JARGONFREE Compass for Sustainable Contracting

Misplaced content

In addition to being hidden, fragmented, or misaligned, sustainability-related content may also be misplaced. To have an effect, it needs to reach the places where decisions are made and actions are taken.

Content that does not reach the right point of action, such as:

rarely influences what happens in practice.

Three typical failure patterns in translating sustainability into practice

ContextTypical failureConsequencesDiagnostic question
1. ProductsSustainability is not translated into concrete product or technical specifications; reliance on generic clauses such as “comply with all laws”.Environmental and social impacts are not addressed at the design and specification stage, where many key design and sourcing decisions are made and actions are taken.Are sustainability goals translated into concrete, product-level requirements and specifications?
2.Operations & processesCommitments remain at general level and are not embedded in operational practices, processes, or responsibilities.Identified sustainability impacts and related targets and requirements are not embedded in daily operations.Does the contract require concrete actions, processes, or practices that make sustainability executable?
3.Supply chain & cascadingRequirements are not designed to be passed on to suppliers; cascading mechanisms are missing or unclear.Sustainability requirements remain limited to the immediate contract relationship and are not implemented beyond the first tier.Does the contract require the supplier to pass on relevant requirements to its own suppliers and ensure their implementation?

Sustainability requirements fail not only because they are unclear, but because they fail to reach the operational points where decisions are made, responsibilities allocated, and actions carried out: product specifications, operations, and supply chains.

1. In products: Sustainability does not reach specifications

If sustainability is not translated into concrete design criteria, it may not be built into products. Contractual specifications may, for example, leave unclear what data is required, which materials are permitted or prohibited, and how sustainability expectations should shape design decisions.

“Comply with all laws” in a contract does not guide engineers or product managers. It may feel legally sound but does not provide the operational clarity required for action.

2. In operations and processes: Sustainability does not reach operational practices

Without clearly defined operational responsibilities and processes, sustainability may not translate into practice.

For example, a (Supplier) Code of Conduct alone may not ensure implementation if it is not embedded in the contract and translated into clear responsibilities and processes based on identified sustainability impacts and related targets and requirements.

3. In supply chains: Sustainability does not reach beyond the first tier

Supply chains are built on contracts. Individual contracts define roles and responsibilities at product and operational levels, but their impact depends on whether requirements are designed to travel beyond the immediate contractual relationship.

Without clear cascading mechanisms, suppliers may not know what is expected of them or how requirements should be passed on. As a result, sustainability requirements often remain limited to the first contractual tier and fail to influence the broader supply chain.

Diagnostic exercise: Does it reach where actions take place?

Take a sustainability-related clause or requirement from your contract stack.

Step 1: Where is it located?

Where is this requirement currently located?

  • Main contract
  • General Terms and Conditions
  • (Supplier) Code of Conduct
  • Supplier Requirements
  • Specifications
  • Other: ______

Is this where decisions based on this requirement are actually made?

☐ Yes ☐ No

Step 2: Where should it be placed?

At which points of decision-making should this requirement influence decisions?

Point of decisionShould it influence decisions here?Is it placed here?
Product (specifications, design)
Operations & processes
Supply chain

If a requirement should influence decisions in a given context but is not placed there, it is likely misplaced. A requirement that is not placed where decisions are made is unlikely to influence practice.

Even when content can be found and connected to the right points of action, it may still fail to support and guide action if it is difficult to understand or use.

The next problem focuses on how content is communicated – and whether it can be understood and used in day-to-day operations.

Problem 3. Complex or unclear communication next page