Janitorial Services-ESG
ESG Overview
Environmental, social and governance (ESG) criteria are three categories of non-financial performance indicators that can be used to better understand material risks and opportunities within an organisation across each of these categories. CBRE Procurement defines ESG as: (E) de-carbonising the supply chain and environmental risk, (S) supplier diversity, and (G) responsible sourcing, as detailed below when unpacking Environmental, Social and Governance considerations.
Ver 1.0 (Jun 22)
Janitorial Services - ESG
Environment
There are several initiatives that can be undertaken by CBRE suppliers to minimise environmental degradation and excess carbon emissions.
Suppliers should be considering:
- Business process efficiencies to reduce staff travel between sites
- Adoption of biodegradable and environmentally friendly chemicals
- Power efficient cleaning equipment
- Water efficient cleaning equipment
- Training staff to minimise environmental impact and resource use through their cleaning techniques
- Ways to maximise adoption of recycling and landfill diversion schemes
Social
Janitorial Services offers opportunities to engage diverse suppliers, social enterprises, and drive local skills development.
Suppliers should be considering:
- Using diverse suppliers and subcontractors, where possible
- Creating local apprenticeship opportunities and employment opportunities for people from disadvantaged backgrounds
- Using local parts suppliers and manufactures where possible (i.e. cleaning consumables)
- Supporting programs to improve health, safety and wellness
Governance
Janitorial Services and its supply chain represent significant governance risks, especially in the area of modern slavery and safety.
Suppliers should be considering:
- Fair pay and benefits for all cleaning staff
- How to consistently manage subcontractors to address modern slavery and labour rights risk
- Health and Safety procedures
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Confidential & Proprietary | 2022 CBRE, Inc.
For information on ESG, how to identify ESG risk, and ESG templates and guides
Janitorial Services can create material ESG risks and opportunities, so it is important that this category is proactively managed from this perspective.
Janitorial Services-ESG
ESG Bids
Janitorial Services - Bids
RFPs are a crucial part of the procurement process that enable CBRE to assess the ESG capabilities and credentials of our potential suppliers. ESG sections must be used in all procurements and should be weighted between 5% and 20% depending on the procurement and its relative sustainability risk.
For more information on embedding ESG into RFP’s, including CBRE’s standard ESG RFP templates
For the Janitorial Services RFP template for download
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Ver 1.0 (Jun 22)
Confidential & Proprietary | 2022 CBRE, Inc.
Janitorial Services-ESG
ESG Contracting
Janitorial Services - Contracting
Ensuring suppliers are contractually obliged to achieve our ESG expectations is a key tool to help us achieve our ESG goals. The following model contract clause should be used in all procurements, however, it can be adapted and updated to reflect the unique ESG considerations of a particular industry, procurement, or supplier. However, guidance should be sought from the ESG Procurement Team and relevant legal support.
Procurement managers must ensure that the following clause is included in all new supplier contracts:
Environment, Social, and Governance (ESG). The Service Provider shall make reasonable efforts to minimize negative and maximize positive ESG impacts created in the delivery of goods and/or services to CBRE and foresee any known or expected future changes in ESG regulations or requirements.
Service Provider shall adopt an ESG policy, with supporting procedures, to ensure that it adheres with ESG requirements and best practice. Each year, Service Provider will provide CBRE a report outlining how the Service provider:
1. Is managing important ESG matters
2. Is identifying what further action (if any) should be taken
3. Has improved in its implementation of the ESG Policy so far
4. Will improve its performance further and propose at least two new options for improvements to CBRE and our Clients
CBRE may occasionally request other information regarding developments in ESG best practice, requirements, policies, or procedures, which the Service Provider must promptly comply with. If any breach of ESG policy or requirements has occurred; Service Provider shall proactively and promptly inform CBRE.
In addition to the foregoing, and as may be amended by a set of KPI’s agreed upon by the Parties, the Service Provider further commits to the following ESG obligations:
a. Environment
1. With regards to carbon emissions, Supplier must provide the following data every 6 months:
a. Scope 1: Direct emissions from Supplier owned or controlled sources (e.g., emissions that are emitted on-site or by vehicles owned or controlled)
b. Scope 2: Indirect emissions from the generation of purchased energy (e.g., energy)
c. Scope 3: All other indirect emissions not included in Scope 1 and 2 that occur in the value chain of the Supplier, including both upstream and downstream emissions. (e.g., all emissions generated suppliers, middle-men, and consumers of a product or service that aren’t accounted for in the first two scopes)
2. With regard to the foregoing Scope, Supplier commits achieve the following outcomes (“Expected Outcome”):
a. Reduce annual energy consumption by __ %, waste by ___ % and water by ___ %;
b. Provide reliable quarterly reporting of energy consumption; and
c. Propose quarterly sustainability initiatives.
b. Social
1. Service Provider shall, to the extent it is not a diverse company being at least a 51%-owned, managed, and controlled by an underrepresented group (“Diverse Supplier”), adopt a Supplier Diversity Program, including the ability to identify the Service Provider’s Diverse Suppliers, monitor spend, develop existing Diverse Suppliers, and add new Diverse Suppliers. Service Provider should set annual targets to achieve 20% Diverse Supplier spend
2. Supplier shall participate in CBRE’s Tier 2 Diverse Supplier Program, including:
a. provide CBRE with a 2nd Tier Supplier Diversity Participation Plan by December 1 of each year, outlining Service Provider’s success and challenges over the previous year and plans to achieve 20% diverse spend in the coming year
b. Submit quarterly Diversity Results Reports, outlining the spend with all Diverse Suppliers both direct and indirect by the 15-day following the close of each quarter, electronically into CBRE’s Tier 2 reporting portal, or via another mutually agreed format.
c. Governance
1. Service Provider will adhere to CBRE’s Supplier Code of Conduct and manage Service Providers supply chain in accordance with its requirements. Service Provider must understand the inherent governance risks in providing their products and or services to CBRE and CBRE Clients and work with CBRE and CBRE’s recommended service providers to offset the i inherent risks such as compliance, health and safety, cyber security, modern slavery and so on.
2. Service Provider must register, if not already registered, in CBRE’s ESG compliance tools, including Supplier Shield (CBRE’s global due diligence platform) and EcoVadis (CBRE’s third party sustainability performance management tool), with costs to be borne by Service Provider but not more than US$3,000 per annum.
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Ver 1.0 (Jun 22)
Confidential & Proprietary | 2022 CBRE, Inc.
Janitorial Services-ESG
Transitions and Supplier Management
Janitorial Services - Transitions and Supplier Management
Once onboarded, suppliers must be actively managed to ensure they meet their contractual and promised ESG goals and standards.
Managing existing suppliers
For more information on embedding ESG into supplier management procedures, including CBRE’s standard templates
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What to communicate to your supplier
Procurement managers are encouraged to actively engage and communicate with their suppliers. Particularly, when having a review of your suppliers, make sure you are relaying the following message:
If you [supplier] provide high quality services and/or products and collaborate to achieve our ESG goals and ambitions, by hitting your ESG KPIs, you will improve the likelihood of building a long term preferred or strategic partnership. As a result, CBRE would assist you in growing your business with clients who are also ESG focused. We would do this by:
- Providing you access to our procurement and ESG tools and resources.
- Promoting your products/services internally with budget holders, and with clients.
- Assisting you in gaining competitive opportunities to grow your business to offset the potential increase in costs and efforts associated with ESG related activities
Q&A – What to do if your supplier has any issues or queries
The following is a list of typical questions or issues your suppliers may have for you when you discuss the new ESG requirements CBRE is implementing, along with suggested responses.
Supplier does not want to commit to ESG requirements:
Choosing not to commit to CBRE’s ESG requirements would go against CBRE’s net zero commitment for 2040, our Supplier Cide of Conduct, our ESG contract clause, and our client’s expectations. This creates ESG risk for CBRE and its clients – for example, this could lead to CBRE needing to pay extra to offset emissions associated with your activity and your product/service. This would lead to a higher cost of business with you as a vendor and will endanger a longer-term relationship with your organisation.
Supplier does not want to sign up to EcoVadis or the sustainability assessment platform:
EcoVadis is an easy way for you to start on your sustainability journey, giving you and your clients visibility over your ESG maturity and risks. If you are already underway in your sustainability journey, EcoVadis would help you benchmark your organisation against other suppliers and competitors. CBRE uses Ecovadis assessments of our suppliers as the baseline of supplier sustainability journey. We require our suppliers to build up to date profiles in EcoVadis so that we can advise our clients that we are working on making sure we have a more sustainable supply chain with lower risks and is more fit for purpose.
Supplier does not want to pay to sign up to EcoVadis:
We understand there is a small cost associated with signing up, but this will help you better align with our sustainability journey and objectives, which means we would be able to continue doing business with you. EcoVadis is fast becoming an industry standard, with many of your large existing or potential clients using the platform – so the effort you put into building your profile for CBRE can be leveraged for other business relationships.
Supplier does not understand what scope 1, 2 and/or 3 emissions are:
A company’s GHG emissions is generally classified into three “scopes”:
- Scope 1: Direct emissions from Supplier owned or controlled sources (e.g., emissions that are emitted on-site or by vehicles owned or controlled)..
- Scope 2: Indirect emissions from the generation of purchased energy (e.g., energy).
- Scope 3: All other indirect emissions not included in Scope 1 and 2 that occur in the value chain of the Supplier, including both upstream and downstream emissions. (e.g., all emissions generated suppliers, middle-men, and consumers of a product or service that aren’t accounted for in the first two scopes). This includes emissions associated with purchased goods and services, capital goods, transportation and distribution, waste generated in operations, business travel, employee commute, leased assets, processing of sold products, use of sold products, end-of-life treatment of sold products, franchises, and investments.
Supplier does not meet one or more of the required ESG KPIs (e.g., supplier does not have a Modern Slavery commitment):
We understand that you may be at the beginning of your sustainability journey, and therefore you do not currently meet this requirement. CBRE encourages all our suppliers to disclose plans to develop [KPI] to meet the requirement by next year. In the interim, please provide us with a declaration of conformity (written self-claim) on this subject/those subjects.
CBRE is building resources to assist you to build out a full suite of ESG policies and processes that meet our expectations. Please engage with our ESG sustainability team to find out more. Procurement managers should provide equal opportunities for improvement and education on behalf of the supplier. If suppliers do not comply or refuse to collaborate and/or comply after their issues have been addressed (see FAQS above), procurement managers may be required to terminate or choose not to renew expiring contracts and seek alternative suppliers.
Ver 1.0 (Jun 22)
Confidential & Proprietary | 2022 CBRE, Inc.
Janitorial Services suppliers must have KPIs and expectations aligned to the specific contract and the questions in the RFP. The following is a set of supplier expectations aligned to the standard CBRE Janitorial Services ESG RFP template