From toilets to torches: Freshfields’ Olympic procurement team has it covered
16 May 2011 | By Husnara Begum
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As London gears up to host the greatest show on earth, a team of lawyers is hard at work behind the scenes drafting vital contracts that will ensure every need of both the athletes and spectators at the Olympics is catered for.
Part of that team, which is responsible for sourcing and supplying all goods and services imaginable for the London 2012 Olympics, is Freshfields Bruckhuas Deringer corporate associate Kate Cooper.
She recently returned from a secondment with the London Organising Committee of the Olympic Games and Paralympic Games (Locog) procurement department, which was charged with procuring items such as 100,000 condoms (40,000 more than at Beijing) and 10,000 portable toilets for the events.
As the biggest procurement exercise in the world, it was hardly surprising that during Cooper’s secondment Locog had already procured around £400m worth of goods and services, with another £450m in the pipeline.
“We needed to procure all sorts of goods and services to put on the games, including the victory medals for the athletes and torches to carry the Olympic flame around the country,” explains Cooper.
Indeed, according to Cooper it was the 10,000 torches that raised some of the most complex legal issues.
“We wanted a best-of-British story so that meant working with a separate London-based designer and a British engineer and manufacturer to create a vertical supply chain over which Locog would have ultimate control,” she says.
This was necessary because Locog needed to be in a position to oversee the whole project to balance the needs of the various stakeholders such as Coca-Cola, the sponsors of the torch relay, and the International Olympic Committee (IOC). The lawyers had to put in place a supply chain going from the sketches of the iconic design, through to testing by engineers for wind and rain resistance, to the ultimate production and delivery of the 10,000 torches to be taken around the country.
“It wasn’t simply a case of asking one party to produce an off-the-shelf product,” recalls Cooper. “It involved a complex set of legal arrangements, which identified and allocated the risks involved in this bespoke project among each of the key players.”
Another major challenge faced by the procurement team involved coming up with appropriate remedies in the contractual arrangements with suppliers because those typically contained in day-to-day supply agreements, such as service credits and refunds, are generally unsuitable for one-off events.
“We need absolute certainty of supply, and we need to think through and avert any risks associated with that supply well ahead of time,” Cooper explains. “You can’t just say to an athlete that their medal’s stuck in the post or that the torch relay has to start late because the production deadlines for the torch have been missed.”
Meanwhile, procuring the 4,700 victory medals gave Cooper an insight into the world of precious metals, which are being supplied by mining giant Rio Tinto, the official metal sponsor of the games. Six grams of gold are needed for each gold medal, with each one weighing around 400g. Each silver and bronze medal weighs around 350g.
“The torch and medals are hugely symbolic to many stakeholders, including the organising committee, IOC, IPC [International Paralympic Committee], the Government, sponsors and athletes, so we had to make sure in negotiating the deal to produce the medals that expectations on all sides were managed and reflected in the finished product,” says Cooper.
With the games expected to pull in nine million spectators and with some 15,000 athletes taking part, the procurement team has also had its work cut out sourcing 14 million meals, including 25,000 bread loaves, 100 tonnes of meat and 300 tonnes of fruit and vegetables. It is, therefore, no wonder that every single portable toilet in the country will be making its way to London next year, forcing the cancellation of events such as the 2012 Glastonbury Festival.
Indeed, Locog, in a bid to boost London 2012’s green credentials, is taking its responsibility towards waste management very seriously. For every person attending the games, it is estimated that 61g of waste will be produced per hour, and it is Locog’s aim that none of this will end up in landfill but will instead be recycled.
With just 437 days left until the starting guns are fired, Cooper and the rest of her Freshfields colleagues, who have been providing legal advice to Locog since 2003, do not have long to go before they finally see the results of all those years of hard work.
“It was a fascinating experience and I feel really privileged to have been part of the team and, of course, can’t wait to see all the planning and preparation come together for what I’m sure will be a spectacular event,” concludes Cooper.