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Technical Information Article

​Improved Performance for Businesses Implementing ISO 14001: 2004

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Since the emergence of the first certified environmental management systems (EMS) in the early to mid nineties, there has been an increasing level of interest in their use within the furniture manufacturing sector. Improved environmental management means lower risk, higher potential for cost savings, which go straight to increasing profit while reducing emissions and subsequent pollution.

The implementation of an EMS enables a process of continual improvement, not only at the production facility but also through influencing suppliers and designing the product for eventual disposal at the end of life. Such factors mean that the environment is no longer perceived as 'just a nicety' but is recognised as a real business issue with real benefits. Consequently, there is a growing willingness to dedicate the appropriate resources towards ensuring that environmental issues are managed in a systematic and effective manner to the benefit of both the company and the local and global environment.

Environmental Management System

Reasons for Implementation

For a number of years, companies have undertaken environmental audits or reviews to assess their environmental performance. Whilst such exercises are useful in their own right, they may not be sufficient to provide an organisation with the assurance that its performance not only meets it’s legal and policy requirements, but also improves year on year. The implementation of an EMS such as ISO 14001 provides the basis for this assurance by offering an effective management system, which may be integrated with other systems such as quality or health and safety.

There are numerous reasons why companies implement ISO 14001 but the biggest driving force in the UK appears to be customer pressure. Increasingly detailed questions regarding environmental performance have become mainstream in tender documents, especially from government bodies and large influential companies ensuring their suppliers follow in their footsteps. Therefore as the number of certified companies grow, increasing pressure will be exerted upon the supply chain.

In many cases it is not until companies start to implement the standard that they realise that there are many more benefits to environmental management than customer satisfaction. Some of these include:

  • Achievement of environmental and economic goals
  • Assessment, control and improvement of environmental performance
  • Cost savings
  • Improved working environment

Improved Performance Through Implementation of an EMS

Two main aims underpin EMS standards: continual improvement and commitment to meet the requirements of all relevant environmental legislation and the company’s environmental policy statement. The concept of continual improvement recognises that no industrial organisation will have a problem free site. Either poor practises, legislative non-compliance, or areas of unacceptable risk are generally inevitable within many companies, especially those that have not previously addressed environmental issues in a systematic manner. Industrial sectors vary widely and therefore the standard does not set down absolute performance levels that must be reached, but rather require an on-going improvement on that which existed previously.

In order for an EMS to demonstrate some degree of competence to external parties, elements of absolute achievement are introduced in the commitment to meet the requirements of all relevant environmental legislation. Environmental legislation, which continues to grow exponentially within the UK and the rest of Europe, sets down minimum standards of performance and the presence of a certified EMS demonstrates that your company has at least met these requirements and in most instances exceeded them.

Legal compliance can give directors peace of mind in the knowledge that they have significantly lowered current and future liabilities and lessened the risk of prosecution, fines, clean up costs and poor publicity. Reduced insurance premiums are also a possibility. The identification of future legislation, another expected element of the standard, will mean that future compliance for instance, can be carried out in the most logical and cost effective manner within well planned budgets.

During the initial steps of implementing ISO 14001 companies are asked to identify their environmental aspects as a consequence of their activities, products or services and establish their associated impacts on the environment. Some form of prioritisation of significance allows companies to address/improve on the important issues first. This is seen as a common sense approach as it would be impractical to manage or improve all aspects at once. For some companies this may be the first time that they have listed these aspects and for certain areas calculated the financial burden to the company. Measuring either the cost of waste to a company or the cost of energy over a twelve-month period can be quite a shock, especially if that figure is taken as a percentage of the company turnover. The subsequent setting of objectives and targets to reduce the impact of these aspects will undoubtedly improve environmental performance and save money, in turn increasing profit.

It is not unusual, for example, for waste generation and disposal to account for at least 4.5% of turnover for UK furniture companies. Cutting down on the amount of waste generated is a common target and can have a two-fold benefit by reducing raw material usage and disposal costs. Both will help to give increased profit, with a saving of 1% of turnover invariably easy to achieve, offering considerable savings. The objectives and targets set by companies should be both realistic and achievable. Where possible targets should also be quantifiable, so that improvements can be easily reported and recorded, with cost savings readily identifiable.

Reporting Environmental Performance Sustainability

Reporting on environmental performance within the UK is still a relatively new concept. All companies with a certified EMS will report internally, both at ‘management review’ and at staff briefings. Management review is a requirement of the standard and not only ensures that continual improvement remains the commitment of top management but also that the suitability and effectiveness of the EMS, and therefore the environmental performance, continues.

Reporting to staff is also an important concept. This may be undertaken through staff briefings, newsletters or notices and ensures that the successes of the company are shared so that the motivation of employees remains high. The achievement of objectives and targets, which is usually dependent upon full co-operation of the workforce, needs to be acknowledged and the savings highlighted. Without this motivation, tackling new projects for improvement, will become increasingly difficult. Some companies run incentive or profit sharing schemes for employees, which increases their awareness of cost saving ideas. Other companies allow for a percentage of any savings made through environmental improvement to be re-invested in the EMS.

Companies which have their system accredited by a third party independent certification body, can use the certificate as a marketing tool to generate new business. However, certification is by no means a pre-requisite for benefiting from implementing an EMS. From purely evaluating significant environmental aspects and implementing targets for improvement, benefits will be accrued.

Conclusions

There are many potential benefits for a company implementing ISO 14001. Not only do efficient production and cost savings help improve company performance, but most organisations with an accredited system have not only managed to retain current customers, but they have also attracted new ones.

Governments appear to be actively encouraging businesses to adopt systematic approaches to environmental management, which will enhance the organisation’s credibility. As a consequence they will be able to benefit from the increased visibility that participation in such schemes provides, not least in international markets. Tackling such items as energy efficiency and waste minimisation alone can ensure that your company is economically viable and in a better position to incorporate sustainable practises and sound environmental management, which may soon be seen as a must rather than a maybe.

With the help of FIRA and our own environmental club 'Club Green', a practical approach to environmental management and cost savings is within the reach of all furniture companies. Consultancy advice at the start of your implementation project may save you hours of work in documenting a system.

For an informal discussion about the cost of our consultancy services and Club Green membership contact Technical Services.

Contact: Technical Services
email: info@fira.co.uk

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