Posts filed under ‘Compliance Excellence’
Tracking EHS MIS: An interview with Margery Moore
Margery Moore
Since 2001, NAEM has been tracking the evolution of the EHS MIS marketplace through a bi-annual benchmarking survey of users. This week we caught up with Margery Moore, Director of EHS Strategic Alliances at BNA, to discuss the 2011 survey and her perspective on the category today.
The Green Tie: What is an environmental management information system (EMIS) and how does it help improve EHS and sustainability performance?
An environmental management information system, or EMIS, is part of a billion-dollar-industry that, at its heart, is focused on compliance.
Increasingly, the data companies have has been traditionally managed (i.e. air, waste, water types of pollution impacts) is becoming a hot commodity within the context of climate or sustainability management. As such, tracking and managing carbon and greenhouse gases (GHG) is becoming more commonplace. This is reflected in the new types of modules and features available in EMIS. This growth area is also reflected in brand new software companies popping up to handle just GHG and carbon.
Does the use of a software tool make a company sustainable? No. But it does allow a company to better manage and analyze their data, and hopefully, make better decisions.
The Green Tie: You’ve been working on this survey since 2001. What changes have you seen over time?
The market has definitely grown, then contracted in the early 2000′s as larger companies bought smaller software companies to gain access to new features or customers.
More recently, we’ve seen a small explosion of sustainability and climate/carbon tracking software. Time will tell, however, what sticks.
The Green Tie: New on the survey this year is a question about social media. Why is this important?
The use of social media tools is having an impact, as environment, health and safety (EHS) professionals start to blog and use Twitter. A few years ago, that was unheard of! The public now demands transparency, and they expect their employers and companies in general to provide that.
Social media is also empowering the average consumer in incredible ways. You can use your phone and download an app, scan a product code, and Good Guide will tell you its eco-rating! Pretty cool. That is just one example.
The Green Tie: What are you most interested in learning from this year’s survey?
How social media is impacting companies, and the hot new features software providers are now offering. It also will be very interesting to see if budgeting for EMISs has changed over the past two years. 2008-9 were terrible years for spending. Have we recovered? Big question.
The Green Tie: Do you think people are surprised by how much others spend on EMIS?
Yes, frankly. Those outside the industry are shocked when I tell them it’s a more than billion-dollar-a-year industry! But, when you explain that each company probably has hundreds of environmental, health and safety regulations to comply with, each with its own data requirements to prove compliance, it’s clear that software is the only way to go. Can you imagine trying to do this in Excel or on paper? It would be a nightmare.
To benchmark your software system against your peers, take the 2011 EHS MIS benchmarking survey. Respondents will receive a copy of the results. To learn more about the latest ways to improve your EHS performance through data management, join NAEM in San Antonio on March 2 and 3 for the 2011 EHS MIS conference.
It’s never been easy being green
Stephen Evanoff
Conventional wisdom laments that today’s political atmosphere has become so polarized that the nation isn’t able to establish consensus-based national policy on contemporary environmental and conservation issues like we did in the good old days when both major political parties and the public saw eye-to-eye.
My recent reading of Timothy Egan’s, “The Big Burn – Teddy Roosevelt and the Fire That Saved America” reminded me that it has never been easy being green.
Egan, a Seattle-based, Pulitzer Prize-winning author, outdoorsman, and columnist for the New York Times, tells the story of the August 1910 wildfire that consumed an area the size of Connecticut. The fire swept through parts of Montana, Idaho, Washington and British Columbia in a matter of days, wiping out entire towns, and killing more than a hundred people.
Woven into the narrative of the events around the fire is the story of how President Theodore Roosevelt and Forest Service Chief Gifford Pinchot were able to establish vast national forests. As they put it, these forests should be for the use and enjoyment of all the people, rather than for exploitation by wealthy individuals and corporations, which had been the case until then. Most of us take the concept of the National Forests for granted. Yet Egan explains how radical the concept was at the time, and points out that there were many powerful forces aligned against Roosevelt and Pinchot.
It makes the reader wonder, how on earth Roosevelt and Pinchot did it. But, Egan shows us that Roosevelt and Pinchot had powerful forces of their own: their vision of what was best for the long-term, well-being of the nation, their energy and personal commitment, and their trust in the American people. The battle of conservation of our National Forests versus consumption by private industry continued throughout the twentieth century. As the twenty-first century emerged, conservation had ultimately prevailed due to reasons both economic and ideological.
I found the story inspiring and relevant to today’s environmental challenges, be they global, national, or organizational. When applied wisely, the combination of a clear and unselfish vision, hard work, and belief in the decency and wisdom of others can overcome significant resistance.
We’ve all fought uphill battles, albeit not on the epic scale of Roosevelt and Pinchot. I’d like to hear your inspiring stories. How have you overcome resistance within your organization to proposed EHS policies? How have you persuaded entrenched interests to support EHS initiatives with long-term benefit to your organization?
Understanding Renewable Energy Certificates
Steve McDougal
Renewable energy certificates are a vital tool for offsetting a company’s carbon footprint, but there is still plenty of confusion about how best to use them.We caught up with Steve McDougal, Executive Vice President of Marketing and Business Development for 3Degrees Inc., and asked him to shed some light on the subject.
GT: What is a renewable energy certificate (REC)?
SM: A REC is proof or verification that one megawatt-hour of renewable energy has been created and delivered to the grid. Power is traded like a commodity, undifferentiated from fuel sources, and a REC is like a claim check that corresponds to electricity generated from renewable resources. It’s purchased separately, however, so the buyer of that REC knows that they’re funding (or helping to fund) the same amount of renewable energy going into the grid as what they pull out of the grid.
GT: Who uses RECs?
SM: RECs are used by a variety of organizations. They’re used by utilities to meet state government renewable energy compliance regulations; they’re used by organizations on a voluntary basis to meet sustainability goals and by green building professionals to earn Green Power Credit points towards LEED green building certification.
GT: What kind of premium could a buyer expect to pay for energy from a renewable source?
SM: For a voluntary buyer purchasing a REC that is sourced from anywhere in the United States, the premium is about 1 percent.
GT: How do RECs help companies reach their sustainability goals?
SM: While businesses may do their best to reduce their electricity usage, at the end of the day, all organizations still need electricity to operate. Unfortunately, there is a significant environmental impact associated with the electricity that they use. The purchase of RECs mitigates this impact, while helping improve the profitability and return on investment of renewable energy projects, thereby driving more of those projects forward.
GT: When should a company use a REC versus a carbon offset?
SM: If you want to “green” your electricity, RECs are the way to go. But they are not meant to be used as a carbon offset for Scope 1 or Scope 3 greenhouse gas emissions, primarily because RECs are not a precise way to measure greenhouse gas emission reductions. They’re a proof of one megawatt-hour of clean electricity, but they are not designed to balance out the greenhouse gas emissions or mitigate the environmental impact of energy use other than electricity. Everything else outside of electricity use, from driving your car to burning some natural gas to putting another log on the fire, that’s what you want to use carbon offsets for.
GT: How do you demonstrate value/metrics for those who buy these credits?
SM: The U.S. Environmental Protection Agency’s calculator provides one look at the environmental impact RECs can have. You can enter the amount of megawatt-hours that you’re buying and it will convert it to a measure that shows the amount of greenhouse gases that would have been generated using traditional electricity generation. It then tells you how these greenhouse gas emissions correspond to the amount of greenhouse gases produced annually by an average car, or absorbed by an acre of forest in a year. Many companies also measure themselves by setting a percentage goal and increasing the amount of RECs they use over time.
GT: Can REC’s totally offset a company’s carbon footprint?
SM: One should always look at RECs as a complement to energy efficiency and conservation efforts, realizing that it’s not one or the other. The best approach is to say, ‘We’re going to reduce our energy use, costs and environmental impact as much as possible,’ using energy efficient technologies and conservation. But even if we do our best, we will still use some electricity from the grid, which will have an environmental impact. And a comprehensive environmental sustainability effort can mitigate this impact by supporting the generation of the same amount electricity from renewable energy sources as the electricity you use from the grid.
Steve McDougal is Executive Vice President of Marketing and Business Development for 3Degrees Inc. and a member of NAEM’s Affiliates Council. You can hear him speak more about renewable energy credits during the upcoming webinar “Understanding the Business Value of Renewable Energy Certificates” Jan. 13 from 1:00-2:15 p.m.
Toward sustainability: Interface Inc.’s ‘Mission Zero’ journey
In 1994, Ray Anderson, founder of Interface, Inc., outlined an ambitious new vision for his company: to achieve sustainability by 2020. Lindsay Stoda, a Senior Business Analyst with the company, spoke at the recent EHS Management Forum about the metrics Interface uses to measure its sustainability progress. This week, we caught up with Lindsay to learn more about the company’s Mission Zero goals.
Lindsay Stoda
Q: Where did the Mission Zero goal come from?
LS: Sparked by questions from customers and the ideas he encountered in Paul Hawken’s book, “The Ecology of Commerce,” our founder Ray Anderson realized that business and industry were part of the larger system that was damaging the environment and that it was not going to be a sustainable future if business continued in that direction. And realizing that it was someone’s job to lead industry down that path, he decided to ask his company and his employees to be that leader.
Q: How do you measure success against your Mission Zero Goals?
LS: We’ve always followed the “What gets measured gets managed” philosophy, so our way of being able to track and ensure that we’re making progress is through four different measurement platforms:
- Eco Metrics: Measure environmental impact
- Socio Metrics: Measure social impacts
- Quest program: Measures waste elimination
- Ecosense: Measures the activities on a plant-level that contribute to our sustainability goals
Q: How did Mission Zero change the work of Interface’s EHS department?
LS: Prior to Ray’s epiphany, we had a more traditional manufacturing environment, health and safety (EHS) department focusing on safety and compliance. Today, it’s typically the same folks because the tracking of that kind of information all kind of overlaps with the sustainability roles, except that people’s EHS roles developed a sustainability-minded focus.
Q: Can you tell me about some of your efforts toward creating closed loop products?
LS: We have a strong push to create closed loop products using recycled and bio-based raw materials. This process basically involves returning the materials in used finished product back to raw materials.
For carpet tile, there are two main components: There’s the face fiber and the fluff — the surface that you walk on — and then there’s the backing, which is different from residential carpet in that it’s a vinyl backing and it’s heavier, to hold the tiles to the floor and give them dimensional stability.
We had previously been able to cut the fibers off the front, take the backing, crumble it up, melt it down and return it to backing. But now we’re able to take the nylon fibers from the face of the products, shave them off and return them to our fiber suppliers to create new face fiber with post consumer recycled content.
We bring back both our carpet as well as competitors’ products through ‘ReEntry’—our recycling program. We collect used product back from the marketplace, run it through our process, and return backing to backing and fiber to fiber. Since the program began, we have diverted more than 100,000 tons of material from landfills.
Q: One of the goals you’ve identified is providing Environmental Product Declarations (EPDs) for all of your InterfaceFLOR products by 2012. What does that entail?
LS: We have used life cycle assessment (LCA) for several years now as we’ve tried to evaluate different materials and processes for manufacturing our products. The Environmental Product Declaration is a 10-15 page summary of the life cycle assessment results, everything from global warming potential to toxicity to resource use throughout the entire life cycle of the product. There is a lot of different environmental information out there and we thought the most useful thing for our customers would just be to give them the facts they need to make the decisions about what type of products they’d like to purchase. So it’s really the good and the bad. It’s just the facts. We collect the data and have it third-party verified to ensure it is complete and accurate.
You can hear Lindsay talk more about using metrics during “Defining the Metrics that Matter,” part of NAEM’s Best of the 2010 Forum webinar series, on Tuesday, Nov. 16. To register, visit www.naem.org.
Alcoa’s Bill O’Rourke discusses EHS and sustainability policy
Bill O’Rourke
Vice President, Environment, Health, Safety and Sustainability
Alcoa Inc.
Valuing ecosystems services
Andrew Mangan
Ecological balance is one of the three pillars of sustainable development and without it, business cannot function. All companies affect ecosystems and benefit from the services they provide, such as fresh water, fiber, and food. They also rely on regulatory services, like climate regulation, flood control and waste treatment.
Over the past 50 years, human activity has altered ecosystems faster and more extensively than ever before. That finding was supported by the UN Millennium Ecosystem Assessment – a four-year, international, scientific appraisal that was completed in 2005. It concluded that most of the critical ecosystem services assessed are being degraded or used at unsustainable levels and that this will accelerate, diminishing sustainable development options and business opportunities.
Both the World Business Council for Sustainable Development (WBCSD) and the U.S. Business Council for Sustainable Development (US BCSD) have been working on ecosystems issues for 10 years. The overarching goal is that all stakeholders – including business – recognize the real benefits of ecosystems and that the true value of ecosystem services be accounted for. We’ve used gaming theory, collaborative projects and measuring tools to move toward this goal. The value and sustainable management of ecosystems must become a more integral part of economic planning and decision-making; otherwise nature will always play second fiddle to social and economic development.
With today’s communication tools, we have a unique opportunity to help business leaders understand the value of ecosystem services and their local opportunities. The current efforts of the WBCSD are focused on identifying risks and opportunities (using the Corporate Ecosystem Services Review) and quantifying the economic value of ecosystem services and strategies to businesses. The US BCSD was one of 16 WBCSD companies and regional councils that participated in a “road test” of the WBCSD Ecosystem Valuation Initiative in 2010. A guide based on that initiative describes the effectiveness of various ecosystem valuation models and tools. The final guide is expected to be published in 2011. Details will be laid out at the fall meeting of the US BCSD in Indianapolis on October 12 and presented at the 18th annual EHS Management Forum on October 14.
The US BCSD plans to establish working groups with volunteers from interested companies to help identify projects, set implementation plans, evaluate potential funders and reach out to relevant university programs. Using a project-based focus that builds on its ecosystem experience, including the US BCSD’s green brownfields project and its afforestation efforts in the Lower Mississippi River valley, the council plans to play a role in supporting healthy ecosystems for a long time to come. After many years, it appears that today, the business community, NGOs and academics are gradually realizing they share the same concerns, but simply approach them in different ways.
Andrew Mangan is the Executive Director of the U.S. Business Council for Sustainable Development. He will be speaking about ecosystems services at the 18th annual EHS Management Forum, October 13-15 in Indianapolis.
What are the green metrics that really matter?
Carol Singer Neuvelt
The world of environmental, social and governance (ESG) performance analytics is exploding at a breakneck speed. What once was a niche field of socially responsible investing (SRI), is transforming into a vast marketplace of financial ESG-oriented indices, ratings firms, carbon reporting and mass-market editorials like Newsweek’s Green 100 ranking. Today the trend toward broader ESG and sustainability reporting is beginning to expand into auxiliary areas such as supplier questionnaires and product labeling.
With all this activity, it seems like everyone has an opinion about which metrics determine a company’s “greenness.” What remains unclear, however, is whether these types of ratings schemes can truly illustrate competitive eco-advantage in today’s complex global marketplace, or even reliably reflect strong EHS and sustainability management within a company.
When this movement took hold a decade ago, many corporate environmental leaders were excited that the external world was finally paying attention to the value their efforts contributed to the bottom line. Indeed, the establishment of the Dow Jones Sustainability Index, the growth of financial firms such as KLD and even the creation of the Carbon Disclosure Project were viewed as affirmations of their professional focus.
But recently, my conversations with corporate EHS leaders seem to reflect a frustration with the ever-growing number of requests. As environmental managers spend more and more time crunching data, they do so with little insight into who the requesting firm is, what their business interests are or how the mountains of data will eventually be used. What we do know is that some of this information is being used to make material judgments about a company’s long-term prospects. Yet does any of this data really indicate true progress?
I believe there is a need for a clear, thoughtful approach to ESG and Sustainability reporting that reflects the performance metrics that are both meaningful to a company and useful to its C-suite leadership, and relevant to external stakeholders.
To address this issue, NAEM has launched its ‘Green Metrics that Matter’ program, an audit of the field of ESG and Sustainability analytics. Our final report will identify the key players, the proprietary benefits of participating with them and the core metrics EHS leaders send to their C-suite. We believe this insight will help promote better decision-making by both corporate users and the broader ESG community.
As we continue our research, we would like to invite you to share your key metrics with us through our confidential online survey. We’d also love to hear your thoughts on this project. How are sustainability analytics changing how you manage? Are the questions you’re being asked the right ones for determining the extent of your environmental stewardship? Is this information truly helping the public better understand whether your products are sustainable? Or is it just an additional paperwork burden?
“In God we trust; all others must bring data”
By Vickie Mecsey
Manager of Global Environmental Programs, General Motors Co.
A quick poll –
- How many requests have you received about chemical use in your supply chain over the past year?
- How many data systems does your company use to track chemical use, from purchasing through disposal?
If you answered “a lot” to either of the above, you’re not alone. Data management is a hot topic for EHS professionals and I bet most have heard the above mantra from W. Edwards Deming.
From my vantage point in the Energy and Environment department at General Motors Co., I’ve certainly seen the good, the bad and the ugly in data management. We’ve been working on our data management strategy for 12 years now to move toward operating in a proactive rather than reactive mode, to improve the efficiency of our risk assessment process and to prepare for compliance each time a new regulation comes out.
Collecting data is very different from managing it and I’ve seen how a thoughtfully implemented and proactively maintained data management strategy can serve a department well when the appropriate level of planning and due diligence is applied.
What did we learn?
- There are no data fairies: Before embarking on any kind of data management strategy, it’s important not to underestimate the necessary time, manpower and leadership buy-in required to carry it out.
- Recruit your allies: We began our data management effort around the same time we introduced chemical management service (CMS) programs into our facilities. The service providers were a critical component to the overall success of the strategy. Using a standardized process that defined the format and content, we began receiving automated inputs from CMS providers who were already tracking and consolidating chemical purchasing, use and process related information.
The most important lesson we learned, though, was to find the point of diminishing returns (i.e. When is the next piece of data no longer adding value?) – and that this is different for every business.
Anyone else have a lesson to share?
Vickie Mecsey is the Manager of Global Environmental Programs at General Motors Co. She will be speaking about GM’s innovative chemical and resource management programs at the annual Chemical Management Services (CMS) Workshop on Oct. 12, 2010, co-located with NAEM’s EHS Management Forum in Indianapolis. For more details or to register, visit: http://chemicalstrategies.org/workevents_conf10.html.
Defining the S-word
Dr. Joseph Fiksel
If ever there were a word that was used loosely in the business community, it is “sustainability”. This label has been applied to almost any corporate activity that shows sensitivity to human values, from charitable donations to “green” chemistry research. Traditional environmental health and safety programs are lumped in along with energy efficiency, waste recycling, labor practices, business ethics, and diversity. For this reason, many companies have chosen to avoid the S-word, and use other terms such as “corporate responsibility” and “citizenship.”
Of course, different definitions of sustainability abound. Here’s my preferred definition: “A sustainable enterprise is a company that achieves enduring growth and superior long-term financial performance by addressing the social, economic, and environmental needs of present and future generations of stakeholders.”What’s yours?To go further, I would argue that in practice there are three levels of corporate sustainability:
Passive sustainability – This is an extension of the old compliance mentality. Companies try to respond to stakeholder expectations by adopting “best practices”such as commissioning LEED buildings and purchasing carbon credits. Essentially, this is a way to stay even with competitors and does not employ sustainability as a source of competitive advantage.
Adaptive sustainability – This is a more active approach in which companies try to be alert to changes in the business environment that could represent risks or opportunities. For example, anticipated regulations or projected shortages of critical raw materials might lead a company to redesign its products or manufacturing processes in order to remain cost-competitive. This requires frequent reexamination of sustainability goals and company practices.
Resilience - This is an emerging approach that has been adopted by a few companies such as Dow Chemical Co. and Cisco Systems Inc. Resilience can be defined as “the capacity to survive, adapt and grow in the face of turbulent change.”In a complex and tightly connected global economy, with supply chains extending around the world, it is impossible to predict future changes in technologies, markets, and political conditions. Instead, resilient companies deliberately design their products and supply chain processes to overcome unforeseen disruptions and to rapidly seize opportunities. This strengthens both short-term business continuity and long-term sustainability. Of course, corporate responsibility is an essential component of enterprise resilience.
Which business model best describes your company?
Dr. Joseph Fiksel is the Executive Director of the Center for Resilience at The Ohio State University and co-founder of the consulting firm Eco-Nomics LLC, an internationally recognized authority on sustainable business practices. His latest book, Design for Environment: A Guide to Sustainable Product Development, was published by McGraw-Hill in 2009.
EHS: Breath Mint or Candy, Support Function or Integral to the Business?
Bruce Klafter
As we embark upon our semi-regular, three-year strategic plan update here, I have been reflecting upon the above question. I strongly suspect it is a familiar question for many of you. Notwithstanding a strong commitment to environment, safety and sustainability in general, many EHS executives and managers struggle with other indicators that the commitment is thinner or more precarious than we would like.
As they say on television, do you suffer from these telltale signs?
- Is your budget shrinking? Despite some surveys that suggest EHS growth is occurring in some sectors, I rarely encounter colleagues who are boasting of budget increases.
- Is your headcount increasing? Any increases generally have to be offset somewhere for a net decrease.
- Are your executives and senior managers consistently active participants in your EHS management system (EHSMS, i.e. do they participate in inspections, do they cover EHS in all-hands meetings, etc.)? The trouble sign here is that participation can wax and wane dramatically as other business conditions intrude.
- Is EHS built into the key plans for the company, operating plans, personal performance plans, etc.? Many executives expect or demand EHS performance, but they may also resist being measured and rewarded (or penalized) for it.
- Does EHS have a seat at the table when strategic planning is taking place? There is often a perception that EHS and sustainability are no broader than compliance or that EHS programs are largely tactical in nature as opposed to strategic.
- Where does EHS report in to and does that structure meet EHS’ needs (i.e. is EHS highly placed and placed in such a way as to create synergy)? The EHS organization can be grafted on to many organizations (e.g. security, legal, government affairs, operations, HR) and runs the risk of being misunderstood or neglected.
I could probably go on, but I think the idea should be clear enough – a compelling business case for EHS and a commitment to strong performance and continuous improvement are still subject to other business conditions and constraints. Is this an inevitable and unending challenge for EHS professionals? What are you experiencing in your companies? Are you viewed as core or context, support function or key business partner, candy or breath mint?
Bruce Klafter is senior director for Environmental, Health and Safety (EHS) at Applied Materials, Inc., where he is responsible for assisting business units worldwide with compliance, industrial hygiene, product safety and various strategic initiatives. Additionally, Mr. Klafter is head of Corporate Responsibility and Sustainability for the company, where he manages a wide variety of reporting, employee engagement and other projects aimed at enhancing the company’s global citizenship programs. He also serves as an Advisory Council member for Sustainable Silicon Valley, the Association of Climate Change Officers and Next Ten’s Green Innovation Index.
