What gets inspected gets done

There is now a bewildering variety of government schemes to encourage business to be friendlier to the environment. Catherine Golds says the way out of the maze is through an environmental management system

As government concern to reach targets set by the Kyoto Protocol filters through to business, we see a range of measures designed to encourage organisations to reduce their environmental impact.

The Climate Change Act, legally binding since November 2008, commits the UK to cut its carbon emissions by at least 60% by 2050. Five-year carbon budgets, the first of which was set on 1 June, will limit, by law, the total emissions of our whole economy.

While some view this with trepidation, others will undoubtedly benefit. Dynamic businesses will see it as an opportunity, as the need to invest in low-carbon alternatives becomes a key driver to economic growth.

A certified Environmental Manaagement System (EMS) will help businesses reap long-term results far beyond merely managing environmental impact. There are a variety of ways in which having a certified EMS can directly help organisations.

The Climate Change Levy, Carbon Reduction Commitment, EU Emissions Trading Scheme, Climate Change Agreements – the raft of government schemes and targets can be confusing even to the most experienced environmental manager. An EMS will help an organisation work through these systematically, look at environmental impacts in detail and highlight areas of particular concern to be directly addressed.

For example, if a large company with big headquarters was concerned about the amount of Climate Change Levy (CCL) it was required to pay, it could pinpoint energy reduction as a key objective within its EMS and could, with good management and staff engagement, significantly reduce its CCL payments.

Under the Climate Change Agreement (CCA) energy intensive organisations can have CCL payments reduced by 80%. However, as of 1 April, organisations that do not reach targets set under the CCA may be subject to recovery of relief and may have to pay back the 80% reduction. This could amount to an exorbitant amount but with an EMS in place organisations can manage their energy consumption, ensuring that they work towards the targets set for them within the CCA. If an organisation sees a sudden increase in business that results in their not being able to reach targets set in the CCA but can still show that it is working to a strict and certified EMS, there could possibly be grounds to argue against the recovery of relief.

The Climate Reduction Commitment (CRC), which will be introduced with a footprint year in 2010, is a mandatory scheme to help businesses and organisations, such as supermarkets, water companies, banks, local authorities (including state-funded schools) and all central government departments, reduce their carbon footprint. The CRC allocates each organisation a carbon dioxide allowance and participants that keep within their allowance can sell any surplus and generate revenue. The EU Emissions Trading Scheme is a similar scheme already in operation.

The CRC results will be published as a league table, with top performers receiving bonuses. It is likely that this scheme will become a key tool to reach government targets and will be important for the businesses involved, both for financial and reputational reasons. A certified EMS will help organisations target areas where energy usage is high, particularly those with energy intensive facilities like supermarkets and large offices, and will pinpoint measures to reduce this.

Environmental legislation is constantly changing. By having an EMS that has to be reviewed on an annual basis, organisations have the opportunity to pinpoint changes and updates that will affect them and to make any necessary internal changes in good time. Organisations with a management system are therefore less likely to fall foul of legislation – something that can come with heavy costs.

As legislation is open to change and revision so are the various environmental standards, that are constantly updated and or added to. For example, the new energy management standard, ISO 50001, will be introduced by the end of 2010. Again, an audited EMS will ensure that an organisation is up to date with new standards.

Competitive advantage

Companies that have an EMS have a competitive advantage over others. With the ever-increasing demand for environmental consideration, more and more companies are beginning to scrutinise their supply chain. If two companies are tendering for the same contract – one company with an EMS certified to an environmental standard and the other without – it is more than likely that the job will go to the company that is able to prove that they are working to a comprehensive EMS that is independently verified.

Consulting Engineers, Semple & McKillop have an EMS as part of their integrated management system. Having a recognised EMS is an effective way for them to demonstrate their longstanding interest in and commitment to the environmental sector. By gaining recognition for their environmental performance and expertise Semple & McKillop are able to demonstrate compliance with industry recognised standards, legislation and best practice, which is particularly relevant when the company tenders for public sector work.

Far-sighted organisations will see that an EMS will actually save them money in the long term. Although there is a cost for certification, most NQA clients report that their certified EMS has helped them save money on a variety of simple, everyday processes. From buying in bulk to save packaging, to switching monitors and printers off rather than leaving on standby, to introducing effective recycling schemes, to ensuring that they meet legislation and are not therefore opening themselves up to the possibility of being fined.

Merseyside Fire and Rescue Service took this route. Its two key objectives were to reduce and streamline waste and to reduce consumption of energy and other utilities. The organisation looked at all its operating procedures, focusing on prevention of pollution, compliance with legislation and continual improvement of environmental performance, asking “is this the best way of doing things?” This produced real efficiency savings. For example, prior to the review there were five councils collecting waste from the service’s 26 fire stations. When the contract was put out to tender and awarded to a single collection agency there was an immediate cost saving of £5,000 a year.

Use of natural resources was also reduced and the service has saved over £30,000 in domestic water consumption charges over the last three years through leak reduction and water minimisation schemes.

In a recession, it is all too easy to decide it is time to cut corners or abandon new processes. But an EMS certified to an internationally recognised standard is far less likely to be abandoned than a more casual system of working. This means the savings that come with good environmental management continue through leaner times when savings are more readily appreciated.

For an organisation to maintain its ISO14001 certification, its EMS has to be independently audited on a regular basis. The audit provides an incentive to keep going and encourages continued improvement of the systems that have been put in place. As the old adage says: “What gets inspected, gets done”. This enables organisations to realize the long-term benefit from making significant and sometimes costly changes to procedures to improve environmental performance.

An EMS can directly help organisations in any sector reduce their environmental impact and reap benefits from government schemes, to position themselves against their competitors and to save money.

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