The European Union requires that Contracting Authorities, Tenderers and Candidates observe the highest ethical standards during the procurement and execution of contracts, ensuring that their suppliers and contractors further down the supply chain also maintain high standards of Ethical procurement, treatment of workers and use of resources.
Ethical behaviour may seem like a wide concept, but in the field of procurement some ethical concepts and principles are particularly relevant:
Ethical procurement requires making decisions based on the whole life cost, the associated risks, measures of success and implications for society and the environment. Making decisions in this way requires setting procurement into a broader strategic context including a number of factors:
Working conditions: Annex IV expressly requires the avoidance of Child Labour and the assurance of adequate working conditions. Procurement contracts awarded using EU funds should seek to support and encourage freedom of association and decent working conditions in the workplace and actively seek to avoid relationships with contractors that engage child labour, bondage or forced labour, or practice discrimination in the work-place. Working conditions should protect more vulnerable workers from exploitation or abuse of any sexual or other nature. The Contracting Authority must be sure that Candidates and Tenderers respect basic social rights and working conditions and do not procure goods or services from suppliers who use child labour or other exploitative practices.
Social Rights: the Contracting Authority should consider the effects of the contractor choice on issues such as poverty eradication, human rights, fair-trade, sustainable development and inequality in the distribution of resources.
Environmental aspects: consideration should also be given to the effects on the environment that the assets, supplies and/or services may have, including, where possible, to the effects of waste management (“green procurement”). A supplier’s environmental performance as well as the sustainability of the delivered products and solutions should, where possible be included as criteria in the selection process and be considered during supplier assessment exercises.
Humanitarian Principle of Neutrality: procurement decisions, including those linked to the transport of aid, must reflect and respect the humanitarian principle of neutrality particularly in any man-made disaster or conflict. Therefore a contractor with known links to one of the parties to a conflict and the use of military or civil defence assets, should be used as a last resort when comparable civilian alternatives cannot be found.
Ethical Transport & Cargo: When awarding a procurement contract to a private company the Contracting Authority should consider, where possible, whether that contractor is also involved in or linked to illegal activities (e.g. arms, drug or people smuggling).
Contracting Authorities shall reject any proposal put forward by tenderers or candidates, or, where applicable, terminate their contract, if it is determined that they have engaged in corrupt, fraudulent, collusive or coercive practices. To this end, contracting authorities are responsible to introduce the necessary provisions in the bidding and contractual documents.
Contracting Authorities shall inform immediately the European Commission in writing in the event of being confronted by these practices, and provide all the relevant information. They shall also inform the European Commission under the same terms about any suspected or established breach of the present rules as well as in case of any situation likely to constitute a conflict of interest. Finally, Contracting Authorities are invited to inform the European Commission in the event they become aware of other Contracting Authorities being confronted with such practices.
References and useful links