Environmental Management – is it worth it?

Waste-imageThis article will look at some essential business considerations, namely:

“Will implementing environmental measures cost too much? Are there any substantial returns on initial investments? Why spend money and resources on environmental management?”

Fines and Prosecutions
It is important to be aware of the wide-ranging powers of the enforcement authorities. For example, the Environment Agency can:

  • Issue enforcement notices, like prohibition notices (if there is an imminent risk of serious environmental damage),
  • Suspend or revoke environmental permits and licences,
  • Serve injunctions,
  • Carry out remedial works (then recover the full costs incurred from those responsible),
  • Prosecute and fine (both in Criminal and Civil law).

So if businesses do not take appropriate action to protect the environment or do not comply with regulations that prevent pollution, the above powers will be used. The powers will be used to stop businesses offending, make them restore/remediate any damage, bring activities under regulatory control and punish/deter.

Fines and Prosecutions in 2008 – Case Study 1
There were 722 cases against companies and individuals for environmental offences, resulting in fines and costs of £5.3 million. The average fine against companies was £10,080.

Two of the biggest company fines were £225,000 for breaching packaging waste regulations and £150,000 for illegal discharging from sewage treatment works.

Two individuals pleaded guilty to dumping nearly 15,000 tonnes of rubbish and received sentences of 22 months and 14 months. Another individual was jailed for a total of 32 months after being found guilty of dumping 85 tonnes of waste.

Asda Case – Study 2
Launched in 2012, Asda’s Sustain & Save Exchange scheme has saved £13 million over the past year. The scheme enables Asda suppliers to share knowledge and innovations in energy, waste and water efficiency via an online portal. Since 2005, Asda claims to have saved more than £80 million from efforts to minimise the environmental impact of its operations.

Waste – Case Study 3
Savings are possible at any stage. For example, starting at the design stage, a new healthcare centre in Scotland with an initial cost of £28,000 to introduce the waste reduction plan achieved:

  • £90,100 quantified net savings,
  • 900 tonnes of waste avoided and
  • 97% of waste diverted from landfill

Energy – Case Study 4
The Carbon Trust and Heinz improved the efficiency of a sterilising process, by halving the steam used. Heinz invested further on steam trap maintenance and repair. This saw a tenfold return on the investment through the resultant energy savings.

References_WasteEnvironmental Management System (EMS)
An EMS can be certified to Standards such as ISO 14001 and the EU Eco-Management Audit Scheme (EMAS).

A Department of Environment Food and Rural Affairs (Defra) study showed that two thirds of businesses surveyed either increased sales, or expected to do so, since implementing an EMS.  An average value of £14,961 per £1m turnover in the year following certification was quoted. This suggested a payback period of 1 month for the new business sales alone versus EMS costs.

Also cost savings were delivered for the majority of the businesses with certified EMSs with an annual average saving over 2 years of £4,875 per £1m turnover. The costs of certifying and implementing the EMS were calculated at £1,362 per £1m turnover (annual average over 2 years), suggesting a payback period of 3 months for the cost savings.

EMS Case Studies
There were some excellent examples from the DEFRA study on the benefits of implementing ISO 14001 as shown below:

An independent distributor achieved:

  • 86% waste recycling rate reducing the company’s waste disposal costs by 37%.
  • 38% reduction in company mileage changing to cleaner vehicles, fitting GPRS trackers to company vehicles and providing staff with eco-driver training. The distance travelled for business per £1m of turnover was reduced by 38% after 2 years, representing an annual saving of 22,685 km per £1m.
  • 42% reduction in energy focusing on savings measures such as energy efficient lighting, sensors to control lighting usage, timers for energy consuming appliances and installing a heat pump air conditioning system.
  • 25% of turnover attributed to EMS
  • Improved sustainability of product range which helped engage customers in making more sustainable choices.

A brick manufacturer implemented ISO 14001 in less than 12 months and achieved the following key successes:

  • Annual energy savings of over 10 million kWh (over 2 million kWh per £1m turnover).
  • Reduced annual waste by two-thirds over 2 years.
  • Annual operational cost savings of over £25,000.
  • Better legal compliance and improved relationships with stakeholders.
  • Substantial cultural change.

A plant propagation nursery was able to achieve:

  • Annual energy savings of 591,4581kWh after 4 years.
  • Major infrastructure improvement like reservoir and run-off collection systems installed which supply all irrigation water.
  • Annual operational cost savings of £41,000.
  • Reduced waste to landfill by 82% in 4 years.
  • Pioneering sustainability within horticulture.

A packaging company made:

  • Improvements to fuel efficiency and business travel.
  • 41% reduction in packaging material weight.
  • 59% reduction in landfill waste.
  • Annual energy savings of over 36,000 kWh (>3,000 kWh per £1m turnover) – a 47% saving.

Summary and Conclusion
There is strong evidence of tangible benefits from environmental management and management systems.

With the correct approach, strategy, commitment from senior staff, cooperation and buy-in from employees and competent internal and external assistance it is worthwhile to combine good environmental practices with normal working methods.

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