Posts tagged ‘Risk Management’
Extended Producer Responsibility: Recycling for the 21st Century
Dania Nasser
In April, Dania Nasser, a graduate student at Yale University and a member of NAEM’s Emerging Leaders group, sat down to speak with Michael Washburn, Director of Sustainability at Nestlé Waters North America, about why the company is supporting an innovative approach to recycling called extended producer responsibility (EPR).
DN: Michael, what exactly is EPR?
MW: Common in Europe and Canada, EPR requires industries, such as the beverage industry, to pay for the collection and recycling of their products once they reach the end of life. We hope to bring the financial responsibility of recycling back to the industry, while collaborating with municipalities to increase access to curbside recycling and recycling away from home.
In 2010, Nestlé Waters North America (NWNA) supported the launch of an EPR program in the Canadian province of Manitoba, featuring four key elements: curbside recycling, public spaces recycling, commercial/institutional recycling and a public education plan. Results thus far have been encouraging, and will provide key learnings for EPR in the U.S.
DN: Why does NWNA support EPR?
MW: At Nestlé Waters, we seek to capture and reuse every Polyethylene terephthalate (PET) beverage container, so we put ourselves on the front lines of advancing recycling, whether it is in the lab, the field or at the policy level. While PET containers for bottled water make up less than 1 percent of all U.S. municipal solid waste, much work remains to ensure these, and all valuable recyclable materials, stay out of landfills.
It’s really in our best business interest as well: EPR serves as a risk-reduction strategy around our materials. Volatile commodity prices are an issue for us, and the ability recoup materials can help stabilize our costs.
To evaluate how to get our bottles back for creation of recycled PED (rPET) bottles, we examined a variety of recycling programs and found we’d need a multi-pronged approach that includes institutional and commercial recycling, as well as curbside and away-from-home. We see EPR as the only way you can do it, by folding fees into a broad variety of packaging, isolating them – importantly, outside of government – and then using funds derived from those fees to meet recycling goals that are set by state government.
Speaking of recycling goals, we hope that EPR will help to double U.S. recycling rates for all PET plastic bottles to 60 percent by 2018, a Corporate Citizenship goal we set in 2008.
DN: Some states have redemption incentives for in place for people. Did you examine this approach as well?
MW: We don’t want to dismantle bottle bills, but we do want to out-perform them, and so we are focusing our current efforts on non-bottle bill states. But there are other challenges to consider. Among other issues, bottle bills reinforce the notion that plastic bottles and beverage containers are the problem, when, in fact, these are only part of a broader societal problem in which too much valuable packaging material is going to landfills.
We want to have a deliberate, fact-rich dialogue on what EPR is and how it works, so we are working to launch EPR in states that don’t have a bottle bill, but have good recycling infrastructure and support in place, like Minnesota and Maryland. This will mean we can collaborate around EPR as a new model, without having to delve too far into the relative wisdom or merits of bottle bills.
In addition, we want to engage the kinds of stakeholders who traditionally support bottle deposits so they can come with us on this journey and understand that we can get higher rates of recovery with a different tool, and – from an environmental and efficiency standpoint – can ultimately out-perform bottle bills.
DN: What kinds of industry players and other stakeholders are you working with in support of EPR?
MW: We’re working with a really broad range of stakeholder groups, including consumer product companies, beverage companies, various trade associations, commodity groups, private haulers, municipalities, state legislatures, environmental NGOs, grocery retailers, other retailers, the forest product industry and more.
I’ll share one example of a stakeholder group. Recycling Reinvented is a 501(c)(3) nonprofit organization committed to advancing recycling rates of waste packaging and printed material in the U.S. through an EPR model that would require brand owners to develop and fund effective recycling programs. We are directly supporting Recycling Reinvented’s efforts, both through funding and our CEO Kim Jeffery’s leadership as a member of the organization’s board.
In addition, many people are aware of a dialogue process facilitated by a group called Future 500 that has brought together 30 organizations to talk about the best attributes of an EPR program that could work in states in the U.S and how to craft a legislative package and a strategy to successfully pass that package. We’re going to try and move legislation in 2013.
DN: Obviously, you’re hoping for the legislation to be successful. What’s its best selling point from a societal and government perspective?
MW: This is really the most rational approach to what is a challenging dynamic around the disposal of valuable materials in this country. Taxpayers should be uncomfortable with contributing to a system that brings only a 30 percent recycling rate for plastic bottles. So this is deeper than our own interests in the issue. We’re going to see a louder drumbeat growing over time from the standpoint of commodity associations that want this material back, municipal governments who are fiscally burdened by the current system and stakeholder groups that think that companies should shoulder this responsibility. I think that’s where our broader culture is headed—more and more, companies are expected to take responsibility for their products, from the sourcing of ingredients to disposal of packaging.
Dania Nasser is completing a Masters in Environmental Management at Yale University. She is Director of Environmental Affairs at a New York law firm specializing in environmental and construction law and a member of the Board of the Manhattan Chamber of Commerce Green Finance Committee. Ms. Nasser has an undergraduate degree in environmental engineering and a law degree.
Five Approaches to Managing Occupational Musculoskeletal Disorders
Walt Rostykus
While working and benchmarking with a wide variety of companies, I hear a range of interpretations of what constitutes an “ergonomics program.” Unfortunately, the term is being used to describe a mix of approaches (in addition to ergonomics) to managing musculoskeletal disorders (MSDs).
Several leading organizations are in the process of evaluating and changing their programs to simplify, improve focus and improve efficiencies in addressing and preventing MSDs. Currently, there are five general, but very different, approaches used to manage MSDs. Companies use a few, some, or all of these to reduce losses resulting from these types of injuries.
1. Change the Work and Workplace: This approach focuses on the design of new jobs, or changes to existing workstations, tools and equipment to better fit the population doing the work. This is occupational ergonomics, which has been defined by the National Institute for Occupational Safety and Health (NIOSH) as “The science of fitting workplace conditions and job demands to the capabilities of the working population. Ergonomics is an approach or solution to deal with a number of problems – among them are work-related musculoskeletal disorders.”
The most effective workplace changes are engineering controls, which are adjustments and changes in the physical workplace to ensure that the reaches, forces and distances are within the acceptable limits of the workforce. This means designing the workplace to fit people, from the fifth-percentile female to the ninety-fifth-percentile male, to prevent exposure to MSD risk factors for most workers. Engineering controls have been proven to be effective and efficient through research and benchmarking studies.
A secondary level of control is administrative controls, or changes to the administration of work, like job rotation, rest breaks and slowed pace. Unfortunately, administrative controls do not reduce or eliminate the presence of MSD risk factors; they just reduce the exposure time. They can also create additional work and challenges for managers and supervisors as they shift people between work task assignments.
Both of these types of controls are best supported by ergonomists, engineers, and professionals qualified in ergonomics.
2. Change the Capability of the Person: This approach is based on trying to change the capabilities, fitness and stamina of the individual doing the work. This is an element of fitness and wellness programs, and includes stretching, exercise and conditioning. The focus is on changing the individual employee and is dependent upon the willingness and participation of people, as well as their existing physical condition.
Although some organizations mandate stretching before and during work, many find it a challenge to get people to participate in stretching and wellness programs. In addition, company-mandated stretching programs have not been proven to be effective in preventing MSDs.
Unfortunately, employers have limited influence on the personal health and wellness of their employees, and have no control over pre-existing conditions. This approach is typically supported by fitness trainers/specialists, physical therapists and occupational therapists.
3. Change how the Person Performs the Task: This approach is based on getting people to behave differently in hopes of reducing exposure to MSD risk factors. This is behavioral modification, and may include behavior-based safety programs, training and awareness campaigns, and use of body mechanics. This requires people to change their perceptions of work and risk, and change how they perform work (consistently throughout the day, week and their careers).
Even when behaviors do change, they rarely have a significant impact on preventing exposure to MSD risk factors. Managers have expressed their frustrations on “getting people to use safe working practices.” This approach is typically supported by behavioral safety professionals/programs, training and fitness trainers.
4. Fit the Person to the Task: In this approach, the focus is on the individual employee (or candidate), measuring their physical abilities (strength, reach, range of motion), and matching their individual capabilities to the demands of work tasks. This is accomplished by conducting a Functional Job Analysis and Pre-Work Screening to match the results to Functional Job Descriptions.
It requires an investment in performing tests on each employee and the time to match them to the physical demands of a task. This practice was in favor in the 1960’s through the early 1980’s but appears to be waning. It is our experience that 15 to 30 percent of U.S. companies still practice this approach. Companies in which manual material handling and field tasks are common typically have these programs in place.
Physical therapists can provide valid test methods to help match the capabilities of an individual to the physical requirements of a task.
5. Fix the Person: When people experience an MSD or sprain/strain injury, they must be diagnosed and treated, and then managed in their return to work. This is medical management, a reactive program to reduce the losses due to injuries that have already occurred. The need for good medical management is totally dependent on the exposure to MSD risk factors in the workplace and the effectiveness of the ergonomics, fitness and job placement programs in place. A medical management program is best supported by health care providers (nurses and doctors) qualified in occupational health.
So, how does your organization manage MSDs?
What approach or approaches do you use?
What has worked for you and what hasn’t?
What changes have you made to improve management of MSDs?
Adding the Big “S” Doesn’t Always Make it Sustainable
Mark C. Coleman
Does it seem as if environmental, health, and safety (EHS) professionals are getting longer titles? In the past year I have participated in many conferences and workshops, including NAEM’s well-attended 2011 EHS Management Forum, “EHS & Sustainability Success in the New Economic Era” in Tucson last fall. Call it a qualitative trend, but more EHS professionals now have “Sustainability” as part of their professional title. This should come as no major surprise, particularly as companies, small and large, begin to formally address sustainability within their daily operations, strategic planning and management of their enterprise.
Sustainability is serious business and it is the new and in-vogue “big S” confronting stakeholder engagement, current affairs and future competitiveness of corporations. Understanding the business context of, and taking action on, sustainability, requires support and engagement from all corporate functions (i.e., C- suite, EHS, legal, marketing, HR, public affairs, finance, manufacturing, and so on). Corporations can gain or lose ground on the “big S” depending upon how they align internal resources and pursue sustainability as a business strategy.
While this is anecdotal, it seems as if more companies have added the “big S” of sustainability to their traditional EHS functions more rapidly in the past two years. This begs the questions: Are EHS organizations equipped and prepared to deliver upon the “big S”?, Is EHS the right corporate function to lead the “big S”?, Is the “big S” truly being addressed in the company, or is it simply an additional title to maintain appearances?
These questions are highly consequential, not only to the viability of addressing sustainability in a deliberate and strategic way, but also to the success of the EHS organization, and the long-term performance, reputation and impact of the corporation. Given the challenges of the global economic environment, and amid many internal-and-external stakeholder pressures, many organizations are facing resource and talent constraints in trying to address all issues or being all things to all people. And, another responsibility, albeit a very ambiguous one at that in the “big S”, can tax those already-constrained resources.
So what to do? The following questions provide a framework for initiating critical thinking behind whether the “big S” should be part of your EHS organization, and to what degree your organization is prepared to assume responsibility for sustainability within your traditional EHS framework.
- Strategic Orientation: Does your company have a sustainability strategy? How was the strategy initiated? Has the strategy been adopted? Who is responsible and accountable to ensuring the strategy is achieved? Have processes and metrics been established to monitor and measure the performance and impact of your strategy? How frequently is your sustainability performance reviewed? Is your sustainability strategy an integral part of your overall corporate strategy?
- Current State of Affairs: What stage of development are your sustainability efforts within your corporation? Are there formal strategies, programs, processes and people dedicated to your sustainability efforts?
- Accountability: Who is responsible and accountable for ensuring your sustainability strategy is enacted, measured and integrated throughout the company? What is the scope of influence of this individual? Do they have profit-and-loss responsibilities, or do they serve an enterprise service function? Is sustainability managed as a centralized, decentralized, or combination of both functions within your company?
- Leadership and Governance: Has your senior management embraced sustainability as a strategic priority? Has your sustainability effort been reactionary to market, shareholder, stakeholder, customer needs or issues? Has the corporate board discussed sustainability? Has sustainability been integrated into corporate governance procedures, policies or documentation?
- Engagement: Have people, policies and practices been aligned toward a sustainability strategy within your company? How has this evolution occurred? Who has led the evolution of sustainability within your company?
- Role of EHS: Is sustainability considered an extension or addition to the responsibilities within EHS? What role does or has EHS served in supporting sustainability within your company?
- Integration: Has your company defined sustainability goals and strategy within the context of its people, corporate culture, business, products, history and business strategy? What internal functional groups have participated in the sustainability dialogue and evolution? What is the role of these groups going forward?
- Enterprise Risk Management: Has your organization conducted risk mapping of emerging issues, internal and external stakeholder points-of-view and perceptions, and other factors that influence the sustainability context of your business?
- Customized Pursuit of Growth and Innovation: Are your sustainability strategy and goals customized to your business, products and corporate context? Or are they a “drop-down menu” of disparate programs, metrics and goals that “seem” to be what every other company uses? Is sustainability viewed and pursued as an opportunity for risk management, innovation and corporate growth? Or is sustainability the “extra thing” on your full plate?
EHS organizations have a great deal to offer to the sustainability agenda for business, and can serve as the center of excellence to help bring corporate functions together, facilitate discussion and support strategic planning for sustainability. Benchmarking what is being done in other companies, including assessing best practices on business sustainability, is another service EHS organizations can conduct to provide immediate value to the corporation. Corporate EHS and sustainability programs are currently, and will continue to be, compared against each other as much as your product portfolio and financial performance is evaluated by external organizations. Thus, benchmarking others programs can lead to greater understanding of how others are finding value in, and implementing sustainability, and can lead to a more strategic and purposeful advancement of the “big S” within your company.
Adding the “big S” to EHS titles needs to be a deliberate and strategic decision. And once that “S” is added, we need to be prepared to be accountable to the new title. What do you think the relative opportunities and risks are of adding sustainability to the EHS function? Should any one department have responsibility for the “big S” or should it be attached to everyone’s job title?
Mark C. Coleman manages the Clean Energy Incubator (CEI) at Rochester Institute of Technology (RIT) and is a Senior Program Manager for the Center for Integrated Manufacturing Studies (CIMS) and the Golisano Institute for Sustainability (GIS). His first book, “The Sustainability Generation: The Politics of Change and Why Accountability is Essential NOW” will be published in September 2012.
Why You Should Attend NAEM’s EHS Management Forum
Thinking about attending or exhibiting at NAEM’s annual EHS Management Forum? Hear from some of last year’s attendees about why it’s worth the trip.
Meet the NAEM Board of Directors: What are the EHS and sustainability trends to watch in 2012?
As part of NAEM’s 2012 Member Appreciation Week celebration, we sat down with members of the NAEM Board of Directors to talk about the EHS and sustainability trends to watch in 2012. Featuring Michael Miller of Dean Foods; David Newman; Mark Hause of DuPont; and Verne Shortel of NRG Energy.
Leveraging EHS/S Expertise for Non-financial Risk Management
Charles Redinger
Organizational risk management has evolved from a singular focus on financial risk, to a broader perspective that includes enterprise-wide and non-financial risks. Approaches such as enterprise risk management, strategic risk management, value risk management, etc. are morphing into an area called non-financial risk management (NFRM). A paradox in this arena is that even though risk management is important, it is fragmented, siloed and poorly integrated in companies. NFRM frameworks are weak or non-existent.
A solution to this paradox can be found right down hall in the EHS/S (environmental, health, safety and sustainability) department. But the decades of risk management experience that the EHS/S function has, often goes unnoticed because of the historic focus on regulatory compliance.
In many organizations, the EHS/S function is more mature than the broader NFRM function. The challenges that EHS/S has had to address closely parallel the NFRM challenges, such as: comprehensive risk assessment; increasing employee engagement; breaking down silos; developing reliable frameworks; and developing meaningful metrics.
The EHS/S function and its professionals have well-developed structures and skills that can be used to address the accelerate development of the risk management function. This could be bad news for some readers who are worried about more work. On the other hand, it can be viewed as an opportunity to make a significant contribution in your organization.
Consider these EHS/S structures, practices and skills:
- EHS/S departments engage with every operational function in the organization;
- They have expertise in understanding regulatory compliance and “beyond compliance” approaches;
- They have unique sets of data that quantifies and measures a wide range of operations
- They have experience breaking down organizational silos and strength in generating engagement from the C-Suite downto the plant floor;
- They have the ability to analyze data used to predict outcomes;
- They have the skills to design and employ new systems within the various operations of the organization;
- With a robust EHS/S management system, they have a platform to build a strong ISO 31000-based risk management framework;
- EHS/S auditing functions are mature and can support evolving risk management performance measurement activities.
Possibly the most valuable of the above is the ability to quickly develop a strong risk management framework (or you could say, a Risk Management System) using the existing integrated EHS/S management system. The blending of ISO 31000 into a mature ISO 14001/OHSAS 18001 EHS/S MS, provides the strong risk management framework that can unify a fragmented risk management function.
Strictly speaking, ISO 31000 is not a management system. The intent of this standard is to augment existing management structures to achieve risk management goals. Not only can an ISO 14001/OHSAS 18001 management system provide a strong risk management foundation, when augmented with ISO 31000, the converse is also true. A 14001/18001 integrated system can be turbo-charged by folding in key elements of 31000, such as 31000 pieces on “establishing the context” (Sec. 5.3) and with EHS/S integration in an organization (Sec. 4.3.4). Finally, 31000 provides the lens through which a wide range of “risks” can be identified and controlled (Sec. 5.4 and 5.5), such as those associated with social responsibility, sustainability, and supply-chain issues.
When it comes to developing a framework for addressing non-financial risks, what has been your company’s approach? What other lessons do you think we could learn from the evolution of the EHS/S function?
Dr. Charles Redinger is a principal with Redinger EHS in Harvard, Mass. He has been at the forefront of environmental health & safety (EHS) management system and performance measurement research and methods development since the early 1990s. He has been a member of the US TAG to ISO 31000 on Risk Management. He has also served as the Chair of the AIHA Risk Assessment and Management Committees, and is currently serving as a national Director for AIHA. He is a Director at the Center for Safety and Health Sustainability and is a Certified Industrial Hygienist.
Increasing EHS Value in Tough Economic Times
Mark Posson
Can we do more with less? Absolutely! This tough economy is affecting all aspects of an organization and environmental management is not immune. Today’s reality in most organizations is stagnant or declining resources and a continuing mandate to increase environmental performance. We need to resist the tendency to pull back in tough economic times and instead be introspective and improve the way we execute. We can free up the resources to meet the demands of expanding requirements by continually improving our business processes. The increased efficiency will free up resources and the increased effectiveness will boost performance and stakeholder value.
Strategically, what processes provide the greatest value to our stakeholders? Where can we get our biggest return for the time invested? These basic questions will help prioritize your improvement targets and possibly identify processes that can be eliminated. A ranked list of processes for improvement will guide your pace of change and tactical execution.
Tactically, the simplest path to improve a process is to follow the elements of lean:
- Identify the value to the stakeholder (your customers)
- Determine the sequence of activities (current process flow)
- Identify the activities that create value
- Eliminate activities that do not add value
- Identify process inefficiencies and their cause(s)
- Eliminate the cause(s) of inefficiencies
- Create the new process (future process flow)
- Implement the new process
- Measure results
The steps are simple but often challenging to implement in light of day-to-day execution pressures. We can’t expect different outcomes by following the same processes. The investment in process improvement will provide the payback in better results with fewer resources.
What strategies do you use to do more with less?
Mark Posson is the former Director of Environment, Safety and Health at Lockheed Martin Space Systems Co. and the current Chair of the city of Pleasanton’s Energy and Environment Committee. He recently began offering consulting services to help organizations improve their environment, safety and health performance.
So, who’s minding the store?
Frank Brandauer
I came up in a time when an “engaged and fair” regulator was viewed (if not begrudgingly) by industry as a necessary and valued partner. Their actions kept the playing field level, provided a measure of protection and helped industry keep its risks in focus. Whatever the relationship, regulators were seen as a real and significant force both in terms of actions and outcomes.
Nowadays there seems to be a never ending list of government branches and agencies that are unable to effectively regulate. And their failures have had profound and wide-ranging impacts on our society. From the financial sector (Enron, the mortgage collapse, AIG and Madoff) to Consumer Product Safety (imports from China, contaminated meats and vegetables) and most recently oil and gas exploration (BP and natural gas fracking), enforcement does not appear to be what it once was.
Clearly there has been a shift away from strong and aggressive regulation toward a belief in the power of corporate governance, transparency and market forces. In light of recent events, I wonder if we can afford the costs when these other approaches fail?
We are in the midst of a great social experiment, be it planned or not. My brother-in-law says that “no one ever goes to jail,” and other than a few executions in China (in extreme cases), it seems that individuals are not being held accountable for their mistakes. Thus said, I believe (and truly hope) CEO’s around the world are taking a second look at their EHS risks and efforts after seeing how their colleagues at BP have fared in recent weeks.
From the perspective of an EHS manager, the questions I think are most interesting are:
- Does reduced regulatory oversight or effectiveness actually increase or decrease industry’s EHS risk and associated costs?
- Is the amount of EHS citations still an effective EHS metric?
- Are market forces and NGO’s an effective substitution for regulation?
- Have you talked with your management today, and if so what did you say? If not, why not?
Frank Brandauer is Vice President of Regulatory Affairs at Therapak Corp., President of Avail Consulting Services LLC and a member of the NAEM board.
Spill, Baby, Spill
Stephen Evanoff
My father was fond of saying, “Learn from other people’s mistakes.” I think there are lessons about effective risk communication that EHS managers can learn from the off-shore oil drilling disaster we are witnessing in the Gulf of Mexico. The initial reactions by the Coast Guard spokeswoman, politicians, the news media and the public suggest to me a general under-estimation of the risks associated with outer continental shelf oil extraction.
The situation takes me back to the conclusion drawn by Nobel Prize winning physicist Richard Feynman when he served on the Rogers Commission investigating the Space Shuttle Challenger disaster in 1986. During his investigation, Feynman learned that the project engineers had estimated the risk of a catastrophic failure on launch in the range of 1-in-100, whereas the top managers had estimated the risk of catastrophic failure in the range of 1-in-10,000 and 1-in-100,000. Feynman famously concluded in his report, “NASA owes it to the citizens from whom it asks support to be frank, honest, and informative, so that these citizens can make the wisest decisions for the use of their limited resources. For a successful technology, reality must take precedence over public relations, for nature cannot be fooled.”
What should EHS managers learn from this latest disaster about communicating EHS risk to management and the public?
Stephen Evanoff is active on NAEM’s Board of Directors and leads EHS for Danaher Corporation. He resides in Denver, CO with his son and wife, and can regularly be found on his days off skiing, hiking, or being dragged around the neighborhood park by his Great Danes, Natasha and Neala. You can follow him on Twitter at @SteveEvanoff.
