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Integrating ESG reporting with the Sustainable Development Goals (SDGs)

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By Dr. Kariuki Muigua, PhD (Leading Environmental Law Scholar, Policy Advisor, Natural Resources Lawyer and Dispute Resolution Expert from Kenya), Winner of Kenya’s ADR Practitioner of the Year 2021, ADR Publication of the Year 2021 and CIArb (Kenya) Lifetime Achievement Award 2021*

In the quest for transparency, the new paradigm for conducting business, organizations are increasing resorting to better ESG reporting to understand, communicate, and better manage their contributions to the SDGs. This is also in tandem with Target 12.6 of the SDGs which encourages companies to adopt sustainable practices and integrate sustainability information into their reporting.  Essentially, Sustainable Development Goals (SDGs) initiative sets forth 17 critical areas to solve economic, social, and environmental challenges by 2030 and all 193 UN Member States have agreed to the “Agenda 2030”, calling on all businesses, big and small, to actively and creatively be part of the solutions and take impactful steps to achieve success.[1] UN SDGs have been described as the leading ESG for large companies because as at February 2018 approximately 40% of the G250, the world’s largest 250 companies, acknowledged the SDGs in their corporate reporting and included the global goals in their CEO and/or Chair’s message.[2]

With the upsurge of Environmental, Social, and Governance (ESG) reporting as a strategic and operational agenda of more and more companies, the UN SDGs have become acknowledged as the best tools to use as a framework to improve ESG risk scores and secure long-term business performance. It has been noted that the 169 SDG specific targets present a wide range of opportunities for businesses to make a difference. Thus, the UN Sustainability Goals are used to manage ESG reporting and create long-term financial value. Some of the ways implementing UN SDGs can help improve business ESG risk scores include paying fair share of taxes in countries of operation and avoid tax evasion, including marginalized and underrepresented persons in the value chain, investing in communities, ensuring absence of slavery in the supply chain, paying fair prices to suppliers, practicing inclusion through corporate policies, disclosing GHG emission and climate risk exposure due to business activities.[3]

In addition, companies should also participate in improving processes to reduce waste, including packaging and distribution, educating and encouraging suppliers to adhere to strict standards, building domestic and global partnerships in healthcare, education programs, training, etc. and assessing and correcting gaps in resource use and waste procedures. They should also revise internal policies to eliminate unintended bias and discrimination, develop female leadership programs, understand the impact of business activities on natural resources, water and energy use, support new business models that can deliver clean/renewable energy, establish sustainable procurement policies and supplier codes of conduct, promote responsible consumption through marketing and PR events and sponsor NGO initiatives to restore degraded habitats.[4]

The ESG Manual recommends that as part of the ESG situational analysis that the ESG reporting team work with senior management and departmental heads to prioritise the most relevant Sustainable Development Goals (SDGs) for the organization. It notes that a key emphasis of the SGDs is creating shared value (value to the business and to society) within the organisation’s own core operations. It adds that the reporting process illustrated in the manual can be used to report progress on the SDGs within the ESG report. According to the ESG Manual, the SDGs can also help in the identification of material topics and or impact. Thus, by aligning organisational objectives with the SDGs, organisations can identify significant impact areas that affect their contribution to the SDGs.

As part of opportunity assessment in value creation, the ESG Manual recommends that opportunities should consider to create shared value for the organisation based on the SDGs at this stage. For example, to capture climate related opportunities, organisations can raise capital to finance “green projects” through issuance of green bonds that target an increasing number of ESG focused investors. Organisations can also implement energy efficiency programs and invest in renewable energy to cut future energy costs and ensure compliance with emerging climate related regulations. Such an approach also helps the organisation demonstrate contribution to the SDGs, in this case SDG 13 on Climate Action.

The ESG Manual also recommends that listed companies be encouraged to report their progress and contribution to the Sustainable Development Goals (SDGs). In this regard, the identified material ESG disclosures can be linked with the specific targets for the prioritised SDGs and progress reported using the approach presented in this manual. Listed companies are also encouraged to report progress and contribution to the Sustainable Development Goals (SDGs). The identified material ESG disclosures can be linked with the specific targets for the prioritised SDGs and progress reported using the approach presented in this manual.

The ESG Manual recommends various ways through which the ESG reporting process can demonstrate their contribution to the Sustainable Development Goals (SDGs) by aligning their material ESG topics with the targets contained in SDGs. Indeed, GRI has published a detailed guide on integrating the SDGs into corporate reporting. ESG manual can be applied in SDG reporting in defining priority SDG targets, in measuring and analyzing contribution to SDGs and reporting, implementing and integrating change. The ESG manual recommends a reporting approach that allows progress on the SGDs to be reported within the ESG report rather than as a separate report.

In defining priority SDGs targets, there is need to understand the SDGs generally and their targets in particular and conduct principled prioritization of SDG targets as well as define your SDG-related report content. The ESG Manual recommends that as part of the situational analysis process, the ESG reporting team identifies and prioritizes the relevant SDGs along with their respective targets for the organisation. Further, it is recommended that at the content creation phase it is demonstrated how ESG data such as the SDGs can be collected in a structured way. Measuring and analyzing with respect to SDGs includes setting business objectives, selecting appropriate disclosures and collecting and analyzing data. The ESG Manual recommends identifying appropriate disclosures through the materiality assessment process and linking back the ESG topics with the targets contained in the SDGs. Further, it recommends that collection and analysis of data follow the same data collection process outlined in the manual for ESG performance data.

The ESG Manual also recommends that listed companies consider general features of good practice when reporting on the SDGs as well as data users’ information needs before reporting and implementing change. The ESG Manual recommends that the Reporting Principles be used as a guide on good practice SDG reporting. The stakeholder assessment process be applied to help identify the unique needs of different stakeholders, including how the different SDGs apply to them. Finally, the GRI standards are proposed to be used to report performance and progress on the SDGs. Progress reporting helps measure progress against peers and implement targeted measures to improve performance.

 

*This article is part of an ongoing series on ESG (Environmental, Social and Governance) in Kenya by Dr. Kariuki Muigua, PhD, Kenya’s ADR Practitioner of the Year 2021 (Nairobi Legal Awards), ADR Publisher of the Year 2021 and ADR Lifetime Achievement Award 2021 (CIArb Kenya). Dr. Kariuki Muigua is a foremost Environmental Law and Natural Resources Lawyer and Scholar, Sustainable Development Advocate and Conflict Management Expert in Kenya. Dr. Kariuki Muigua is a Senior Lecturer of Environmental Law and Dispute resolution at the University of Nairobi School of Law and The Center for Advanced Studies in Environmental Law and Policy (CASELAP). He has published numerous books and articles on Environmental Law, Environmental Justice Conflict Management, Alternative Dispute Resolution and Sustainable Development. Dr. Muigua is also a Chartered Arbitrator, an Accredited Mediator, the Africa Trustee of the Chartered Institute of Arbitrators and the Managing Partner of Kariuki Muigua & Co. Advocates. Dr. Muigua is recognized as one of the leading lawyers and dispute resolution experts by the Chambers Global Guide 2022. 

 

References

NSE, “ESG Disclosures Guidance Manual,” November 2021; Available at: https://sseinitiative.org/wp-content/uploads/2021/12/NSE-ESG-Disclosures-Guidance.pdf(accessed on 10/02/2022).

[1] Global Reporting Initiative (GRI), “Integrating SDG in Sustainability Reporting,” Available at: https://www.globalreporting.org/public-policy-partnerships/sustainable-development/integrating-sdgs-into-sustainability-reporting/(accessed on 10/02/2022).

[2] Huber, B.M. et al, “UN Sustainable Development Goals-The Leading ESG Framework for Large Companies,” Harvard Law School Forum on Corporate Governance, available at: https://corpgov.law.harvard.edu/2018/10/04/ un-sustainable-development-goals-the-leading-esg-framework-for-large-companies/(accessed on 10/02/2022).

[3] Source Intelligence, “What are the 17 UN SDGs and Why Do They Matter for ESG,” March 11, 2021, Available at: https://blog.sourceintelligence.com/un-sdgs-esg (accessed on 10/02/2022).

[4] Ibid.

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Climate Finance Beyond COP 28: Introducing Loss and Damage Fund

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By Hon. Prof. Kariuki Muigua, OGW, PhD, C.Arb, FCIArb is a Professor of Environmental Law and Dispute Resolution at the University of Nairobi, Member of Permanent Court of Arbitration, Leading Environmental Law Scholar, Respected Sustainable Development Policy Advisor, Top Natural Resources Lawyer, Highly-Regarded Dispute Resolution Expert and Awardee of the Order of Grand Warrior (OGW) of Kenya by H.E. the President of Republic of Kenya. He is The African ADR Practitioner of the Year 2022, The African Arbitrator of the Year 2022, ADR Practitioner of the Year in Kenya 2021, CIArb (Kenya) Lifetime Achievement Award 2021 and ADR Publisher of the Year 2021 and Author of the Kenya’s First ESG Book: Embracing Environmental Social and Governance (ESG) tenets for Sustainable Development” (Glenwood, Nairobi, July 2023) and Kenya’s First Two Climate Change Law Book: Combating Climate Change for Sustainability (Glenwood, Nairobi, October 2023), Achieving Climate Justice for Development (Glenwood, Nairobi, October 2023) and Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024)*

Climate finance refers to local, national, regional, continental and global financing of public and private investment that seeks to support mitigation of and adaptation to climate change. Climate finance has also been defined as finance for activities aimed at mitigating or adapting to the impacts of climate change. The United Nations defines climate finance as local, national or transnational financing drawn from public, private and alternative sources of financing that seeks to support mitigation and adaptation actions that will address climate change. Climate finance can therefore be understood as the flow of funds to all activities, programmes or projects intended to help address climate change through both mitigation and adaptation across the world.

Climate finance is very essential in enhancing the global response to climate change. Climate finance is needed for mitigation, because large-scale investments are required to significantly reduce emissions. Further, climate finance is equally important for adaptation, as significant financial resources are needed to adapt to the adverse effects and reduce the impacts of climate change. Climate finance is therefore necessary in combating climate change since the adaptation and mitigation processes vital in enhancing national, regional and global response to climate change require funding.

The concept of climate finance is premised on the principle of ‘common but differentiated responsibility and respective capabilities’ which calls upon developed countries to provide financial resources to assist developing countries to respond to climate change. The principle of common but differentiated responsibility and respective capabilities has been embraced under the United Nations Framework Convention for Climate Change (UNFCCC)9 and the Paris Agreement which urge developed countries to take the lead in mobilizing and unlocking climate finance.This principle recognizes that the contribution of countries to climate change and their capacity to prevent it and cope with its consequences vary enormously.

The Loss and Damage Fund was launched at the 2022 United Nations Climate Change Conference/ Conference of the Parties of the UNFCCC (COP 27) when parties agreed to set up funding arrangements for responding to loss and damage associated with the adverse effects of climate change, including a focus on addressing loss and damage. The objective of the Loss and Damage Fund is to establish new funding arrangements for assisting developing countries that are particularly vulnerable to the adverse effects of climate change, in responding to loss and damage, including with a focus on addressing loss and damage by providing and assisting in mobilizing new and additional resources, and that these new arrangements complement and include sources, funds, processes and initiatives under and outside the UNFCCC and the Paris Agreement.

The COP 27 decision also stipulates ways of operationalizing the Loss and Damage Fund including establishing institutional arrangements, modalities, structure, governance and terms of reference for the fund, defining the elements of the new funding arrangements, identifying and expanding sources of funding and ensuring coordination and complementarity with existing funding arrangements. It further establishes a Transitional Committee to operationalize the new funding arrangements for responding to loss and damage and the associated fund. The Committee made recommendations based on, inter alia, elements for operationalization of the Loss and Damage Fund for consideration and adoption by the Conference of the Parties at COP 28.

According to the United Nations Environment Programme (UNEP), the establishment of the Loss and Damage Fund was the culmination of decades of pressure from climate-vulnerable developing countries. UNEP observes that the fund aims to provide financial assistance to nations most vulnerable and impacted by the effects of climate change. It has been asserted that the Loss and Damage Fund acknowledges that climate change has caused widespread adverse impacts and related losses and damages to nature and people beyond natural climate variability.

The United Nations points out that some development and adaptation efforts have reduced climate vulnerability, but the rise in weather and climate extremes has led to some irreversible impacts as natural and human systems are pushed beyond their ability to adapt. Loss and damage arising from the adverse impacts of climate change can include those related to extreme weather events but also slow onset events, such as sea level rise, increasing temperatures, ocean acidification, glacial retreat and related impacts, salinization, land and forest degradation, loss of biodiversity and desertification.

According to UNEP, loss and damage refers to the negative consequences that arise from the unavoidable risks of climate change, like rising sea levels, prolonged heatwaves, desertification, the acidification of the sea and extreme events, such as bushfires, species extinction and crop failures. The Loss and Damage Fund has been hailed as an important milestone in the climate justice agenda. The concept of climate justice acknowledges that climate change has had uneven and unequal burdens across the globe with nations and communities that contribute the least to climate change suffering the most from its consequences.

It has correctly been pointed out that some countries mainly the large industrialised economies of Europe and North America have benefitted much more from the industries and technologies that cause climate change than have developing nations in places such as Africa, Asia, the Caribbean Islands and the Pacific Islands which due to an unfortunate mixture of economic and geographic vulnerability, continue to shoulder the brunt of the burdens of climate change despite their relative innocence in causing it. The impacts of climate change including extreme flooding, intense droughts, rising sea levels, and unpredictable weather damage are more severe in developing countries resulting in both economic and non-economic loss and damage including loss of lives, damage to infrastructure and displacement of people.

Climate justice focuses on how climate change impacts people differently, unevenly and disproportionately and seeks to address the resultant injustices in fair and equitable way. The Loss and Damage has been hailed for recognizing the injustices caused by climate change whose impacts are more severe in developing countries. It has been described as a response to the climate injustice and climate debt, owed by the developed countries to the developing countries. It aims to help developing nations deal with loss and damage resulting from the effects of climate change.

The Loss and Damage Fund is therefore important in the climate finance agenda. It has been asserted that the establishment of the Loss and Damage Fund will add a third pillar to the global climate finance landscape which will now comprise of mitigation (funding to reduce emissions), adaptation (funding to minimize the negative impacts of emissions) and loss and damage (funding to address the harms caused by emissions). The Loss and Damage Fund will help vulnerable nations to rebuild the necessary physical and social infrastructure to deal with the negative consequences that arise from the unavoidable risks of climate change including rising sea levels, extreme heat waves, desertification, forest fires and crop failures. Further, it has been argued that the Loss and Damage Fund will help governments rebuild homes, hospitals and roads, avoid new debt burdens, and provide social protection to help communities bridge crises and avoid incidences of poverty after climate disasters.

The Loss and Damage Fund is therefore important since its establishment will expand the climate finance landscape. However, operationalization of the Loss and Damage Fund is likely to face several hurdles. Among the key concerns is the ability of the Fund to meet the urgent and immediate need for new, additional, predictable and adequate financial resources while ensuring that existing development and climate financing for other priorities is not diverted. It has been argued that there is a real danger that the supposed ‘new and additional’ funding will not be new and additional at all since it will simply be drawn from existing aid budgets and taken from other areas thus hindering other climate change priority areas including mitigation and adaptation.

In addition, there are unresolved questions over who will provide finance and which countries will receive it. There have been suggestions that the Fund should be drawn from developed countries which have an obligation to fulfill their climate finance commitments in accordance with the principle of common but differentiated responsibility and respective capabilities while others have suggested that there is need to find new, scaled up sources of funding such as innovative ‘polluter pays’ style instruments levied at a national level, such as a national carbon tax, and that high emitting industries could also contribute to the Fund.

It has been asserted there is no clarity over where the Loss and Damage Fund will be drawn from and how the Fund will be aligned with existing UNFCCC funds. It is further not clear whether all developing countries will be beneficiaries of the Fund or only those that are highly vulnerable to the impacts of climate change. It is therefore imperative to define the scope of the Loss and Damage Fund in order to enhance its effectiveness. Finally, there are concerns over efficiency of the Loss and Damage Fund in providing much needed climate finance to countries affected by climate disasters.

Existing climate finance institutions and funds, such as the Green Climate Fund and the Adaptation Fund, often have elaborate application processes, and take years to distribute funds. It has been argued that establishing the Fund under existing entities within the UNFCCC such as the Green Climate Fund is likely to encumber the Loss and Damage Fund with the institutional, legal, and procedural challenges that have plagued other existing funds and thus prevent vulnerable countries from expeditious access to funds needed to address loss and damage related to climate change. Further, it has also been argued that establishing the Fund as a new entity under the financial mechanisms of the UNFCCC will result in further fragmentation of the climate finance landscape.

The current environment of climate finance is now dispersed across dozens of multilateral and bilateral providers, each with their own requirements, procedures and processes a situation which places significant burden on vulnerable countries who find it difficult to access finance. It is therefore imperative to address the foregoing concerns in order to ensure the efficacy and efficiency of the Loss and Damage Fund and fulfill its objective of assisting developing countries that are particularly vulnerable to the adverse effects of climate change in responding to loss and damage that arises from the impacts of climate change.

*This is an extract from the Book: Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024) by Hon. Prof.  Kariuki Muigua, OGW, PhD, Professor of Environmental Law and Dispute Resolution, Senior Advocate of Kenya, Chartered Arbitrator, Kenya’s ADR Practitioner of the Year 2021 (Nairobi Legal Awards), ADR Lifetime Achievement Award 2021 (CIArb Kenya), African Arbitrator of the Year 2022, Africa ADR Practitioner of the Year 2022, Member of National Environment Tribunal (NET) Emeritus (2017 to 2023) and Member of Permanent Court of Arbitration nominated by Republic of Kenya. Prof. Kariuki Muigua is a foremost Environmental Law and Natural Resources Lawyer and Scholar, Sustainable Development Advocate and Conflict Management Expert in Kenya. Prof. Kariuki Muigua teaches Environmental Law and Dispute resolution at the University of Nairobi School of Law, The Center for Advanced Studies in Environmental Law and Policy (CASELAP) and Wangari Maathai Institute for Peace and Environmental Studies. He has published numerous books and articles on Environmental Law, Environmental Justice Conflict Management, Alternative Dispute Resolution and Sustainable Development. Prof. Muigua is also a Chartered Arbitrator, an Accredited Mediator, the Managing Partner of Kariuki Muigua & Co. Advocates and Africa Trustee Emeritus of the Chartered Institute of Arbitrators 2019-2022. Prof. Muigua is a 2023 recipient of President of the Republic of Kenya Order of Grand Warrior (OGW) Award for his service to the Nation as a Distinguished Expert, Academic and Scholar in Dispute Resolution and recognized among the top 5 leading lawyers and dispute resolution experts in Band 1 in Kenya by the Chambers Global Guide 2022 and was listed in the Inaugural THE LAWYER AFRICA Litigation Hall of Fame 2023 as one of the Top 50 Most Distinguished Litigation Lawyers in Kenya and the Top Arbitrator in Kenya in 2023.

References

Anderson. K., ‘What is the COP 27 Loss and Damage Fund?’ Available at https://greenly.earth/en-us/blog/company-guide/what-is-the-cop27-loss-anddamage-fund (Accessed on 25/12/2023).

Climate Finance., ‘Climate Finance Essential for Mitigating and Adapting to Climate Change.’ Available at https://www.iberdrola.com/sustainability/what-is-climatefinance (Accessed on 25/12/2023).

Giles. M., ‘The Principles of Climate Justice at CoP27.’ Available at https://earth.org/principlesofclimatejustice/#:~:text=That%20response%20should%20be%20based,the%20conse quences%20of%20clim ate%20change (Accessed on 25/12/2023).

Hill. A.,& Babin. M ‘Why Climate Finance is Critical for Accelerating Global Action.’ Available at https://www.cfr.org/in-brief/why-climate-finance-critical-acceleratingglobal-action (Accessed on 25/12/2023).

Hong. H., Karolyi. G. A., & Scheinkman. J.A., ‘Climate Finance.’ Review of Financial Studies, Volume 33, Issue 3 (2020).

Muigua. K., ‘Unlocking Climate Finance for Development.’ Available at https://kmco.co.ke/wp-content/uploads/2023/08/Unlocking-Climate-Finance-forDevelopment.pdf (Accessed on 25/12/2023).

Paris Agreement., Available at https://unfccc.int/sites/default/files/english_paris_agreement.pdf (Accessed on 25/12/2023).

Reliefweb., ‘A Loss and Damage Fund: Two Big Challenges.’ Available at https://reliefweb.int/report/world/loss-and-damage-fund-two-big-challenges (Accessed on 18/09/2023).

Rumble. O, & Gilder. A., ‘Who, What, Where? The Loss and Damage Fund’s Unresolved Questions.’ https://africanarguments.org/2023/07/who-what-wherethe-loss-and-damage-funds-unresolved-questions/ (Accessed on 19/09/2023).

Sultana. F., ‘Critical Climate Justice’ Available at https://www.farhanasultana.com/wpcontent/uploads/Sultana-Critical-climatejustice.pdf (Accessed on 25/12/2023).

The London School of Economics and Political Science., ‘What is Climate Finance?’ Available at https://www.lse.ac.uk/granthaminstitute/explainers/what-is-climatefinance-and-where-will-itcomefrom/ (Accessed on 25/12/2023).

UNFCCC., ‘Decision -/CP.27 -/CMA.4: Funding Arrangements for Responding to Loss and Damage Associated with the Adverse Effects of Climate Change, Including a Focus on Addressing Loss and Damage.’ Available at https://unfccc.int/sites/default/files/resource/cma4_auv_8f.pdf (Accessed on 25/12/2023).

United Nations Climate Change., ‘Introduction to Climate Finance.’ Available at https://unfccc.int/topics/introduction-to-climate-finance (Accessed on 25/12/2023).

United Nations Climate Change., ‘Introduction to Climate Finance.’ Op Cit 9 United Nations Framework Convention on Climate Change., Available at https://unfccc.int/files/essential_background/background_publications_htmlpdf/ application/pdf/con veng.pdf (Accessed on 25/12/2023).

United Nations Climate Change., ‘Loss and Damage.’ Available at https://unfccc.int/topics/adaptation-and-resilience/the-bigpicture/introduction#loss-and-damage (Accessed on 25/12/2023).

United Nations Climate Change., ‘Operationalization of the New Funding Arrangements, including a Fund, for Responding to Loss and Damage referred to in Paragraphs 2–3 of Decisions 2/CP.27 and 2/CMA.4.’ Available at https://unfccc.int/documents/636558 (Accessed on 25/11/2023).

United Nations Environment Programme., ‘What you Need to Know about the COP 27 Loss and Damage Fund.’ Available at https://www.unep.org/news-andstories/story/what-you-need-know-about-cop27-loss-and-damage-fund (Accessed on 25/12/2023).

Wyns. A., ‘COP 27 Establishes Loss and Damage Fund to Respond to Human Cost of Climate Change.’ The Lancet Planetary Health, Volume 7, Issue 1 (2023).

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Green and Sustainable Procurement in Kenya

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By Hon. Prof. Kariuki Muigua, OGW, PhD, C.Arb, FCIArb is a Professor of Environmental Law and Dispute Resolution at the University of Nairobi, Member of Permanent Court of Arbitration, Leading Environmental Law Scholar, Respected Sustainable Development Policy Advisor, Top Natural Resources Lawyer, Highly-Regarded Dispute Resolution Expert and Awardee of the Order of Grand Warrior (OGW) of Kenya by H.E. the President of Republic of Kenya. He is The African ADR Practitioner of the Year 2022, The African Arbitrator of the Year 2022, ADR Practitioner of the Year in Kenya 2021, CIArb (Kenya) Lifetime Achievement Award 2021 and ADR Publisher of the Year 2021 and Author of the Kenya’s First ESG Book: Embracing Environmental Social and Governance (ESG) tenets for Sustainable Development” (Glenwood, Nairobi, July 2023) and Kenya’s First Two Climate Change Law Book: Combating Climate Change for Sustainability (Glenwood, Nairobi, October 2023), Achieving Climate Justice for Development (Glenwood, Nairobi, October 2023) and Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024)*

Green and sustainable procurement is at the heart of the United Nation’s 2030 Agenda for Sustainable Development36. Sustainable Development Goal (SDG) 12 seeks to foster sustainable consumption and production patterns in all countries. One of the targets under SDG 12 is to promote public procurement practices which are sustainable, in accordance with national policies and priorities. It has been argued that green and sustainable public procurement can influence the attainment of nearly all the SDGs. It can enhance the acquisition of green and sustainable products and services that are crucial in realizing the SDGs in areas such as food security, health, education, energy, clean water and sanitation, and infrastructure.

Green and sustainable public procurement can also positively influence SDG 13 (taking urgent action to combat climate change) by ensuring that environmental considerations such as energy and water efficiency are included in tenders for products or services. According to the United Nations Environment Programme (UNEP), leveraging the enormous purchasing power wielded by public procurement, which is estimated to be 12% of GDP in developed countries and up to 30 % of GDP in developing countries, by promoting public procurement practices that are green and sustainable, in accordance with national policies and priorities, plays a key role in achieving Sustainable Consumption and Production (SDG 12) and in addressing the three pillars of Sustainable Development.

From an environmental perspective; sustainable procurement allows governments to reduce greenhouse gas emissions, improve resource efficiency and support recycling; from a social dimension, the positive social results of green and sustainable procurement include poverty reduction, improved equity and respect for core labour standards; from an economic perspective, green and sustainable procurement can generate income, reduce costs, support the transfer of skills and technology and promote innovation by domestic producers. UNEP further asserts that shifting public spending towards more green and sustainable goods and services can help drive markets in the direction of innovation and sustainability, thereby enabling the transition to a green economy and achievement of the Sustainable Development agenda.

Green and sustainable public procurement is therefore integral in the sustainable development agenda. At the continental level, the Africa Union’s Agenda 2063 also embraces the role of green and sustainable procurement in the realization of the vision of an integrated, prosperous and peaceful Africa, driven by its own citizens and representing a dynamic force in the international arena. One of the key aspirations of Agenda 2063 is fostering environmentally sustainable and climate resilient economies and communities in Africa. Agenda 2063 identifies the need for sustainable consumption and production patterns in the realization of this aspiration and urges all African countries to develop and implement policies and standards including environmental laws and regulations and green procurement for sustainable production and consumption practices.

Promoting green and sustainable procurement is vital in the realization the vision of Agenda 2063. At the national level, the Constitution of Kenya enshrines Sustainable Development as one of the national values and principles of governance which binds all state organs, state officers, public officers and all persons. The Constitution therefore envisions the procurement process in Kenya to be guided by the principles of Sustainable Development. The Constitution further requires the procurement of public goods and services to be done in accordance with a system that is fair, equitable, transparent, competitive and cost-effective.

The Public Procurement and Asset Disposal Act was enacted to give effect to Article 227 of the Constitution on procurement of public goods and services; to provide procedures for efficient public procurement and for assets disposal by public entities; and for connected purposes. The Act requires public procurement and asset disposal by state organs and public entities in Kenya to be guided by certain values and principles including the national values and principles provided for under Article 10 of the Constitution; maximisation of value for money; and promotion of local industry, Sustainable Development and protection of the environment. The Act therefore embraces the ideas of green and sustainable procurement by requiring environment and Sustainable Development considerations to guide the procurement process in Kenya.

In particular, the Act requires the procurement of public goods and services in Kenya to comply with specific requirements aimed at promoting green and sustainable procurement. It provides that an accounting officer of a procuring entity shall prepare specific requirements relating to the goods, works or services being procured that are clear, that give a correct and complete description of what is to be procured and that allow for fair and open competition among those who may wish to participate in the procurement proceedings. Such requirements include the need to factor in the socioeconomic impact of the goods, works and services; the need for goods, works and services to be environment-friendly; and cost effectiveness of goods, works and services.

In addition, the Public Procurement and Asset Disposal Regulations also seek to promote green and sustainable procurement in Kenya. The Regulations require user departments in procurement entities while submitting requisitions to the head of the procurement function for processing, to ensure that the requisitions are accompanied by, inter alia, as applicable: environmental and social impact assessment reports. The Regulations further provide that the documents, procedures and approvals required for waste disposal management shall be obtained from the relevant public agencies allowing a procuring entity to dispose those items that are harmful and unfriendly to the environment.

It has correctly been pointed out that there is need for all public entities in Kenya to uphold the provisions of the Public Procurement and Asset Disposal Act and the Public Procurement and Asset Disposal Regulations and work towards ensuring that both the processes of procurement of goods and disposal of waste are not only environmentally friendly but are also cost effective and contribute towards the realization of the Sustainable Development agenda in Kenya. Despite the appropriateness of green and sustainable procurement, it has been observed that the concept is yet to be fully embraced in developing countries like Kenya in both the private and public sectors.

It has been noted that the adoption of green and sustainable procurement in Kenya has been slow resulting in lower diffusion rate in Kenya. In addition, it has been argued that in as much as the government and other stakeholders may want to promote green and sustainable procurement in Kenya as demonstrated by the enactment of laws such as the Public Procurement and Asset Disposal Act, some organizations may be reluctant given that they see an opportunity in non-conformance. Organizations may shun away from green and sustainable procurement due to factors such as perceived added costs involved, poor management practices, poor policy communication, limited established environmental and sustainability criteria for products and services, lack of practical tools and information, and lack of clear interpretation of the concept of green and sustainable procurement.

There is need to promote green and sustainable procurement in Kenya in order to foster Sustainable Development. Green and sustainable public procurement also offers numerous benefits for both the public and private sector including enhanced economic performance, competitive advantage through innovation, improved public image, lower waste management costs, energy and resources conservation, and risk reduction among others.

*This is an extract from the Book: Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024) by Hon. Prof.  Kariuki Muigua, OGW, PhD, Professor of Environmental Law and Dispute Resolution, Senior Advocate of Kenya, Chartered Arbitrator, Kenya’s ADR Practitioner of the Year 2021 (Nairobi Legal Awards), ADR Lifetime Achievement Award 2021 (CIArb Kenya), African Arbitrator of the Year 2022, Africa ADR Practitioner of the Year 2022, Member of National Environment Tribunal (NET) Emeritus (2017 to 2023) and Member of Permanent Court of Arbitration nominated by Republic of Kenya. Prof. Kariuki Muigua is a foremost Environmental Law and Natural Resources Lawyer and Scholar, Sustainable Development Advocate and Conflict Management Expert in Kenya. Prof. Kariuki Muigua teaches Environmental Law and Dispute resolution at the University of Nairobi School of Law, The Center for Advanced Studies in Environmental Law and Policy (CASELAP) and Wangari Maathai Institute for Peace and Environmental Studies. He has published numerous books and articles on Environmental Law, Environmental Justice Conflict Management, Alternative Dispute Resolution and Sustainable Development. Prof. Muigua is also a Chartered Arbitrator, an Accredited Mediator, the Managing Partner of Kariuki Muigua & Co. Advocates and Africa Trustee Emeritus of the Chartered Institute of Arbitrators 2019-2022. Prof. Muigua is a 2023 recipient of President of the Republic of Kenya Order of Grand Warrior (OGW) Award for his service to the Nation as a Distinguished Expert, Academic and Scholar in Dispute Resolution and recognized among the top 5 leading lawyers and dispute resolution experts in Band 1 in Kenya by the Chambers Global Guide 2022 and was listed in the Inaugural THE LAWYER AFRICA Litigation Hall of Fame 2023 as one of the Top 50 Most Distinguished Litigation Lawyers in Kenya and the Top Arbitrator in Kenya in 2023.

References

Africa Union., ‘Agenda 2063: The Africa we Want.’ Available at https://au.int/sites/default/files/documents/33126-docframework_document_book.pdf (Accessed on 21/12/2023).

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Wanyama: Huduma Kiosks Reflection of Current LSK Lazy Approach

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Peter Manyonge Wanyama [PMO], Law Society of Kenya President Candidate 2024-2026

Statement of Peter Wanyama, Advocate on Huduma Centre Judiciary Kiosks and Lazy LSK Approach:-

From the recent revelation, it is patently clear that LSK Council knew about the proposals to establish Huduma legal kiosks more than 1 year ago but was crassly negligent in addressing the issue and protecting practice. How can such a major development pass the leadership of the LSK ? Why call for public participation after the Huduma kiosks have already been set up ? The best solution NOW is to shut down those kiosks and FORCE the NCAJ and the Chief Justice to address concerns of practitioners.

On another note, the problem reflects a leadership deficit at LSK. Our practicing space is being encroached by non-qualified persons and yet our leaders are NOT aggressive enough. This hurts me to the core. Seems that our leaders at LSK and are more concerned about the quality of juice they take in Council meetings and can issue the CEO of LSK a Notice to Show Cause for refusal to carry a personal handbag- than aggressively pushing the concerns of practitioners and protecting.

I take the firm view that LSK leaders should be persons who are capable of assessing the entire policy and legal landscape, sometimes preemptively- to monitor risks to legal practice and doing what it takes to protect it. We must be aggressive in protecting practice the same way we push for the rule law and constitutionalism. Conceivably, you can’t demostrate in the streets to protect the rule of law when you are hungry. In sum, we need freshness at the LSK. I undertake to be your consequential, pushy, and strategic LSK President. I will lead a Council that protects practice without creating EXCUSES. Under my tenure- we wont accept anything that threatens practice.

THE WAY FORWARD ON HUDUMA KIOSKS

Huduma kiosks have now been implemented. The CJ says they soon be rolled out in all parts of Kenya. From a legal risk analysis- judges are likely to delay hearing any Petition challenging the Huduma kiosks because of the constitutional doctrine of access to justice as fortified in the Kituo Cha Sheria case yet the concerns of the practitioners are beyond this. Practitioners are concerned about the consequences of the implementation of the Huduma kiosks- especially them being potential fertile grounds that take away work from lawyers. Moreover, the kiosks will undoubtedly provide fodder for quacks, and clerks to practice law.

To me, we need tactics beyond litigation. Can we force the NCJA and CJ to halt the kiosks pending consultation with LSK members? At Kisumu, the Huduma center is not more than 400 meters away from the Law Courts- is this really about access to justice ? There are so many law courts in rural Kenya; why cant we establish Access- to- Justice- Shops in those law courts ? Where is the Concept Note that provides the rationale for these Huduma Kiosks ? Can it be shared with practitioners for input and feedback? Why the hurry to set up the Huduma kiosks ? What is really going on? I maintain, that we MUST shut down those kiosks until our concerns are addressed. Remember, this is a bread and butter issue. Let us not play around with our practicing space !

For more details: Peter Manyonge Wanyama [PMO] LSK Presidency 2024 Manifesto

Peter Manyonge Wanyama [ PMO]
LSK Presidential Candidate 2024.

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