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Supply chain sustainability: 5 ways to exert your influence

There are strong business benefits to be gained by understanding and managing the sustainability issues that are significant in an organisation or industry’s supply chain. Traditional procurement practices focus on price, product quality and on-time delivery – criteria that impact directly on the bottom line. However, through its various supply chain practices, an organisation can positively or negatively affect the local economy, the environment and people – via its labour practices, level of product responsibility and policies regarding human rights and society in general.

Some of the advantages of embedding sustainability considerations into procurement processes include:

  • Reducing risks (reputation, legal, environment, safety, continuity of supply, traceability and quality)
  • Achieving operational efficiencies and cost savings
  • Building mutually beneficial supply chain relationships
  • Demonstrating corporate social responsibility
  • Achieving and retaining certification to  ISO14001:2015; ISO9001:2015 and ISO45001

The standard for Environmental Management Systems, ISO14001:2015, requires organisations to “determine environmental requirement(s) for the procurement of products and services and communicate these to external providers, including contractors”.

While the potential advantages are many, the integration of sustainability principles into procurement processes may prove to be complex and challenging in practice, particularly when there is resistance to change.

Summarised below are the 5 main ways that you and your organisation can exert a powerful influence on the supply chain in order to add value to the business and better meet stakeholder expectations.

1  Securing commitment from all levels of the organisation

  • Preparing a business case
  • Conducting senior management workshops
  • Articulating a vision and long term goals
  • Defining roles and responsibilities
  • Building internal support for the program

2  Getting agreement about the sustainability impacts that are relevant and important

  • Creating a process for determining the “materiality” or significance of each aspect
  • Identifying key suppliers and other external internal interested parties
  • Conducting stakeholder engagement
  • Mapping issues important to stakeholders against business considerations

3  Identifying any significant issues that lie further up or down-stream

  • Considering the full life-cycle of a product system
  • Identifying and adjusting the organisation’s procurement practices
  • Phasing out unsustainable products
  • Working with suppliers to resolve issues

4  Effectively communicating expectations and requirements

  • Creating a Code of Conduct
  • Communicating the company’s expectations to suppliers
  • Supplier’s self-assessment
  • Monitoring the supplier’s performance
  • Conducting supplier and contractor evaluations

5  Supporting people in procurement roles

  • Developing policies to guide people in making better decisions.
  • Creating assessment checklists for new or changed processes, materials and products
  • Screening of suppliers and factories
  • Searching for the most sustainable products

The Enviroease team has substantial practical experience in buying/procurement, facilitation, impact assessment, Life Cycle Assessment and management systems. Whether the need is for senior management workshops, stakeholder engagement, supplier audits or the development of improved policies and practices, we’d be happy to assist you.

Feel free to call me, Suzy, on 0418862899 to discuss your particular needs.

Further reading:

The world’s most widely endorsed principles on corporate and social responsibility,  the UN Global Compact puts forth ten principles for business in three areas – labour standards, environment and anti-corruption – in support of the Agenda 21 goals for Ecologically Sustainable Development.

The Global Reporting Initiative‘s (GRI) “G4 Sustainability Reporting Guidelines”  includes “procurement practices” as a specific standard disclosure – G4-EC9. GRI is the most used framework for sustainability reporting with over 25,000 GRI reports in the database from 90 countries and many more organisations using the indicators to help them set goals, measure performance and manage change in order to make their operations more sustainable.

 

 

 

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How to achieve ZERO net carbon emissions from vehicles

It might surprise you that the cost to offset your vehicle emissions is only 2.5-3% of the annual fuel bill, much less than the average fluctuation in fuel prices experienced in the past 12 months.

Its easy to offset the greenhouse gases from the combustion of fuel in your company operated cars, trucks, mobile plant and other vehicles. Here are 3 simple steps to follow to obtain accurate emission estimates and achieve genuine carbon neutrality for your vehicle fleet.  The same steps can be applied to your private vehicles too. Note: to calculate emissions from vehicles your company doesn’t operate such as trains, planes, taxis and rental cars, there are different approaches which will be covered in a future blog.

 Step 1: Gather activity data

Gather all the fuel receipts for the previous financial year and total up the number of litres of each type of fuel used by each vehicle.  It is important to retrieve the data for ALL vehicles for the WHOLE year so the information is complete.   Do not use kilometres travelled and average fuel efficiency for this purpose.  Get the actual consumption of fuel to achieve the most accurate estimate. Do keep records for reporting and verification purposes.

Example: Small fleet of trucks

During the 2014-15 financial year a company purchased 100,000 litres of E10 petrol and 500,000 litres of diesel for the vehicle fleet.  The information was readily available from the fuel cards issued to staff with company cars and trucks.

Step Two: Calculate emissions

Next simply convert the number of litres into kilolitres by dividing by 1,000, then multiplying this figure by the emission factor in the table below to get the number of tonnes of CO2-e.  The little “e” means that the total will include the other greenhouse gases – methane and nitrous oxide as well as carbon dioxide. If any of the vehicles have used biodiesel such as B5, B20 or B100 or a petrol/ethanol blend such as E10, just calculate the proportion separately then add up the total. Too easy!

Example: Small Fleet of trucks

The table shows that the total emissions from the car fleet in the above example were estimated to be 1,565 tonnes.

Type of fuel used

Kilolitres of fuel

 Proportion

Emission Factor GHGs *

Tonnes of CO2-e
Petrol*

100

 90%

2.38

  214.2
Diesel

500

100%

2.70

1,350.0
LPG

1.59
LNG (light duty vehicle)

1.44
LNG (heavy duty vehicle)

1.36
Biodiesel

0.12
Ethanol

100

10%

0.08

      0.8

Total

1,565.0

* Source of emission factors:  Table 4: Fuel combustion emission factors – fuels used for transport energy purposes. The National Greenhouse Accounts (NGA) Factors, December 2014  prepared by the Australian Government Department of the Environment for use by companies and individuals to estimate greenhouse gas emissions. 

Step Three: Purchase offsets

Go on-line to find a reputable carbon offset retailer, then purchase offsets for the number of tonnes you calculated in step 2.  To avoid the risk that the offset does not represent genuine emission reduction (or removal from the atmosphere), make sure that you only EVER purchase verified carbon offsets. Reliable verifiers include, but are not limited to, VCS, NCOS, Gold Standard, Gold Power and Greenfleet. Some sellers will allow you to choose the actual project that your money will help fund such as Tasmanian native forest protection, Australian wind energy or sustainable development projects in third world countries.  Currently carbon credits will cost between $13 and $33 per tonne. For more information and advice go to the independent source:  http://otter.org.au/carbon-offsets-how-to-choose/ 

Example: Small Fleet of trucks

The annual fuel bill in our example was $840,000 ($1.40/litre average fuel price x 600,000 litres) and at $15/tonne, the carbon credits will cost 2.8% of the total fuel bill .

How we can help

Enviroease can develop a carbon reduction program for your company and find projects that may be eligible for state or federal government assistance. We are familiar with the Emissions Reduction Fund, Renewable Energy Target and NSW Energy Savings Scheme and VictorianEnergy Saver Incentive. Feel free to send an email to me (Suzy) at suzanne@enviroease.com.au to find out more.

 

 

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How do you take a life cycle perspective?

This article was updated to remove the word “draft” as the final version was published in September 2015.

While presenting a series of one day courses on behalf of SAI Global entitled “Preparing for the transition to ISO14001:2015″

I became aware that one of the concepts in the Standard is new to many people. Its the taking of a “life cycle perspective”.  So, what does this mean?

A life cycle is defined in the Standard as the consecutive and interlinked stages of a product system, from raw material acquisition or generation from natural resources to end-of-life treatment.

Life cycle assessment has been around since the 1990’s and is often called the “cradle-to-grave” approach for assessing industrial systems. This begins with the gathering of raw materials from the earth to create the product and ends at the point when all materials are returned to the earth.
LCA enables the estimation of the cumulative environmental impacts resulting from all stages in the product life cycle, often including impacts not considered in more traditional analyses (e.g., raw material extraction, material transportation, ultimate product disposal, etc.). By including the impacts throughout the product life cycle, LCA provides a comprehensive view of the environmental aspects of the product or process and a more accurate picture of the true environmental trade-offs in product and process selection.

It should be noted that a full LCA on each product will not be a requirement of the new standard. The introduction of the term “life cycle perspective” will simply translate into a stronger expectation for companies to consider how their decisions impact further upstream or downstream of the company’s operations. They will need to demonstrate how they used their influence on suppliers, contractors, customers and consumers to improve sustainability across the supply chain.

How can Enviroease help?

If you are thinking of developing an Environmental Management System or need ideas on how to integrate life cycle thinking into your existing EMS, I can offer help you directly.

I can also arrange for an LCA to be conducted on one or more of your products by an associate, Dr Suphunnika Ibbotson, is an experienced LCA practitioner. Suphunnika has completed a number of peer reviewed LCA projects using Simapro while part of UNSW faculty of Sustainable Manufacturing Engineering and Life Cycle Engineering Research Group.

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What makes effective training?

This article was reviewed in July 2018 to update the last section on experience

Deciding how much and what type of environmental training to conduct in your workplace can be a daunting task. Here are 5 tips to guide you through the maze.

1. Focus on high risk
Refer to the site’s Aspect Register or Risk Register to establish the workplace tasks that may cause a significant environmental impact. Determine the roles or job function of people commonly undertaking those tasks. There should be written procedures that outline the steps to take and the operating criteria that must be in place. These can form the basis of the training program.

2. Make the training measurable
Develop competency criteria for each of the high risks tasks that may cause a significant impact. Ask “What should any person be able to do before they are allowed to work without supervision? What do they need to know? What level of language, literacy, and numeracy is required for them to function effectively?” Create a minimum set of performance criteria and a method of assessing individuals against them. For example: an observational checklist or a verbal or written test.

3. Cater for individual differences
Individuals who will be acting in the above roles may have been assessed as having skills and knowledge at a lower level than the minimum acceptable standard. Decide on the best method to address any identified weaknesses. Different approaches include one-to-one supervision or mentoring, tool box talk, an in-house group training course or a public training course by a Registered Training Organisation (RTO).

Recognise existing knowledge, skills and job-related experience when planning the approach to training and assessment. Develop training materials that are tailored to the learner’s level of LLN. In mixed groups this can be a challenge so include alternative techniques to support those with LLN difficulties.

4. Keep records
Keep records of the results of competency assessments and the actions taken when the learner was regarded as not yet competent. Retain records of training content, training provider’s qualifications and participant’s names. Even if the training is a simple “toolbox talk” you must keep a list of attendees with their signatures to confirm that they received the training.

Remember: “If there are no records, it didn’t happen”

5. Evaluate the effectiveness of the training
All elements of the training program should be evaluated to determine whether the goals of the training have been met. Are people competent? Have there been any incidents or near misses? Are people aware of how their workplace tasks may cause a significant environmental impact?

Change the training content, techniques or provider to correct any weaknesses or deficiencies so that the training program improves over time.

Enviroease has 17 years experience in Environmental training delivering on-site customised courses direct to clients. We also conduct Nationally recognised management system courses (ISO14001:2015;  ISO45001:2018 and ISO19001 auditor training) on behalf of Exemplar Global accredited RTOs such as NCSI (now BSI) and SAI Global.

Call me, (Suzy) to discuss how I can help with training and workshops for staff at all levels, including Senior Management teams through all levels of the organisation. .

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Opportunities emerge in carbon and energy

If one or more of your company’s facilities has some carbon and energy saving ideas that haven’t come to fruition, now is the time to firm up the program with quotes and calculations of CO2-e reduction potential. The 2015 financial year will offer smart companies the chance to benefit from new Federal Government rebates.

While support for renewable energy generation has waned under the Coalition Government, recently released draft legislation has some interesting features to note. Consistent with Canberra’s intention to commence the Direct Action Plan following repeal of the carbon tax sometime later this year, the government released the Emission Reduction Fund White Paper earlier in May.

Under this legislation a much wider range of people and businesses will be able to plan one or more emission reduction projects and enter into a contract to secure funding from the Federal government prior to implementation. The Clean Energy Regulator will have an expanded role to manage this process.

The new legislation builds upon the Carbon Farming Initiative (CFI) introduced under Labor, that provides for land based and certain waste sector projects.  Reforesting and revegetating marginal lands, improving agricultural soils and managing savannah grassland fires will remain and there will be arrangements for existing CFI projects to transition over to the new scheme. The Carbon Credits (Carbon Farming Initiative) Amendment Bill 2014 outlines how to register projects, the methodologies, reporting, auditing and purchasing of Australian Carbon Credit Units.

Projects will need to be new and not required by law or unlikely to occur because of other state, territory of federal government funding. Methods will be approved by an independent Emission Reduction Assurance Committee setting out the rules for estimating reductions so they are both real and additional – that is, wouldn’t have occurred under “business as usual”. A menu of Emission Reduction methods will be released enabling the proponent to choose the method that best suits the project.

Of interest to many more businesses will be the inclusion of sector wide activities such as increased energy efficiency in homes, industrial facilities, commercial buildings, upgrading vehicles and improving transport logistics. Examples of more specific sector activities include reducing electricity generator emissions and capturing waste coal mine gas and the currently popular capture of landfill gas for generating energy. As reducing carbon emissions for many businesses focuses on cutting  electricity and fossil fuels, the steep energy price hikes in recent years already give a strong incentive to implement energy conservation measures.   After all cheapest watt is the “negawatt” – the one you haven’t had to buy.

But where the cost-benefit ratio or ROI of a new initiative is considered borderline, a  firm contract  for the purchase of ACCU’s can be used to obtain secure finance from banks and other financial institutions.

Enviroease can assist your business by guiding you through our Carbon Reduction Program.  This will highlight the opportunities and costs that are open to your company in relation to energy and greenhouse such as government funding in the State(s) of Australia within which you operate.

To find out more about how we can assist you with carbon and energy improvement initiatives us on 02 9411 1764

 

 

 

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A view from the inside

Successful audits are a win-win for the community and for businesses wanting to prove to themselves and others that they do what they say they do . By examining a business from the inside out an auditor confirms that the company is meeting the expectations of all interested parties.

Let’s think of the analogy of clothing.

When garments are viewed from the outside in there may be a glossy brand image, attractive packaging, convenience features.  Only when the clothes are turned inside out do the seams, patterns and structure become visible and understood.

What you see is the other side of the same thing. The garment hasn’t been deconstructed – just viewed in a different light, in all its reality, worts and all. The strengths and positives are seen and admired – the reinforced seams and new, unfaded materials and the creative effort gone into its design. But a closer look reveals some weaknesses – the fraying hems, broken stitching, worn fabric and repaired holes.

Just like a jumper that looks OK when its being worn, the deterioration of a company’s standards relating to environmental protection are not immediately apparent to key stakeholders – senior management, customers, the community, financial institutions and government regulators. Not until something unfortunate happens.

Like a loose button or pulled thread there’s been a deterioration – a few people left untrained, a couple of procedures not followed, a key piece of pollution control equipment not maintained. And so forth.

The loose thread may be spotted and repaired in time but when left unattended, things begin to unravel. In time the loose button will fall off  – there’s a major pollution incident or regulatory breach along with the high price of clean up, medical costs, fines, legal fees and loss of company reputation.  Ouch!

All elements of an Environmental Management System – like the level of training and competence and the effectiveness of operational controls – need to be rigorously checked by a program of regular internal and external audits.

The close scrutiny of a good auditor will warn the business owner(s) of weaknesses and threats so that corrective action can be taken before it is too late.

If your company’s management system does not adequately cover environmental issues at present we recommend an Initial Environmental Review. This is the first step towards developing an Environmental Management System (EMS). In many cases an EMS can be most simply and effectively implemented by integrating Quality and/or Workplace Health and Safety.

How we can help

Enviroease consultants have years of experience in both auditing and system design. Please feel free to contact me (Suzy) by email at suzanne@enviroease.com.au to discuss your needs for independent EMS, EMP or environmental compliance audits.

 

 

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Don’t just survive….thrive!

People often ask “what is sustainability?” It means maintaining the quality or condition of something into the future. But  this begs the question – “what is it we are trying to sustain?”

Economists may focus on maintaining economic growth and place a high value on GDP and jobs. Conservationists may desire to maintain environmental quality and place a high value on species and ecosystem biodiversity.  Social justice advocates may desire to maintain social systems and place a high value on human rights, equality and the eradication of poverty. So in recent years the word “sustainability” has come to mean a basic level of economic AND social AND environmental sustainability.

What does this mean for Australian businesses?

Business owners may desire to sustain an income to retirement, pass a viable business onto family members or protect shareholders’ investments and value. So it follows that, as a minimum, businesses must be economically sustainable to simply survive.

But businesses that embrace social sustainability tend to thrive. They maintain mutually beneficial relationships with employees, contractors, suppliers, customers and the local community. These relationships often have the financial benefit of increasing sales and the environmental benefit of a green supply chain. They create a positive company profile and customer and community support.

Businesses that embrace environmental sustainability  tend to thrive even more. They minimise their use of resources such as energy, raw materials and water.  They eliminate or reduce the amount of hazardous materials, emissions and waste. They in turn, reap financial benefits from reducing input costs and waste disposal fees through to eliminating the high cost of clean up, lost time, rehabilitation, fines, legal fees and customer backlash.

Increasingly business owners and shareholders are taking a broader view of risks by considering the effect that a business may have on the environment and people.   They aim to continually improve their performance in order to thrive in today’s complex and demanding world.

 

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One small paradox

The idea that human race can achieve more with less seems like a paradox. The dominant economic paradigm that more economic growth creates more happiness and wellbeing is starting to be questioned by economists and decision makers.

At the same time there is a cultural shift occurring. More and more individuals are perceiving themselves as tiny parts of a greater whole, as citizens of the planet, governed first and foremost by natural laws. The paradox is that although each person sees themselves as tiny and insignificant in the total scheme of things, they also see themselves as free to make rational choices to live within natural planetary boundaries.

                    “I am small but I am part of something big”

The humbling realisation of smallness, rather than making one feel powerless leads to empowerment. As individuals with a common goal, people can view themselves as global citizens who can easily connect with likeminded people living in most any part of the world.

The fact that there is a transition already happening to this unstoppable idea is clear.  It manifests in micro technology, small-localised markets and consumer choices to smaller, more efficient cars and houses.

Western society is transitioning to a new era, hastened by a new wave of technological advancement, which is connecting people from all walks of life. As business and community leaders we need to embrace this change.

There are three areas that are most often linked with unsustainability; population increase, production of goods and services and the use of fossil fuels.  Each of these areas has the potential to transition from large to small. Population is set to stabilise at 9bn around 2050, lean manufacturing has taken on in a big way and renewables have the highest growth rate of any energy type.

The industrial revolution of the 19th C the paradigm was “big is better” is being supplanted by “smarter and more efficient”.

 

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Turning the tide of ocean exploitation

A large expansion of marine sanctuaries, stronger enforcement of laws to prevent illegal fishing and better consumer information are the keys to protect marine biodiversity and fish stocks.  Seafood is a food source for 3,000 million people worldwide according to the Food and Agriculture Organisation of the US (FAO) (6).

In 2012 the Australian government created the largest network of protected marine areas anywhere in the world…. a great step forward but according to the IUCN and UNEP (1) only 1.6% of the world’s oceans have this level of protection and continue to be at risk of overexploitation.  The world’s oceans are the last frontier, a modern day example of Gareth Hardin’s  “tragedy of the commons”.

This is because the greatest risk to global fish stocks today is overfishing. According to another study from the FAO, (2) only 15% of fisheries are considered under or moderately exploited meaning they are able to produce more than their current yields.  The proportion of marine fish stocks that are overexploited or collapsed has increased considerably in recent decades and was valued at up to US$36 billion in 2000 by one study published in the journal Bionature (4).

An international agreement that balances biodiversity protection with sustainable management of seafood resources has the potential to set up the framework for international cooperation on this important issue.  According to one report from UNEP (5), a priority is the removal of unrealistic quotas and government subsidies of US$27,000million/yr that encourage an expansion capacity “by a factor of two relative to the ability of fish to reproduce”.

Ultimately better consumer information and labelling are the keys to successful transformation of the fishing industry. While one research study (3) indicated that in 2007 only 7% of fish products were certified as coming from sustainable fisheries, the number of certifications is now rapidly increasing. Market changes are being driven by some major supermarket chains and branded canned fish producers implementing sourcing policies that favour certified Marine Stewardship Council  labelled seafood.   The Australian Marine Conservation Society is an NGO that provides an on –line sustainable seafood guide and an phone “app”. These can be accessed at: http://www.sustainableseafood.org.au/Sustainable-Seafood-Guide-australia.asp?active_page_id=695

Greenpeace have produced a guide to the canned fish products currently on Australian supermarket shelves. Access the guide at: http://www.greenpeace.org/australia/en/what-we-do/oceans/Take-action/canned-tuna-guide/

There are two simple questions to ask….  Firstly “Where does this fish come from?” and secondly “How has it been caught?”

Stronger labelling and an informed and enlightened public that is in possession of the facts have the potential to turn the tide 0f ocean exploitation.

 

References:

1)  IUCN and UNEP-WCMC (2011) The World Database on Protected areas  http://www.wdpaorg

(2)  FAO (2010) The State of the World Fisheries and Aquaculture (2010), Food and Agriculture Organisation, Rome

(3) Jacquet, J. et al Conserving wild fish in a sea of market-based efforts. Oryx 44(1) 45-56

(4) Srinivasan, U.T et al (2010) Food security implications of global marine catch losses due to overfishing. Journal of Bioeconomics 12, 183 -200

(5) UNEP ( 2011)Towards a Green Economy: Pathways to Sustainable Development

and Poverty Eradication – A Synthesis for Policy Makers. United Nations

Environment Programme, St-Martin Bellevue

(6) FAO (2011). Code of Conduct for Responsible Fisheries. Food and Agriculture

Organization, Rome   http://www.fao.org/tc/resourcemobilization/ifas/ccrf/en/

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Which office paper is the most sustainable?

With logging of old growth forests still a contentious issue in Australia and rainforest destruction continuing across the globe, companies and individuals need to think carefully about how to exercise their purchasing power if they desire a sustainable pulp and paper industry.

Now that technology has enabled the electronic storage of documents, environment and sustainability policies should focus on elimination of paper as the number one priority with a long term goal of the “paperless office”.  Such a transition presents a win-win for the environment and the economy due to the productivity gains of reducing office clutter together with easy retrieval and safe storage of records.  In the short term companies can reduce the consumption of paper with double sided printing as the norm, carefully implemented so that people don’t make mistakes and re-print.

The big question is that when its necessary to buy paper, which one is the most sustainable?  In an effort to help decision makers make sense of the many eco-labels that appear on reams of office paper, the Buying Better Project at the Total Environment Centre in Sydney released a useful policy on Printer Paper dated December 5, 2012.

They don’t endorse any particular product but suggest that the most important buying criteria are in the following order:

  1. Recycled content with 100% ideal and verification against ISO14021 desirable.
  2. A label from  a recognised sustainable forest management certification body such as the Forest Stewardship Council( FSC) or PEFC.
  3. Carbon neutral or carbon reduced,  if it is verified by a recognised 3rd party such as National Carbon Offset Standard (NCOS).

The Buying Better Project guidance is the result of a simplified life cycle assessment (LCA) process which determined the most significant (material) stages in the lifecycle of office paper to be raw material (extracts and processes) and  manufacturing. Download the guide at: http://www.greencapital.org.au/projects/buying-better.html