ETHICAL SOURCING IN NHSS Supplier Engagement Day Peter McConnell 21/5/13

NHS Scotland are on a journey towards ensuring Ethical Procurement Practice Start Embed Practice Enhance FoundationLead “I will keep them from harm and injustice” Extract from Hippocratic Oath

1.The NHSS Perspective 2.Risk based approach to Ethical Procurement 3.How we will frame our requirements in relation to EP 4.Live examples of current developing practice 5.Our next steps Within National Procurement and the Procurement Community of the NHSS we are committed to do everything possible to ensure our actions do not negatively impact on those who we rely upon to provide the Goods and Services we require.

NHSS Perspective NHS Scotland is firmly focussed on demonstrable Ethical Sourcing. Engaged with BMA, Ethical Trading Initiative Key staff undergone Marrakesh training delivered by Sustainability Scotland Working actively to better understand issues and potential areas for improvement. 2012/13 introduced ethical sourcing methodologies into overall sourcing practices. Working with Health Boards to conclude an NHS Scotland formal Ethical Sourcing policy for all procurement areas.

Risk based approach to Ethical Procurement

How will we frame our requirement?

Risk based approach to Ethical Procurement Risk based approach adopted Contracts reviewed against risks Initial target commodities identified: –Single Use Podiatry Instruments –National Uniforms –Bedding Textiles

Podiatry Instruments Issue and scope Rated as high risk –Supply chain: Pakistan (Sailkot) > UK New area for NP Contracting Scope: Supply of Single Use Instrument. NHSS Approach Pre Qualification Process highly focused on Ethical Procurement issues –50% based on Quality and Technical Capability –50% on Sustainability Issues with 25% focused on Ethical Procurement (which required Audit Evidence of supply chains, Named subcontractors etc.) Only suppliers achieving score of 60% invited through to tender –Specification and T & C defined Ethical Trading Requirements. –Audits of Subcontractors and supply chain a requirement Post Award Quarterly Supplier Review meetings focusing on: –Quality –Ongoing audit review of supply chain

National Uniforms Issue and scope Rated as High risk –Supply chain: Asian Sub-continent > UK Existing area for NHS Contracting apply previous knowledge Scope: Supply of National Uniform Sets for whole of NHS Scotland NHSS Approach Pre Qualification Process highly focused on Ethical Procurement issues and further developed –Requirement to provide details of EP policy, evidenced by regular audits –Requirement to audit to SMETA (Sedex Members Ethical Trading Audit) standard of auditing and define how subcontractors meet. –Audits of Subcontractors and supply chain a requirement International Labour Organisation Standards Only suppliers achieving score of 60% progress to ITT –Specification and T & C defined Ethical Trading Requirements and evidence required and scored as part of the overall evaluation. –Clear definitions of Contract Suppliers responsibilities throughout duration of contract in relation to ethical sourcing. Post Award Quarterly Supplier Review meetings focusing on: –Review of Contract KPIs –Production/Logistics –Sustainable and Ethical reports and audits

Next Steps Suppliers Understand what the NHSS needs and why Know their end to end supply chain. Ensure suppliers adhere to ILO requirements Working with NHSS to increase standards and transparency of the end to end supply chain Focus on driving up standards within supply chain NHSS Procurement Teams Risk Matrix is used for all commodity Strategies Ensure all sourcing staff are provided with awareness and Training Ensure supply base adheres to and evidences compliance to all relevant Labour Standards Engage with market to clarify requirements and understand ways to improve in the future Focus on driving up standards within supply chain

Thank you