The “baby steps” in mainstreaming sustainable public procurement in Ghana: A “double‐agency” perspective

• Published date: 01 February 2019
• DOI: http://doi.org/10.1002/pa.1902
• Author: Theophilus Maloreh‐Nyamekye,Peter Adjei‐Bamfo
• Date: 01 February 2019

ACADEMIC PAPER

The “baby steps”in mainstreaming sustainable public

procurement in Ghana: A “double‐agency”perspective

Peter Adjei‐Bamfo |Theophilus Maloreh‐Nyamekye

Department of Public Administration & Health

Services Management, University of Ghana

Business School, Accra, Ghana

Correspondence

Peter Adjei‐Bamfo, Department of Public

Administration & Health Services

Management, University of Ghana Business

School, P. O. Box LG 78, Legon, Accra, Ghana.

Email: bamfopeter@gmail.com

The emerging literature on public procurement policy suggests that public procure-

ment may be leveraged to advance several public policy agenda. Hence, many

countries have reformed their public procurement process towards social and envi-

ronmental outcomes termed sustainable public procurement. These reforms have

often been launched in response to international initiatives such as the global

10‐year framework for action on sustainable consumption and production by the

Johannesburg implementation plan in 2002 and the Sustainable Development Goals.

Yet, empirical evidence on the drivers and benefits of SPP in developing countries is

still scarce. This gap is addressed with a qualitative case study of six public sector

institutions in Ghana. On the basis of elite interviews, this paper highlights barriers

to mainstreaming SPP in Ghana's public sector. We further advance the scanty

principal–agency literature by establishing a double‐agency relationship in the context

of SPP, which depicts limited agency cases where principals lack the capacity to

defend their own interests.

1|INTRODUCTION

The public procurement literature suggests that substantial amount of

public funds are spent on public procurement (Thai, 2001). Globally,

this constitutes about 15–20% of national revenues, with the figures

from developing countries hovering between 20 and 70% (Thai,

2001; World Bank, 2012). Notwithstanding, most governments often

fail to apply due diligence in their procurement processes, which often

results in negative environmental and socio‐economic impacts,

corruption, and legal losses on government coffers (Hope, 2017;

Neupane, Soar, & Vaidya, 2014; Preuss, 2007). Taken together, these

consequences can culminate into a severe loss of value for citizens

and impede a nation's overall development. Hence, many countries,

including Ghana, have reformed their public procurement processes

towards social and environmental outcomes.

Contemporary public procurement serves as a tool for advancing

good governance and sustainable development through resource opti-

misation, improved project delivery, strengthened public procurement

systems, and stakeholder participation (Adjei, 2010; Preuss, 2009).

International reports argue that reformation of public procurement

“can contribute directly to improving a country's business, investment,

and social environments”(World Bank, 2012, p. 6). In response to

public procurement shortcomings and the global 10‐year framework

for action on sustainable consumption and production by the

Johannesburg implementation plan, the Marrakech Task Force (MTF)

was voluntarily formed in 2003. Led by the Swiss Government, its

members include Mexico, the Philippines, Argentina, Ghana, Czech

Republic, Norway, China, the United Kingdom, the State of Sao Paulo,

and the United States of America, as well as several international

organisations. With a framework developed from its periodic meet-

ings, the MTF seeks to stimulate sustainable public procurement

(SPP) practices among both developed and developing countries.

These efforts are further deepened by target 12.7 of the Sustainable

Development Goals (SDGs), which focuses on stimulating SPP

practices in accordance with national priorities.

What are the barriers of implementing SPP in developing

countries? Prior research has found positive effects of integrating

environmental and socio‐economic criteria into procurement practices

(Hall & Purchase, 2006; Preuss, 2007; Walker & Brammer, 2009,

2012). However, these studies focussed on developed countries

(Keulemans & Van de Walle, 2017)—leaving a gap with respect to

the developing country contexts. Empirical studies and knowledge

Received: 12 November 2018 Accepted: 16 November 2018

DOI: 10.1002/pa.1902

J Public Affairs. 2019;19:e1902.

https://doi.org/10.1002/pa.1902

© 2019 John Wiley & Sons, Ltd.wileyonlinelibrary.com/journal/pa 1of16

on the prospects, drivers for adoption, and potential impact of SPP on

the participation of small local businesses in developing countries are

essential because these resource‐constrained economies have high

levels of inequalities and climate change vulnerability (Karjalainen &

Kemppainen, 2008; Walker, Miemczyk, Johnsen, & Spencer, 2012).

The study adopts a qualitative approach with case studies from six

Ghanaian public sector organisations to illustrate the barriers

hampering efforts to mainstream SPP in Ghana. The paper draws on

the principal–agency theory in its analyses of in‐depth interviews

gathered.

The remainder of the paper is structured as follows. A conceptual

background to the study and the justification for the use of the

principle‐agency theory as theoretical framework is presented in

Section 2. Section 3 outlines the research methodology. The main

findings of this study are subsequently discussed in section 4.

Section 5 concludes the paper with implications for public procure-

ment policy and practice, the agency theory, and for future research

agenda.

2|CONCEPTUAL OVERVIEW

2.1 |Public procurement as a strategic public policy

tool

Public procurement refers to the process through which public sector

agencies acquire public goods and services from third parties

(Neupane et al., 2014). It encompasses buying, renting, leasing, or

acquiring supplies, construction, and various forms of services.

It comprises inter alia a narration of requirement, selection, and award

of contracts that relate to obtaining goods and services by the govern-

ment for the welfare of citizens. Emerging literature suggest that

public procurement may be leveraged to advance several public policy

agenda (Grandia & Meehan, 2017). For example, Grandia and Meehan

(2017), from a multidisciplinary perspective, delineate the implications

of public procurement for achieving public value and illuminate its

strategic aspirations and attractiveness to policymakers, as it consti-

tutes a substantial fraction of government's expenditure (see also

Erridge, 2007). Unlike the private sector, buyers in the public sector

operate in a political market place with different incentives,

constraints, and with different opportunities for discretionary actions.

Therefore, they afford the opportunity to apply their procurement

choices towards a wider scope of public policy agenda (Grandia &

Meehan, 2017; Parker & Hartley, 1997). The World Bank (2012), for

example, notes that public procurement is interconnected with the

three main pillars of effective governance: enhanced delivery of public

service, value for money, and a supportive environment for private

sector growth. Parker and Hartley (1997), however, caution that

stretching the selection criteria to meet these several policy outcomes

has negative implications as it leads to vaguely specified contracts

with little contributions to achieving expected outcomes (see also

Patil, 2017).

Also, the public procurement practice is sometimes fraught with

inefficiencies such as undue delays, corruption, lack of transparency,

and disregard for social and environment impacts (Karjalainen, 2011;

Mawenya, 2008; Neupane et al., 2014; World Bank, 2003, 2012).

For example, the World Bank (2012) and Transparency International

(2011) argue that public procurement corruption is increasing globally

and particularly in developing countries. Public procurement corrup-

tion in sub‐Saharan Africa particularly constitutes over 70% of public

contracts with a 30% price rise (Mawenya, 2008). This menace

hinders national development by weakening national institutions,

increasing business costs, eroding public trust, as well as discouraging

external investment (Hope, 2017; Neupane et al., 2014). From the

agency perspective, Kauppi and Van Raaij (2014) observe that the

inherent information asymmetries in the public procurement process

engenders opportunism due to the incongruent goals of actors.

Further, excessive delays in the payment process to contractors is

reported to be severe, which in Ghana's case, exceed 30 steps (World

Bank, 2003, 2017).

To address these problems, contemporary public procurement

policies have been reformed through decentralisation, digitisation,

increased emphasis on environmental and social outcomes, increased

spending visibility, and minimised information gaps in the process

(Klabi, Mellouli, & Rekik, 2016; Neupane et al., 2014; Preuss, 2009).

Other initiatives target value for money (i.e., economy, efficiency,

and effectiveness), achieved through prudent use of public resources

in the acquisition of goods, works, or services (Ibrahim, Bawole,

Obuobisa‐Darko, Abubakar, & Kumasey, 2017). According to Ibrahim

et al. (2017), value for money emanates from true compliance with

best procurement practices and rules that guide the specification of

pretender criteria, bidding, evaluation, and award and execution

criteria but not covert attempts to “window‐dress”noncompliance

(p. 381). Value for money also concerns an assessment of life‐cycle

cost and quality of products or the evaluation of whether the

expected outcome of the procurement is satisfied. Klabi et al. (2016)

submit that these measures inform the government about the reputa-

tion of the supplier towards lowering the risk and cost of future

procurements.

2.2 |Sustainable public procurement

Emerging public procurement literature contends that there is the

need to assess tenders beyond price criteria—to also consider other

environmental and social criteria that control the production and con-

sumption behaviours of suppliers (Gelderman, Semeijn, & Bouma,

2015; Keulemans & Van de Walle, 2017). This concept, which is

termed sustainable public procurement, is defined by Brammer and

Walker (2011, p. 455) as “… the act of integrating a concern for

broader social and environmental impacts within procurement under-

taken by government or public sector bodies.”The definition

suggests an act of expending public resources on products and

services that promote sustainable development tenets. In line with

this idea and for the purpose of this study, the concept is defined

as the considerations for long‐term social and environmental impacts

of products while meeting the fundamental principles of public

procurement.

SPP has become popular in light of the major adjustments in the

global corporate social responsibility (CSR) and supply chain debates

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