preferences were considered in the procurement, the type of environmental prefer- ences applied, whether project-specific environmental preferences had been considered, whether environmental evaluation criteria had been applied and the way the environmental requirements were monitored during construction work. Each questionnaire was sent by post in the late autumn of 2005, accompanied by a covering letter. If no answer had been received after a month, the respondent was contacted by telephone and asked to complete the form. This procedure yielded a response rate of 82 percent, i.e. 51 of the 62 questionnaires were entirely completed and returned. Projects with a project cost lower than MSEK 50 (approximately 5 million euros) were omitted, since the focus for the study was extensive construction projects. This resulted in a final response rate of 77 per cent valid responses, i.e. 48 answers remained to be analysed. Of the remaining 48 answers, 39 were from building projects, six from civil engineering projects and three of the respondents answered that the projects were both civil engineering and building projects. These have been included in both categories in the analyses, as well as in the tables in the next section. Twenty- three respondents were from public organisations, 24 were private organisations and one answer was categorised as ‘‘other type of organisation’’. Some of the respondents had answered that both design and build contracts, i.e. a contract where the contractor is responsible for both the design and the construction, and other contracts had been used in the project. Some contracts were per- formed by the client organisation itself. However, the majority of the projects could be regarded as design and build contracts.

3.1.2. Analyses of the questionnaire responses

In the analyses, four main themes in the questionnaire

responses were targeted:

1. application of project-specific environmental preferences;

  • 2. application of environmental evaluation criteria;

  • 3. types of environmental preferences applied; and

  • 4. ways to monitor the environmental requirements during the construction work.

When the application of project-specific preferences and the application of evaluation criteria were studied, the projects were organised according to their:

1. project type, i.e. building or civil engineering construction

project;

  • 2. type of client organisation, i.e. public or private organisation;

  • 3. type of contractual arrangement, i.e. design and build contract or other type.

For each of the three categories, differences in the application of project-specific preferences and evaluation criteria were analysed. The three projects that were both building and civil engineering projects were included in both categories.

3.2. Interviews

Following the questionnaire study, an interview series was carried out to achieve a greater insight into the application of environmental preferences in some of the projects. Eight of the respondents from the questionnaire study were contacted for an interview. These had all stated that they applied environmental evaluation criteria, and not only basic environmental requirements. The interviews were semi-structured with a sequence of themes to be covered, but with the openness to changes of sequence as described by Kvale [51]. The main themes of the interviews were:

1. reasons for including environmental preferences in the procurements; 2. development of the environmental requirements and criteria; 3. reasons for limiting the application of environmental preferences; 4. the application of environmental evaluation criteria; and 5. how the requirements are monitored during construction work.

All interviews but one were conducted over the telephone, since the interviewees were spread out across the country. The inter- views were recorded, transcribed and analysed. Using a software tool for qualitative data, the transcripts were organised into cate- gories and subcategories as described by Kvale [51].

4. Results

4.1. Results from the questionnaire

4.1.1. Application of project-specific environmental preferences

According to the respondents, environmental preferences were common in the procurements. Only three respondents answered that no environmental requirements or environmental evaluation criteria had been applied at all. These were all building projects, organised by private organisations and the contractual arrange- ment was design and build. In a slight majority of the procurements, 27 projects, only standard, basic environmental preferences set up by the respective procuring organisation were applied. In the other 21 projects, project-specific environmental preferences had also been applied. Of the building projects, only standard environmental preferences were applied in 26 of the projects whereas project-specific pref- erences were applied in 16 of the projects (Table 1). Among the civil engineering projects, the distribution was more even. Most of the private organisations applied only the standard environmental preferences (Table 2). When the different contractual arrangements were compared, no clear difference was found in the application of project-specific environmental preferences. This was partly due to unclear answers by some of the respondents.

4.1.2. Application of environmental evaluation criteria

Out of the total 48 valid responses, only nine of the respondents answered that environmental evaluation criteria were applied. Both civil engineering and building projects were found in this group (Table 3). Of the nine projects where environmental evaluation criteria had been applied, eight also included project-specific environ- mental preferences, and not only the standard environmental preferences set up by their organisation. All the organisations that applied environmental evaluation criteria were public organisa- tions (Table 4). As was the case with the basic versus project-specific require- ments, comparing the application of environmental evaluation

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Table 1

Table 3

Number of building and civil engineering projects where standard versus project- specific environmental preferences were applied.

 

Number of building and civil engineering projects where only environmental requirements versus also evaluation criteria were applied.

   
 

Building projects (n ¼ 42)

Civil engineering projects (n ¼ 9)

 

Building projects (n ¼ 42)

Civil engineering projects (n ¼ 9)

Only standard environmental preferences have been applied

  • 26 4

Only environmental requirements were applied

34

5

Project-specific environmental preferences have also been applied

  • 16 5

Environmental evaluation criteria were also applied

5

4

criteria for different types of contractual arrangements gave no clear indications regarding in which type of contractual arrange- ment the criteria were most common.

  • 4.1.3. Type of environmental requirements

Of the different types of environmental requirements applied, those regarding waste disposal during construction, environmental plan during construction, working environment and the con- tractor’s environmental management system had a high frequency among both the building and the civil engineering projects (Figs. 1 and 2). The civil engineering projects tended to have a stronger focus on emissions connected to construction work, whereas there was a stronger focus on requirements regarding materials and

substances used in the building projects.

  • 4.1.4. Monitoring the requirements

The contractor’s self-inspection was the most common way to monitor the environmental requirements during construction, followed by revisions and building meetings. Several of the respondents answered that they applied more than one type of monitoring procedure (Table 5).

4.2. Results from the interviews

  • 4.2.1. Reasons for applying environmental procurement preferences

It was found during the interviews that directions from the client organisation and procedures set up by the environmental management system, as well as the presence of a committed manager were common reasons for clients to apply environmental preferences in the contract procurements. Other reasons were legal requirements and other directions from the authorities, cost reductions and requests from the tenants in the finished building. One respondent suggested that stipulating environmental evalua- tion criteria was a way to find a contractor capable of fulfilling the environmental requirements.

  • 4.2.2. Formulating the environmental preferences

The use of expert judgment appeared as the most frequent

method when clients formulate the environmental preferences. Although some organisations had their own groups of environ- mental specialists, the environmental preferences were in most cases formulated in cooperation with consultants and representa- tives from the local authorities.

Table 2

In addition, experiences from previous projects played an important role. In some cases, the same requirements were applied in different projects. In these cases, many of the requirements were associated with the EMS. However, in most of the projects, at least some of the environmental procurement preferences were specif- ically designed for the project. These project-specific environ- mental preferences were often found during specific measurements before the start of the project, such as groundwater measurements, carried out during the project planning or design stages. Some of the tools mentioned to identify environmental requirements were environmental impact assessment, risk assessment and life-cycle assessment. Also of importance for the formulation of the environmental preferences were laws and requirements from local authorities. In addition, lists of suggestions from authorities such as the National Board of Housing, Building and Planning, the Swedish Chemical Agency and insurance companies were also commonly used to find environmental preferences. The verdict of the Environmental Court was also mentioned.

  • 4.2.3. Reasons for limiting the application of environmental

procurement preferences

Among the reasons for clients to limit the application of envi- ronmental preferences in the contract procurements, the fear of introducing limitations, high costs or time-consuming bureaucracy into the project were the most common. It was especially pointed out that when the contractual arrangement ‘‘design and build’’ is used, the design is carried out after the procurement, which makes it less meaningful to introduce certain types of environmental preferences in the procurement stage. In addition, the environmental preferences were sometimes limited in order to simplify the tendering process. Soft evaluation criteria such as the environmental ones were sometimes limited to minimise the risk of appeals after the procurement. Also mentioned as a reason for limiting the application of environmental procurement preferences was lack of knowledge. In addition, some respondents found that for certain environmental aspects, it may be hard to formulate environmental preferences that are specific, measurable and verifiable.

  • 4.2.4. Application of environmental evaluation criteria

Among the types of environmental evaluation criteria applied by the clients in the procurements, the environmental manage- ment system was the most common. One reason for choosing to use

Number of public and private client organisations that had applied standard versus project-specific requirements.

 

Table 4

 
 

Public

Private

Number of public and private client organisations that applied only environmental requirements versus also environmental evaluation criteria.

organisations (n ¼ 23)

organisations (n ¼ 24)

 

Public organisations (n ¼ 23)

Private organisations (n ¼ 24)

Only standard environmental preferences have been applied

11

16

Only environmental requirements were applied

14

22

Project-specific environmental preferences have also been applied

12

8

Environmental evaluation criteria were also applied

9

0

A. Varna¨ s et al. / Journal of Cleaner Production 17 (2009) 1214–1222

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100% 80% 60% 40% 20% 0% Harmful Other Other Waste Environmental Contractor's Working Requirements substances requirements
100%
80%
60%
40%
20%
0%
Harmful
Other
Other
Waste
Environmental
Contractor's
Working
Requirements
substances
requirements
requirements
disposal during
plan during
EMS
environment
regarding
regarding use
regarding use
construction
construction
of material
of chemicals
works
works
requirements waste disposal
in the building

Fig. 1. Percentage of the building projects where each of the eight most frequent environmental requirements had been applied.

this as an evaluation criterion rather than a requirement was not to exclude firms without an EMS from the procurement. Other aspects considered as evaluation criteria in the tender evaluations were the environmental knowledge of the project organisation and the handling of environmental aspects, which are usually described in the environmental plan. The types of machines used and energy use in the finished building were also mentioned as evaluation criteria. In none of the projects in the interview series did the environ- mental criteria have an effect on the outcome of the evaluation. Nonetheless, one of the respondents argued that applying envi- ronmental criteria was important, in order to make the tenderers aware of high environmental project standards, which in turn improved the environmental quality in the project. It was also pointed out by some respondents that the environmental criteria could have an effect on the evaluation, in other projects. The environmental criteria were in most cases assigned a maximum of 10% weighting in the evaluation. According to one respondent, the environmental issues and hence the weighting of the environmental criteria tended to be more important in certain types of projects.

4.2.5. Monitoring environmental preferences

Among the alternatives for clients to monitor the environmental

requirements during construction work, the contractor’s self-

inspection appeared to be the most common. The contractor is usually obliged to report any errors during construction. The clients often seemed to trust the contractor to contact them before the purchase of a new product or before calling in another subcontractor. However, sample tests performed by the client organisation aswell as inspections were also mentioned as a way to check that the envi- ronmental and other requirements were fulfilled. In addition, revi- sions and project meetings were also frequently mentioned. In some cases the contractor had to prepare a report prior to such meetings.

5. Discussion

The aim of this paper is to provide an overview of current practices in green construction contract procurement in Sweden. A literature review has introduced the issue of green procurement and the challenges and opportunities related to it. A survey con- sisting of a questionnaire and a series of interviews has reviewed the practices of green procurement of construction contracts in Sweden. In this section, the findings from the literature review and the survey are further discussed. The results from the questionnaire indicate that both private and public clients in Sweden take environmental issues into consideration when procuring their construction contracts. Most of the respondents answered that they had stipulated environ- mental preferences in the procurements. However, a tendency to

100% 80% 60% 40% 20% 0% Harmful Waste Environmental Requirements Contractor's Emissions to Emissions to Working
100%
80%
60%
40%
20%
0%
Harmful
Waste
Environmental
Requirements Contractor's
Emissions to
Emissions to
Working
substances
disposal during
plan during
regarding
EMS
water during
soil during
environment
construction
construction
machines used
construction
production
requirements
works
works
works

Fig. 2. Percentage of the civil engineering projects where each of the eight most frequent environmental requirements had been applied.

  • 1220 A. Varna¨ s et al. / Journal of Cleaner Production 17 (2009) 1214–1222

Table 5

Different ways to monitor the requirements.

 

Type of monitoring

Number of respondents (n ¼ 48)

The environmental criteria are not monitored

2

Sample tests

20

Inspections during the construction project

19

Inspections after completion

12

Building meetings

26

Revisions

28

Contractor’s self-inspection

40

Other type of monitoring

13

overestimate the application of green preferences has been noticed in previous studies [25] and a similar phenomenon may have occurred also in this survey. Procurement of construction contracts differs from the procurement of products. At the time of procurement, there are limited opportunities to judge whether or not the tenderers will fulfil the environmental requirements. Here, a comment from one of the respondents can be highlighted: there are environmental requirements that the contractor needs to fulfil; the environmental evaluation criteria are in turn used to evaluate how likely each tenderer is to fulfil these requirements. For procurement of construction contracts, the application of environmental evaluation criteria is especially emphasised, since they are assumed to stimulate green innovations in the sector [14]. However, the findings of this survey indicate that this has not yet reached out to the practitioners. Few of the respondents had applied environmental criteria when evaluating the tenders. Among the criteria applied, the presence of an environmental management system in the contractor’s organisation was the most common. The EMS, however, concerns the way environmental issues are handled and organised and does not specifically encourage innovations [15]. However, if the purchase or procure- ment concerns a service or work to be performed, EMS can be a proof of the tenderer’s ability to take environmental management measures during the service or work [26]. In none of the cases did the environmental criteria influence the outcome of the evaluations. The role of the environmental criteria can thus be questioned. However, some pointed out that the environmental criteria could have an effect in other projects. In addition, the common use of EMS as evaluation criterion raises a few questions. As mentioned earlier, environmental management systems concern the global performance of companies, and are not designed to meet the goals of the project-based organisations [15]. In addition, a certified EMS does not guarantee a high level of environmental performance [52]. Although EMS can be created to suit the project-based construction organisation, in the procure- ment situation, it can be difficult to differentiate between the companies that only produce nice documents and the ones that actually perform well [35]. The role of the EMS in the construction projects and its possible use in bidder assessment and tender evaluation can be addressed in future research. Not only was EMS a common evaluation criterion. In addition, the presence of an EMS within the client organisation was recog- nised as one of the main reasons for applying environmental preferences in the procurement. Its importance in the stage of formulating environmental requirements and criteria was also mentioned. This is in line with previous research which recognises the benefits of linking EMS and green purchasing in order to ach- ieve improved environmental performance [53,54]. Commitment among the managers was another important factor for applying environmental evaluation criteria. This finding

supports the idea of the importance of committed leaders to bring success to the environmental purchasing programme [44,45], as described earlier. In formulating the environmental preferences, expert judgment and experiences from previous projects were important. In the cases where project-specific requirements were applied, some tools such as environmental impact assessment (EIA), risk assess- ment and life-cycle assessment were mentioned. The use of tools such as EIA to formulate environmental preferences for the procurement and to identify environmental aspects to include in the project-EMS could be further explored in future studies. One of the reasons mentioned behind limiting the application of procurement preferences was lack of knowledge. A way to address this problem could be to increase the use of different tools, such as procurement systems, or generalised requirements and criteria. The Swedish Environmental Management Council has been working on developing environmental requirements for building projects. For civil engineering projects, no requirements have yet been developed. However, the Swedish Road Administration has produced a guideline of environmental requirements that can be used in procurements. For building projects, other tools have also been developed to improve the environmental performance of the buildings. One of these is the LEED certification (Leadership in Energy and Environmental Design), which has been developed by the U.S. Green Building Council. A LEED certification of a building is made by an independent third party, which verifies that the building follows certain green building requirements. The interest for LEED in Sweden has increased during the last years. However, other green building standards are also being utilised, such as the one developed by the Building-Living Dialogue. Studies have been made, e.g. [55] regarding different ways to assess the environ- mental aspects of buildings in Sweden. It could be interesting to further study how such systems could be used in procurements in Sweden. Future studies could also address such systems and possibilities for increased use of them for procurements of civil engineering projects. Another way to address the problem of lack of knowledge among clients’ organisations could be to aim for increased collab- orations between clients, which could be done by for example using workshops and similar activities for clients. The lack of knowledge could also be addressed by trying to develop tools to assist clients in their development of environmental criteria and requirements. Another reason for limiting the application of environmental preferences was the fear that such preferences could bring increased costs to the project. Yet, a wish to decrease costs was also mentioned as a reason for applying environmental preferences. Studies have found that considering life-cycle costs instead of merely the purchase cost often lead to a lower overall cost [9]. At the same time, the environmental burden is decreased, since a lower life-cycle cost often brings decreased environmental impacts, in forms of energy savings for example in the finished building. However, a problem here could possibly be that the procuring organisation may not remain the owner of the building. For public authorities however, the aim should be to reduce the life- cycle costs and thereby the environmental costs, and not only the purchase cost. It could be interesting to further study whether projects in which more environmental preferences have been applied are in fact more costly than others, and in particular to make such a study for civil engineering projects. If the same find- ings can be found for civil engineering projects as for building projects, this would indicate that environmental preferences should be used more in procurements. Public clients more often applied environmental evaluation criteria than private ones. The civil engineering projects tended to

A. Varna¨ s et al. / Journal of Cleaner Production 17 (2009) 1214–1222

1221

have a stronger focus on requirements during construction works, such as machines used, and requirements for transport and emis- sions during construction works. This seems appropriate, since energy use during the use of the building is usually considered the main environmental aspect of buildings, whereas for other construction projects, many of the main environmental aspects are connected to the construction work [12]. However, this study aimed at achieving an overview of the application of environmental procurement preferences in the Swedish construction industry and was limited in its scope. In addition, the distribution between building and civil engineering projects was uneven. In order to further investigate differences between project types or type of organisation, investigations specifically aiming at clarifying those differences are suggested. Several of the respondents used more than one type of moni- toring procedures. Among the monitoring procedures used, the contractors’ self-inspection was the most common, followed by revisions and building meetings. However, as mentioned earlier, other studies have found that monitoring of the environmental requirements is often insufficient or inefficient, e.g. [32]. The connection between environmental requirements and the way they are monitored can be addressed in future research. A design and build contract gives more opportunity for the contractor to make decisions than other types of contract. Hence, it could be expected that the environmental criteria varied depending on the contractual arrangement. The results of this survey could not give any clear indications of that, partly due to the fact that some respondents had been unclear in their answers. However, the answers in the interviews indicate that the use of a design and build contract might limit the application of environmental require- ments. When the design is carried out after the procurement, it may be impossible or less meaningful to stipulate certain types of requirements in the procurement. Further research could explore the relationships between contractual arrangement and the chan- ces of stipulating and monitoring environmental preferences more thoroughly.

6. Conclusions

This study indicates that environmental parameters are often taken into consideration in procurement of construction contracts in Sweden. Environmental evaluation criteria, however, are less common. Some of the reasons for this found in the study were the risk of appeals that may delay the project and a desire to simplify the tendering procedure. Other reasons for limiting the application of environmental criteria were the fear of bringing increased costs and limitations to the project. In general, environmental preferences regarding the finished construction tended to be more common in building contract procurement, whereas preferences regarding impacts during the actual construction process seemed more common in civil engi- neering contracts. Among the projects included in the survey, some of the most common environmental criteria concerned waste disposal during production, use of harmful substances, working environment and the environmental management system in the contractor’s organisation. Use of expert judgment was the most frequent method for formulating the requirements and criteria. Regular project meet- ings, revisions and contractors’ self-inspection were the most common ways of monitoring the requirements. The most frequent environmental evaluation criterion was the environmental management system. The EMS may be used as proof of the tenderer’s ability to deal with environmental issues during the project. In addition, the EMS of the client’s organisation also played an important role as a reason for applying environmental

requirements and criteria as well as for formulating the require- ments. Committed management and procedures set up by the cli- ent’s organisation were some other important motivating factors. In the cases where environmental evaluation criteria were applied, they seldom seem to affect the outcome of the evaluation. Nonetheless, the criteria may function as a way of demonstrating high environmental ambitions in the project, which in turn may affect the tenders and the performance during construction work.

Acknowledgements

The authors would like to thank FORMAS – The Swedish Research Council for Environment, Agricultural Sciences and Spatial Planning for funding the project and Reed Business Infor- mation Sweden AB for providing the contact information regarding the construction projects.

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