Building with Nature BwN Guideline Environments Project phases Governance BwN Knowledge base
Networks Regulatory context Knowledge context Realization framework

Log in



    This chapter provides guidance on how to build organisational and contractual arrangements which support the realization of BwN-type projects. To that end, we address the following questions:

    • How can organizational structures, procurement and contracts facilitate BwN-type projects?
    • Which specific arrangements with regard to organization, procurement and contracts are conditional for realization of such projects?

    At first sight this subject may seem rather trivial compared to issues of how to get and keep BwN on the agenda (see Networks), how to deal with and make good use of regulations and procedures (see Regulatory context) and how to arrange a productive knowledge process (see Knowledge context). Yet, the ultimate proof of the pudding is in pro-actively organizing the project environment, such that the results of these efforts can be harvested. Without the actual realization of the BwN-project all the efforts in the end are in vain. So right from the start, attention should be paid to an appropriate 'realization framework'.

    The chapter is set up as follows:

    • The section General (this page) offers a general perspective on BwN related aspect of procurement and contracts. It clarifies how project settings change if BwN principles are applied.
    • The section Guidance provides information on the organisational structures, types of procurement and contracts needed to support BwN within these project boundaries. 
    • Two Examples concern marine infrastructural projects: the Maasvlakte 2 extension of the Port of Rotterdam and the Port Phillip Bay Channel Deepening project of the Port of Melbourne Corporation.
    • The References section contains a number of sources of further reading.

    Reshuffled tasks and responsibilities in projects

    In the project implementation phase BwN becomes concrete. The definition of tasks and responsibilities in projects is of crucial importance since this defines the domain in which procurement and contracts have to be organized. So if BwN changes project settings, it is important to understand how.

    • Infrastructural projects generally consist of four phasesinitiation phaseplanning and design phaseproject construction phase, and operational and maintenance phase.
    • Each of these phases comes with its own internal logic, and each involves different actors that each play their role in mobilizing rules, resources and discourses. Driven by responsibilities, ambitions and motives, the roles and goals of these actors may be conflicting.  
    • BwN is best understood as the dedicated effort to realize ambitions by applying BwN principles and methodology.
    • Applying Building with Nature principles throughout the phases implies new relations between governments and private parties and new responsibilities and roles fo knowledge workers, decision makers, stakeholders, consultants and contractors.
    • This means that tasks and responsibilities are reshuffled: in decision making on the project objectives (‘what is to be done?’) the public actors will stay responsible and accountable. Knowledge workers, consultants and contractors, however, may play significant roles in the learning process on what is feasible in an ecosystem, how an integral approach can be achieved, how natural forces can be used, and how valuable eco-services can be harvested.
    • These efforts seemingly optimize on 'how can it be done', but they will inevitably influence the 'what is to be done' question. A precondition therefore is that participatory horizontal relationships between governments, stakeholders, knowledge workers, consultants and contractors be established, like BwN principles suggest.
    • The integrated multi-scale and multi-sector approach seeking to optimize on the potential of the ecosystem will raise complexity. Hence cross-sectoral and cross-disciplinary ways of working are a necessity.   

    Inevitably, the question needs to be answered how to deal with procurement and contracts if a project is to be realized in an environment with reshuffled tasks and responsibilities while embracing BwN. 

    Innovative organisation of procurement and contracts

    The developments described above call for a redesign of the setting in which project realization takes place, such that the seedbed of the BwN-approach can be harvested during realisation. It means that both authorities and private organisations have to be willing to rethink their roles in the process, to think differently about how they can make best use of each other's competences and resources, and to act differently in their new roles. Possibly, contractors (hired for design & construction works) will also play a more substantial role during the initiation and planning phases, or during to operation and maintenance phase (DBFM-contracts).  This must have implications for the enabling procurement and contract types.

    Governments have to follow a tender process when they outsource works and contracts. The rules, procedures and requirements for this are easily traced in national legislation. The bid process typically includes prequalification or integral qualification criteria, usually including technical and organisational qualification for similar work and financial eligibility, expressed in terms of total turnover. Such rules that frame competition and determine who is eligible influence the line-up of private parties interested in tendering, such as consultants and contractors. Often a consortium of organizations is called for, to convince authorities that the necessary added can be delivered. This also gives reason for concern, as high entrance barriers lead to constrained competition and don’t stimulate the development of a BwN-market. Also in emerging markets such criteria might hinder development of the nascent market.

    In practice, two upscaling strategies to meet the qualification criteria are observed: the formation of substantial main contractor - sub-contractor consortia, in which the ex ante assessment of the subcontractors is often weak, or a joint ventures of small ineligible sub-contractors seeks for a big main contractor. 


    This section gives guidance on the case to case application of the redefined procurement and contracting procedures.

    Organize procurement pro-actively

    It is important to understand the relevance of pro-actively organizing the procurement model.

    • Pay attention to the realization framework right from the start.
    • Let authorities, project owners and project developers discuss as soon as possible the perspective with regard to (the organization of) procurement.
    • Try to reach out for a clear and shared perspective on the procurement and the roles of public and private parties across the project phases; also note the guidance below regarding types, process, management, partnerships and feasibility.
    • Anticipate the consequences for each of the project phases.
    • Anticipate the consequences for the type of consortium required and act accordingly.

    Types of procurement

    The three main types of procurement can be ordered from conventional to innovative: 

    1) Traditional: market parties are involved only when the design has been completed and only some minor design or construction details can still be filled in.  Market parties then compete on price, quality and competence for the contract to realize this design.

    2) Second generation: Design & Construct: market parties are involved on the basis of a conceptual design of a preferred alternative. In the procurement process market parties compete on their ability and competence to develop a final design that fits the requirements. This procedure is meant to lead to optimal ability to realize the design, and to the selection of the supplier that is best able to identify, assess and control risks. 

    3) Third generation: full integration: market parties are involved before the preferred alternative has been identified. This model requires relaxing the fixed-price principle that is often used in the other models. Here the procedure often starts with a frame of reference, functional requirements or a reference design that indicates the qualities and values that are of relevance.

    Generally speaking the first model is still mainstream, the second  model is regularly applied and the third model is considered as novel. BwN can be used in all three models, but flourishes best in the third model.

    The second and third type of procurement are meant to mobilize the competences and innovation-power of the private sector. Governments do this by, instead of producing a comprehensive and detailed set of requirements, focussing upon the desired output and organizing a balanced cooperation process including the private sector. The desired output, goals and ambitions, are expressed in functional terms. The arrangement assumes that responsibilities allocated to the market enables the private sector to evelop more effective and efficient input. In most cases the actors from the private sector are contracted for a substantial period to design, build and/or to maintain (so called Design-Build-Maintain contracts - DBM contracts). Lately this more often also includes finance (so called Design, Build, Finance and Maintain contracts DBFM contracts). This should lead to added value, projects of a better quality at an identical price or identical quality at a lower prices. An additional argument is that private financing also might up speed realisation.

    The procurement process

    In the third generation model the procurement process includes three phases:

    1. Preselection: interested suppliers position themselves on price, knowledge, competences, including management of perceived risks and outcomes. An expert of the proposing consortium envisions the situation in a short document and shows his ability not only to identify and manage risks (which is a traditional procurement criterion), but also to identify and seize opportunities  These two abilities are equally important and may even include stakeholder management. After preselection the procedure continues with negotiations with one or two selected consortia. Avoiding the time trap requires starting the procedure early or avoiding strict deadlines.
    2. Detailed planning in interaction between each of the preselected consortia and the authorities responsible for procurement.
    3. Actual procurement: final selection of the consortium and contracting for project implementation.


    Effective management of the procurement process  

    Managing the process described above requires:

    • Formulation of sound functional requirements instead of technical specifications. Sound functional requirements include at least the project ambitions and goals to fulfil in space and time. In a layered approach, these criteria may vary through the design process and should anticipate the consecutive steps towards specifications for the final design and its implementation. 
    • Such incremental changes of functional requirements will have consequences for the cooperation and procurement processes, which need to be identified and thought through. 
    • Make the process as explicit as possible, i.e. clearly state who is responsible for what, agree on a set of objective performance indicators and how they are measured, allocate risks over partners and determine how pains and gains will be shared. Note that these monitoring, verification and accounting schemes need regularly updating as the project proceeds.  

    Public Private Partnerships

    • There are three main types of public-private partnerships showing similarity to the three procurement models described above: consultation, interaction without (financial) engagement, and interaction with (financial) engagement (Van Ham and Koppenjan, 2002 & Koppenjan and Enserink, 2009). The latter type can be used to integrate BwN elements in the project, as risks can be spread among the partners.
    • Public-private financing is often used to overcome the gap between design and execution, and thereby optimizing the financial project development. Moreover, it may enable relaxing the fixed-price principle.
    • Risk handling may also be an issue to be settled. In a typical design & construct case the responsibilities can easily be included in the contract. In the situation in which private or PPP consortia cover more phases, however, this may be a point of concern. There is clear overlap between issues to address when working in PPP and those of relevance to BwN.

    For further reading, see PPP in practice.

    Feasibility of innovative procurement

     Some further issues to take into consideration:

    • Whereas the traditional procurement model suits single-organization suppliers very well, the more innovative and demanding procurement procedures will often require consortia of organizations that pool competences and jointly act as a suppliers. This requires a pre-assessment in which consortia have to show sufficient competences as plan and/or project developer. The criteria for this assessment have to be clear beforehand. For PPP the procurement criteria are well-known, but for BwN criteria have to be added. Competences should include hydrology, morphology, ecology, engineering and governance. The organisations should include an interdisciplinary team (ecology, engineering and society), capable to apply the BwN principles assuming added value can be achieved, to be proven by experience in previous projects.
    • Making the added value of BwN tangible and verifiable is a prerequisite to reordering roles and responsibilities accordingly during the project phases. This concerns the  added value with regard to the project’s multi-purpose perspective, as well as the total costs over the project lifecycle. An innovative approach to make the added value of BwN tangible and verifiable is the valuation of ecosystem services approach.
    • BwN principles assume added value can be achieved by integrated developement across sectoral and disciplinary boundaries. Best Value Procurement (BVP), which aims at procurement of the best value for the lowest price, enables authorities to stimulate contractors to mobilize broader competences and develop integral projects. If added value is likely to be achieved, and the proposers show competence in assessing and controlling the risks (from the perspective of the authorities), the authorities may consider a larger role for them in the initiation and planning phases.

    Further information on these topics can be found on Project phases Planning and design


    Due to the fact that innovative procurement and contracting is still nascent the examples given below are of a descriptive nature and each example includes a link towards documents that include analysis of the case or guidance for handling of similar cases. 

    Case Melbourne Channel Deepening Project

    The port of Melbourne is a city port in Melbourne, in the state of Victoria, Australia. The Port of Melbourne is the largest cargo port in Australia, followed by Sydney. The Melbourne Channel Deepening Project has been initiated by the Department of Infrastructure of the Victorian government, to allow larger ships to enter the Port of Melbourne. Without deepening the port would have become the shallowest port in Australia, as the ports of Adelaide, Sydney and Perth have already upgraded their entrance channels. The port could thereby lose its strong position of being a main node in the network of maritime shipping.

    The project is located in Port Phillip Bay, a large but shallow bay, connected with the Bass Strait through a small entrance. Through this entrance runs a deep (80 m) canyon, the remains of the former Yarra river bed. The city of Melbourne has spread around the bay. Due to this position the project is subject to engineering, environmental and social concerns. Deepening the bay’s entrance had previously been done by destroying the rocky sides and pinnacles of the canyon using dynamite. Due to the environmental implications of this practice, this was not considered an appropriate method. A new technique that is able to remove hard rocks while dealing with strong currents had to be developed during the project development. Another open question at the start of the project was how to deal with deposition of dredge sludge, and especially the contaminated sludge from the Yarra River. The proposed project plan also had to deal with ecological concerns, such as invasive species, coastal erosion, dredging plumes, the ecosystem in the canyon, and the health of the two penguin populations. The high human population around the bay also asks for considerations as the bay is heavily used as recreation area and as means for a living. Users of the bay, such as divers, boaters, commercial- and recreational fisherman are all concerned that their livelihood will be destroyed due to the dredging program. All these concerns have to be integrated in the project planning and design.

    The Melbourne Channel Deepening project is not a pure example Building with Nature case. However, it addresses some design- and governance characteristics that can be used to understand enabling and constraining conditions for Building with Nature projects. Firstly, the Port of Melbourne Corporation entered into a 'partnership' with Boskalis. This partnership, that was based on a 'no blame' agreement, allowed for an integration of planning and construction considerations. Secondly, an ecosystem approach for the environmental risk and impact management was adopted. This also gave sustainability and environmental safe design principles priority,  leading to  a situation in which design parameters and engineering solutions became subordinate to environmental risks. A third characteristic is the switch from a ‘closed’ public community communications strategy towards an ‘open’ approach in which community representatives are briefed and open information meetings were held in different places along the bay.


    The case study Melbourne port extension addressed the applied project arrangements. 
    The observations and lessons are included as chapter 3 in the report Infrastructure Planning and Delivery: Best practices and Case Studies (Commonwealth of Australia,Department of Infrastructure and Transport, 2010). 

    The report can be downloaded

    Case Maasvlakte 2, Port of Rotterdam

    The Maasvlakte 2 (MV2) expansion project of the Port of Rotterdam, comprises of a land reclamation project. This project has been initiated by the Dutch government and the Port of Rotterdam to cope with future space shortages of the port. The terms of reference were set by a societal discussion on usefulness and necessity. A conclusion hereof, besides requirements on the size and possible lay-out of the extension, was that the extension of the port should coincide with the creation of additional nature, recreational area and livability improvements in the broader Rotterdam area (see figure 1). The further development of the project design was taken up by the then privatized port authority by the definition of ‘functional requirements’ that are based on the Terms of Reference, Dutch and EU regulations. Based on these requirements the constructors developed an engineering design. After rewarding the contract, the constructors and the port authority aligned to optimize the engineering design. Of interest in this situation is that the port authority, as private entity, was able to discuss both the engineering design with the constructors, as well as the environmental permit requirements with the  authorities.



    Although not specific tailored towards the Maasvlakte 2 the European PPP Expertise Centre issued relevant guidance with regard to preparing and handling PPP cases such as the Maasvlakte 2 extension case:

    The report can be downloaded



    Bradford,S.,Siebinga, M., 2009; Communicating about dredging in a precious environment: Port of Melbourne Channel Deepening Project - IADC Terra et Aqua, september 2009

    Bundgaard, K., Klazinga, D., Visser, M., 2011;Traditional procurement methods are broken: can early contractor involvement be the cure? – IADC Terra et Aqua, September 2011

    Commonwealth of Australia, Department of Infrastructure and Transport. 2010. Infrastructure Planning and Delivery: Best practices and Case Studies.


    European PPP Expertise Centre

    Some further reading on PPP in practice:


    Back to Top