Maximising “Community Benefits” in public procurement: tensions and trade-offs

Abstract

PurposeThis study aims to illuminate the challenges involved in implementing community benefits (CBs), a sustainable public procurement policy that ensures that there are positive social and economic outcomes for the local community when public money is spent on goods, works and services.Design/methodology/approachInterviews and focus groups were conducted with public sector buyers and suppliers in Wales with experience in implementing CBs. Resource dependence theory was used to examine the extent to which dependence on resources effects CBs implementation.FindingsWhilst the study confirms that implementation of CBs improves economic and social outcomes, there can also be challenges for public sector organisations and their constituent supply chains. These include tensions between CBs and other policies, differing views between buyers and suppliers, and the unintended consequences of promoting one form of CBs over another.Research limitations/implicationsThe research found that Welsh Government influences the buyer-supplier dyad through regulatory and financial power. We elaborate on resource dependency theory by adding four constructs (powerful stakeholders, intra and inter organisational issues, challenges and enablers) to better understand the flows of power and resources in this research context.Practical implicationsBuyer and supplier practitioners and policymakers may find the factors leading to successful CBs implementation useful, such as ensuring closer communication and liaison at early contract stages.Social implicationsCommunity benefits are aimed at improving socioeconomic issues through public procurement.Originality/valueThis study addresses the need for research into how public sector organisations and suppliers seek to implement socio-economic sustainability measures, and the lack of research on CBs implementation to date. It is also novel in adopting a dyadic approach and a resource dependency perspective.

The hidden side of sustainable operations and supply chain management: unanticipated outcomes, trade-offs and tensions

“…Although coming from different directions, the empirical and theoretical work of the selected papers for this special issue point out that unintended outcomes may arise when relevant interactions are disregarded. Overall, these studies indicate the reasons why they may vary between ignorance and self-interest (Nath et al, 2020;Silvestre et al, 2020;Glover, 2020) or, due to complexity, these interactions may be difficult to identify (Carter et al, 2020;Wontner et al, 2020;Ye et al, 2020). While these studies significantly contribute to describing the phenomena of trade-offs and unintended issues, it is still not clear how such problems emerge.…”

“…The study by Wontner et al (2020) explores the challenges of implementing a sustainable public procurement policy in the form of community benefits to ensure that public expenditures result in positive social and economic outcomes for the local community. Drawing on resource dependence theory, they found that while implementing community benefit policies improve economic and social outcomes, differing views between buyers and suppliers often creates tensions, while unintended consequences may result when one form of community benefits (CB) is promoted over another.…”

“…An implicit assumption is that the good intentions of adopting sustainable practices may come at a financial cost, but otherwise will inevitably lead to societal benefits. In practice, such good intentions may be undermined by highly complex interactions among the myriad of sustainability parameters, and thus difficult to identify (Matos and Hall, 2007;Reiner et al, 2015;Carter et al, 2020, Wontner et al, 2020Ye et al, 2020). They may also be shaped by variances in ignorance and self-interest (Nath et al, 2020;Silvestre et al, 2020;Glover, 2020).…”

Saudi Procurement System and Regulations: Overview of Local and International Administrative Contracts

“…They found that increasing public purchases helped to raise the investment of vendor firms. Wontner et al (2020) found that implementing community benefit in the procurement process and policy would increase public projects' economic and social outcomes. However, potential differences in the comparison of community benefit and views of buyers and sellers could be constraints in the way of procurement.…”

Analysis of the Situation of Social Public Procurement of Works at the Valencian Region (Spain)

“…In relation to the barriers that currently hold back social procurement, one of them is the difficulty to establish objectives for the quantification of the social value [37]. Wonter et al [38], in their study on community benefits in Welsh public procurement, pointed out how suppliers show their rejection with the introduction of socio-economic criteria in the tendering process, since these costs end up being passed on to the final customers or absorbed by the companies, and this entails a risk of exclusion of small and medium enterprises in public procurement. The barriers to the introduction of social criteria in public procurement could be one of the future research lines for scientific academics.…”