As sustainability becomes a core part of business strategy, organisations are turning to recognised frameworks to embed responsible practices into their operations. Two such examples – ISO 20400:2017 and the CO₂ Performance Ladder (the Ladder) – offer distinct but complementary approaches for organisations seeking to make procurement more sustainable and carbon-conscious. While one provides strategic guidance for sustainable procurement, the other is a practical tool to harness the power of procurement to drive carbon reduction, making them highly complementary.
Although different in structure and emphasis, ISO 20400:2017 and the Ladder can work together to support stronger decision-making, better supply chain engagement, and measurable sustainability outcomes.
ISO 20400:2017 is the international guidance standard on sustainable procurement. It supports organisations in incorporating environmental, social, and economic considerations into procurement decisions—encouraging long-term thinking, stakeholder engagement, and lifecycle analysis. While not certifiable, ISO 20400 acts as a strategic framework that procurement teams can use to align purchasing practices with wider sustainability objectives.
The Ladder is both a low-carbon procurement instrument and an energy and CO2 management system. Developed in the Netherlands, it is now widely used across Europe.
As a procurement instrument, procuring organisations can integrate the Ladder into tenders to incentivise their suppliers to structurally reduce their carbon emissions. The carrot is an award advantage, with the level of fictitious discount or points varying based on the ambition level. This helps procurers to translate their carbon reduction and green procurement goals into clear procurement incentives that drive real supplier performance improvements across the board.
That’s because, in order to receive that award advantage, organisations commit to implementing a carbon management system with the goal of structurally reducing their emissions and energy consumption. Built on the principles of continuous improvement through the Plan-Do-Check-Act (PDCA) cycle, it extends beyond setting reduction targets to include broader themes such as stakeholder engagement, energy efficiency, and life-cycle assessments.
Organisations can certify at one of five levels (version 3.1), or three steps (version 4.0), each reflecting deeper commitment to emissions reduction. At lower levels, organisations focus on optimising their own business operations in order to reduce their energy consumption and cut their direct and indirect CO2 emissions. At higher levels, organisations are challenged to look beyond their own operations (scopes 1 and 2) to the supply chain and beyond (scope 3 and Other Influenceable Emissions).
Certification is conducted by accredited third-party auditors. Ongoing compliance requires annual audits, with full recertification every three years. Costs vary depending on certification level and the maturity of the organisation’s existing carbon reduction efforts.
Both ISO 20400 and the Ladder:
In short, both ISO 20400 and the Ladder, as both procurement instrument and management system, promote alignment between organisational goals and supply chain practices, and drive organisations to go beyond compliance and deliver long-term value for the climate.
While ISO 20400 and the CO₂ Performance Ladder share the goal of embedding sustainability into procurement, they operate at different levels—and together, they create a powerful link between strategic ambition and operational delivery:
Organisations already aligned with ISO 20400 can take two main pathways with the Ladder. Perhaps the most obvious is to use the Ladder as a procurement instrument – integrating into tenders as an incentivisation mechanism, and thereby tackling their procurement-related emissions and taking concrete action to achieve ISO 20400 commitments.
Organisations using ISO 20400 can also pursue full Ladder certification to add structure, transparency, and accountability to their carbon reduction efforts. Their engagement with supply chain issues could enable them to aim directly for the higher levels of the Ladder, where scope 3 emissions are included.
Conversely, organisations certified under the Ladder can gain inspiration from ISO 20400 on how to tackle their procurement-related emissions, and broaden their sustainability focus with ISO 20400’s environmental, social, and economic guidance. Organisations using the Ladder in procurement can use ISO 20400 to broaden their sustainable procurement toolkit and approach, for instance by developing an overarching green procurement strategy.
ISO 20400 supports long-term thinking through principles like lifecycle costing, supplier development, and sustainability risk management. The Ladder translates these principles into practice by embedding them into a management system norm and procurement method, which procurers can then use to drive performance in tenders.
As an example, a local authority may use ISO 20400 to develop a sustainable procurement policy that prioritises low-emission suppliers. The local authority can then use the CO₂ Performance Ladder in its tenders—offering a scoring advantage to bidders based on their ambition levels. This creates a clear incentive for suppliers to improve their climate performance, thereby achieving the broader organisational goal to prioritise low-emission suppliers. Going further, the local authority could (also) get certified on the Ladder itself, thereby gaining insight into the relative climate impact of its procurement, and enabling it to reach overall climate targets.
Sustainable procurement is no longer a “nice-to-have”—it’s a strategic necessity. ISO 20400 and the CO₂ Performance Ladder each play a distinct role: one sets the direction, the other delivers measurable impact.
Together, they offer a complete procurement roadmap—from high-level policy to operational outcomes. For organisations aiming to lead on sustainability and supply chain decarbonisation, combining these frameworks can unlock meaningful, lasting results.
| Criteria | ISO 20400:2017 | CO2 Performance Ladder |
| Scope | Sustainable procurement covering social, environmental, and economic aspects. | A management system for energy and carbon reduction |
| Structure | Voluntary guidance, flexible implementation | Multi-level certification |
| Procurement | Shapes sustainable procurement decisions | Multi-level incentivisation (through fictitious discounts or points) |
| Validation | No certification; self-assessment or third-party assessment is possible | Third-party validation conducted by accredited certification bodies |
| Cost Summary | Costs associated with purchasing the standard and, third-party assessments (optional) | Costs include a contribution to the scheme manager (based on organisation size), internal resources for implementation, and third-party auditing fees. Auditing fees vary based on level, organisation size and auditor |
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