Environmental Strategies
Enhancing and Sustaining Organizational Performance by Implementing Pollution Prevention
©2003
Diplomarbeit
86 Seiten
Zusammenfassung
Inhaltsangabe:Einleitung:
In den letzten zwei Jahrzehnten sind die Auswirkung industrieller Aktivität auf die Umwelt immer mehr zu einem Thema in der gesellschaftlichen Diskussion geworden. Unternehmen sind heutzutage mit hohen Erwartungen in Bezug auf die Umweltfreundlichkeit ihrer Aktivitäten konfrontiert. Diese Diplomarbeit konzentriert auf das Konzept der Abfallvermeidung, das den meisten Umwelt-Strategie zugrunde liegt. Viele Unternehmen haben Abfallvermeidung bis zum jetzigen Zeitpunkt jedoch noch nicht eingeführt.
In dieser Arbeit wird Abfallvermeidung vornehmlich aus dem Blickwinkel dieser Unternehmen analysiert. Ein kurzer Überblick über die relevanten Begriffe und Konzepte wird gegeben. Danach werden die Bedrohungen für die Unternehmensleistung erörtert, die von ökologischer Gesetzgebung, versteckten Kosten, ISO Standards und den Erwartungen diverser Stakeholder herrühren. Anschließend werden die potentiellen, von Abfallvermeidung bewirkten Nutzen und Vorteile, die die gesamte Organisation umfassen, beschrieben und evaluiert. Diese sind unter anderem zu finden in Effizienzsteigerungen, Stärkung der Organisationsstruktur und Mitarbeiter-Engagement.
Eine kritische Analyse dieser Vorteile führt nicht zu fundamentalen Kritikpunkten, sondern unterstreicht eher die Notwendigkeit für eine rationale Herangehensweise an ökologisches Management. Zum Abschluss werden Empfehlungen zur Einführung von Abfallvermeidung in Unternehmen, die dieses Strategie noch nicht verfolgen, gegeben. Darunter fallen unter anderem die Integration von Abfallvermeidung in die übergreifende Strategie, Kostenidentifikation und Abfallvermeidungsprogramme, die zum Empowerment von Mitarbeitern beitragen. Schlussendlich wird betont, dass Abfallvermeidung erst der erste Schritt in Richtung nachhaltiger ökonomischer Entwicklung ist.
Abstract:
During the past two decades the impacts of industrial activities on the environment have become a prominent issues in debates on economic development. Nowadays, Companies are confronted with high expectations in terms of environmental protection. This thesis focuses on the concept of pollution prevention, which underlies most environmental strategies. Many companies, however, have not yet implemented pollution prevention.
In this thesis pollution prevention is primarily evaluated from the perspective of such firms. As a starting point a short overview of terms and concepts in the pollution prevention area is given. Following this […]
In den letzten zwei Jahrzehnten sind die Auswirkung industrieller Aktivität auf die Umwelt immer mehr zu einem Thema in der gesellschaftlichen Diskussion geworden. Unternehmen sind heutzutage mit hohen Erwartungen in Bezug auf die Umweltfreundlichkeit ihrer Aktivitäten konfrontiert. Diese Diplomarbeit konzentriert auf das Konzept der Abfallvermeidung, das den meisten Umwelt-Strategie zugrunde liegt. Viele Unternehmen haben Abfallvermeidung bis zum jetzigen Zeitpunkt jedoch noch nicht eingeführt.
In dieser Arbeit wird Abfallvermeidung vornehmlich aus dem Blickwinkel dieser Unternehmen analysiert. Ein kurzer Überblick über die relevanten Begriffe und Konzepte wird gegeben. Danach werden die Bedrohungen für die Unternehmensleistung erörtert, die von ökologischer Gesetzgebung, versteckten Kosten, ISO Standards und den Erwartungen diverser Stakeholder herrühren. Anschließend werden die potentiellen, von Abfallvermeidung bewirkten Nutzen und Vorteile, die die gesamte Organisation umfassen, beschrieben und evaluiert. Diese sind unter anderem zu finden in Effizienzsteigerungen, Stärkung der Organisationsstruktur und Mitarbeiter-Engagement.
Eine kritische Analyse dieser Vorteile führt nicht zu fundamentalen Kritikpunkten, sondern unterstreicht eher die Notwendigkeit für eine rationale Herangehensweise an ökologisches Management. Zum Abschluss werden Empfehlungen zur Einführung von Abfallvermeidung in Unternehmen, die dieses Strategie noch nicht verfolgen, gegeben. Darunter fallen unter anderem die Integration von Abfallvermeidung in die übergreifende Strategie, Kostenidentifikation und Abfallvermeidungsprogramme, die zum Empowerment von Mitarbeitern beitragen. Schlussendlich wird betont, dass Abfallvermeidung erst der erste Schritt in Richtung nachhaltiger ökonomischer Entwicklung ist.
Abstract:
During the past two decades the impacts of industrial activities on the environment have become a prominent issues in debates on economic development. Nowadays, Companies are confronted with high expectations in terms of environmental protection. This thesis focuses on the concept of pollution prevention, which underlies most environmental strategies. Many companies, however, have not yet implemented pollution prevention.
In this thesis pollution prevention is primarily evaluated from the perspective of such firms. As a starting point a short overview of terms and concepts in the pollution prevention area is given. Following this […]
Leseprobe
Inhaltsverzeichnis
ID 7101
Plesch, Joachim: Environmental Strategies - Enhancing and Sustaining Organizational
Performance by Implementing Pollution Prevention
Hamburg: Diplomica GmbH, 2003
Zugl.: Fachhochschule Reutlingen, Fachhochschule, Diplomarbeit, 2003
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Preface I
Preface
Business and the environment this relationship has fascinated me ever since I started
my studies of business administration. Conventional thinking made me believe that this
relationship had to be of an adversarial type. Once it was time for me to develop a topic
for my thesis, environmental strategies were the first area I was looking at. However, if
Professor Ron Thomas had not given me Michael E. Porter's article on resource
productivity and its implications for competitiveness, I probably had turned to other fields
of business. I was amazed when I discovered that environmental strategies, in this case
pollution prevention, can lead to competitive advantages and corporate self renewal.
At that point my decision to focus my thesis on pollution prevention was made and it
seemed just to concentrate on managers that are people like me who had not been aware
of the threats that can arise if business is carried on as usual and the benefits that
pollution prevention entails.
Over the course of three months, I have now gained quite broad knowledge on pollution
prevention strategy which involved extensive research. Some activities such as printing
out numerous articles were not as environmentally sound as I hoped. In my research
efforts and during the structuring of this thesis Professor Thomas was of tremendous help.
I would like to express my gratefulness for his assistance. Furthermore, I would like to
thank Professor Andrew J. Hoffman for his responses to my emails seeking information.
I also want to thank my family who has provided perfect working conditions and great
support during the final stages of this thesis and who has made my studies possible.
Finally, I express my gratitude for the support and encouragement I received from all of
my friends.
Joachim Plesch
March 29, 2003
Table of Figures
II
Table of Figures
F
IGURE
1:
S
OURCE
R
EDUCTION AND
I
TS
I
MPLICATIONS FOR
M
ANUFACTURING
... 6
F
IGURE
2:
P
OLLUTION
P
REVENTION
H
IERARCHY
... 7
F
IGURE
3:
L
IFE
C
YCLE
A
SSESSMENT
... 8
F
IGURE
4:
R
EGULATIONS IN THE
U.S... 12
F
IGURE
5:
I
MPACTS OF
L
AWS
& R
EGULATIONS ON
U.S. F
IRMS
... 14
F
IGURE
6:
M
ISALLOCATION OF
W
ASTE
C
OSTS
... 16
F
IGURE
7:
T
HE
ISO 14000 S
ERIES
... 20
F
IGURE
8:
J W L
EES
- F
INANCIAL
A
NALYSIS OF
P
OLLUTION
P
REVENTION
M
EASURES
... 28
F
IGURE
9:
C
ONTINENTAL
T
EVES
B
ENEFITS OF
R
E
-D
ESIGN
... 30
F
IGURE
10:
C
ONTINENTAL
T
EVES
R
EDUCTION IN
O
IL
C
ONSUMPTION
... 31
F
IGURE
11:
C
ONTINENTAL
T
EVES
F
INANCIAL
A
NALYSIS OF
R
E
-U
SABLE
P
ACKAGING
... 33
F
IGURE
12:
C
ONTINENTAL
T
EVES
M
ETAL
P
RODUCTIVITY
I
MPROVEMENT
... 33
F
IGURE
13:
C
ONTINENTAL
T
EVES
O
IL
P
RODUCTIVITY
I
MPROVEMENT
... 33
F
IGURE
14:
D
OW
C
HEMICAL
WRAP F
LOW
C
HART
... 36
F
IGURE
15:
D
OW
C
HEMICAL
P
ROGRESS OF
WRAP P
ROGRAM
A
GAINST
S
ET
T
ARGETS
... 37
F
IGURE
16:
B
ARRIERS TO THE
I
NTRODUCTION OF
E
NVIRONMENTAL
M
ANAGEMENT
... 58
F
IGURE
17:
F
LOW
C
HART OF A
F
ICTIONAL
P
ACKAGING
P
ROCESS
... 63
Table of Contents
III
Table of Contents
1
INTRODUCTION...1
2
METHODOLOGY...3
3
POLLUTION PREVENTION - OVERVIEW OF TERMS AND CONCEPTS ...4
3.1
W
ASTE
(P
OLLUTION
) ...4
3.2
P
OLLUTION
C
ONTROL
(E
ND
-
OF
-
THE PIPE
T
REATMENT AND
R
EMEDIATION
)...5
3.3
P
OLLUTION
P
REVENTION
...5
3.4
L
IFE
C
YCLE
A
SSESSMENT
...7
3.5
L
IFE
C
YCLE
C
OST
A
NALYSIS
(LCCA)
AND
L
IFE
C
YCLE
E
NVIRONMENTAL
C
OST
A
NALYSIS
(LCECA) ...10
3.6
E
CO
-E
FFICIENCY
...10
4
ENVIRONMENTAL THREATS AND CHALLENGES OCCURRING WITHOUT
POLLUTION PREVENTION ...12
4.1
E
NVIRONMENTAL
L
AWS AND
R
EGULATIONS
...12
4.1.1
Cost of Compliance with Environmental Regulation...12
4.1.2
Sample of Environmental Laws in the United States...13
4.1.3
The Environmental Protection Agency and Its Powers ...14
4.1.4
General and global implications ...15
4.2
C
OMPETITIVE
P
RESSURES
...16
4.2.1
Hidden Waste-Related Costs ...16
4.2.2
Waste Equals Inefficiency ...17
4.3
I
NTERNATIONAL
B
USINESS
S
TANDARDS
ISO 14000...18
4.3.1
Introduction to the International Organization of Standardization and the
Significance of Its Standards ...18
4.3.2
The ISO 14000 Series and the Commitment to Prevention of Pollution...19
4.4
S
TAKEHOLDERS
' E
XPECTATIONS
...21
4.4.1
Society...21
4.4.2
Government...22
4.4.3
Customers/Consumers...22
4.4.4
Employees...23
4.4.5
Owners/Shareholder...24
4.4.6
Creditors ...24
4.4.7
Green Activist Groups and Green Non-Governmental Organizations
(NGOs) ...25
Table of Contents
III
4.4.8
Suppliers...25
4.5
S
UMMARY
: T
HREATS
U
NDERLINE THE
N
EED FOR
P
OLLUTION
P
REVENTION
...26
5
POLLUTION PREVENTION: OPPORTUNITIES AND BENEFITS ...27
5.1
P
OLLUTION
P
REVENTION
C
ASE
S
TUDIES
...27
5.1.1
Case Study: J W Lees & Co (Brewers) Ltd ...27
5.1.2
Implications of the J W Lees Case Study ...29
5.1.3
Case Study: Continental Teves UK Ltd ...29
5.1.4
Implications of the Continental Teves Case Study ...33
5.1.5
The Dow Chemical Company Case Study ...34
5.1.6
Implications of the Dow Chemical Case Study...38
5.2
O
VERVIEW OF
P
OLLUTION
P
REVENTION
O
PPORTUNITIES
...39
5.2.1
Pollution Prevention Increases Resource Productivity ...40
5.2.2
Pollution Prevention Provides Cost Advantages Over Traditional Pollution
Control ...41
5.2.3
Pollution Prevention Results in Process Improvements ...42
5.2.4
Pollution Prevention Can Result in Improvements in Product Quality...43
5.2.5
Pollution Prevention Can Strengthen Relationships Within the Value Chain ..43
5.2.6
Pollution Prevention Can Be the Basis for Effective Green Public Relations ..44
5.2.7
Pollution Prevention Can Foster Employee Motivation ...45
5.2.8
Pollution Prevention Creates Entry Barriers and Pressure on Competitors ...46
5.2.9
Pollution Prevention Aligns the Company with Society's Moral Values...47
5.2.10
Pollution Prevention Minimizes Risk...47
5.2.11
Pollution Prevention Can Be the Basis for Green Marketing...50
5.3
S
UMMARY
: P
OLLUTION
P
REVENTION
I
NCREASES
U
NDERSTANDING OF
B
USINESS AND
C
REATES
C
OMPETITIVE
A
DVANTAGE
...51
6
CRITICAL ASSESSMENT OF POLLUTION PREVENTION STRATEGIES...53
6.1
E
NVIRONMENTAL
M
ANAGEMENT AS A
S
HORT
-T
ERM
, O
NE
-T
IME
O
CCURRENCE
...53
6.2
C
RITIQUE OF THE
"
WIN
-
WIN
"
NATURE OF ENVIRONMENTAL STRATEGY
...54
6.3
M
IXED
M
ESSAGES FROM
F
INANCIAL
M
ARKETS
...56
6.4
B
ARRIERS TO
P
OLLUTION
P
REVENTION
S
TRATEGIES
...57
6.5
S
UMMARY
: N
EED FOR A
R
ATIONAL
A
PPROACH TO
P
OLLUTION
P
REVENTION
S
TRATEGY
...59
7
RECOMMENDATIONS FOR THE IMPLEMENTATION OF POLLUTION
PREVENTION...60
7.1
T
HE
S
TARTING
P
OINT
: M
AKING
P
OLLUTION
P
REVENTION AN
I
NTEGRAL
P
ART OF
D
ECISION
-M
AKING AND
S
ENIOR
M
ANAGEMENT
C
OMMITMENT
...60
Table of Contents
III
7.2
S
ETTING
U
P A
P
OLLUTION
P
REVENTION
T
ASK
F
ORCE
...61
7.3
F
INDING THE
H
IDDEN
W
ASTE
C
OSTS
...62
7.4
I
NTRODUCING AN
E
MPLOYEE
-C
ENTERED
W
ASTE
E
LIMINATION
P
ROGRAM
...64
7.5
L
ONG
-T
ERM
O
UTLOOK
: I
NTEGRATING
P
OLLUTION
P
REVENTION IN
R&D
AND STRIVING
FOR
ISO 14000
CERTIFICATION
...66
8
CONCLUSION: POLLUTION PREVENTION IS THE FIRST STEP TOWARDS
SUSTAINABILITY ...68
APPENDIX 1: SUGGESTED READINGS ON POLLUTION PREVENTION ...I
APPENDIX 2: DOW CHEMICAL'S SUSTAINABILITY GUIDELINES...II
REFERENCES...III
STATUTORY DECLARATION ... IX
Environmental Strategies Pollution Prevention
1
1 Introduction
"No matter how competitive you are and how globally you trade, if you are
environmentally irresponsible someone can and will and should padlock your
door."
1
Frank P. Popoff, former CEO and Chairman of The Dow Chemical Company
During the 1990s the environmental awareness among the people living on planet
earth, especially in the industrial countries, has increased dramatically. Nowadays the
environment is regarded as being in imminent danger. This is already shown by the
fact, that most democratic parties have included environmental protection in their
party's program. In Germany the Green Party is part of the governing coalition. The
Earth Summit in Johannesburg is further evidence of how pressing the concerns about
the environment are.
Most of the blame for the alarming state of the environment is put on industrialization
and thus on the companies. Companies experience extreme scrutiny by government,
media and a growing number of "green" activist groups. Many companies have fought
environmental regulation and are confronted with expectations of environmental
performance that are quite ambitious at the first glance. Many senior managers still feel
that there must be a trade-off between ecological and economic performance, so the
less ecological requirements have to be fulfilled the better it is for the bottom line. That
is one of the reason why many companies are reluctant to take on environmental
concerns.
In the U.S. total waste adds up to an annual amount of more than 50 trillion pounds
2
,
excluding wastewater. In the EU annual waste generation is growing by 10%
3
.This
pollution, whether it is air or water pollution, solid waste, hazardous waste or excessive
energy usage, is the reason why companies have to take the blame and become
subject to dramatic public pressures. But it is also the key to a company's
environmental strategy. If pollution can be minimized or eliminated, a company ideally
would not have to fear regulation and public outrage.
While companies experience tremendous pressure to shift their focus to sustainable
economic development, many firms are concerned about the impacts of pollution
1
Avila & Whitehead, 1993
2
Hawken et al., 1999, p.52
3
Cassidy & Cooksley, 2001
Environmental Strategies Pollution Prevention
2
prevention strategies on the bottom line as well as on the organization in general.
Management of companies that have not integrated pollution prevention in their
strategy yet still seem to doubt the feasibility of those strategies. The crucial questions
is whether or not pollution prevention as an environmental business strategy can be
beneficial to a company's performance.
These concerns and doubts are evaluated in this thesis. By investigating pollution
prevention as it appears to companies that have not yet considered or implemented it,
this thesis will evaluate environmental threats to organizational performance and show
the potential opportunities that will arise through the introduction of pollution prevention.
Furthermore, a critical assessment of pollution prevention strategies and subsequently
recommendations for those companies will be developed. This thesis will discuss
pollution prevention as a business strategy, that has to be investigated like any other
strategy.
Environmental Strategies Pollution Prevention
3
2 Methodology
In the first chapter a brief overview of pollution-related concepts is given in order to
provide a common background in the following discussion. Definition of terms such as
waste, pollution control, pollution prevention are outlined. In addition, conceptual tools
in the pollution prevention field such as life cycle assessment and eco-efficiency are
explained. The first chapter is not designed to give the reader deep, comprehensive
knowledge of technical specifications of those concepts due to the complexity of these
concepts and space constraints. It is rather meant to provide a general overview and
provide a basic understanding of the terms and concepts discussed, whereas further
more detailed readings are suggested.
In the course of the second chapter threats to companies that have not yet applied
pollution prevention will be outlined. This section includes threats from environmental
regulation, competitive pressures, international business standards and stakeholder
expectations.
In the following section, opportunities that result from a thorough implementation of
pollution prevention are specified. Those range from increased resource productivity
and enhanced financial performance to increased employee morale and being a ethical
company. For clarification purposes three case studies dealing with pollution
prevention are included.
Subsequently, recommendations for a successful implementation of pollution
prevention are developed. Those recommendations are defined as general guidelines
which can be applied by all firms. Within the recommendations different alternatives
that suit different firms are given.
The conclusion sums up the information and recommendations provided in this thesis.
It also asserts that pollution prevention is only a first step towards sustainability by
highlighting research and scholarly opinions that develop and argue even more
extensive environmental strategies for the future.
Environmental Strategies Pollution Prevention
4
3
Pollution Prevention - Overview of Terms and
Concepts
In order to provide a concise and coherent line of argument it is necessary to
understand the terms and concepts used in this thesis. In this chapter a brief overview
of the terms and concepts is given. This chapter can also be used for reference
purposes during the reading of the following chapters. More detailed technical
information on the concepts presented in this chapter can be found in the readings that
are suggested in Appendix 1.
3.1 Waste
(Pollution)
To completely understand the concept of "pollution prevention" pollution must be
defined. It is essential to understand that waste and pollution are used interchangeably
in this thesis, since both terms describe the same thing. There are several definitions
for waste or pollution. Waste comes in different shapes such as water contamination,
solid waste, hazardous waste, air pollution and many more. Merriam-Webster's
Dictionary defines waste in a manufacturing setting as:
"damaged, defective, or superfluous material produced during or left over from a
manufacturing process or industrial operation : material not usable for the ordinary
or main purpose of manufacture: as (1) : material rejected during a textile
manufacturing process and either recovered for reworking (as yarn) or used usually
for wiping dirt and oil from hands and machinery (2) : SCRAP (3) : fluid (as steam)
allowed to escape without being utilized (4) : worthless material removed in mining
or digging operations (5) : a soft absorbent material that when saturated with oil
and packed in a journal of a railroad car equipped with solid bearings serve to
lubricate the journal"
4
A definition, which is rather simple but captures all the aspects of waste is given by
Paul L. Bishop:
"A waste is a resource out of place."
5
4
"waste". Merriam-Webster's Third New International Dictionary Unabridged
5
Bishop, 2000, p. 10
Environmental Strategies Pollution Prevention
5
There are many other definitions, however this one accounts for the fact that waste of
one company can still be a usable commodity for another company.
3.2
Pollution Control (End-of-the pipe Treatment and
Remediation)
Pollution control was the predominant waste management philosophy for most of the
twentieth century. It is also referred to as end-of-the-pipe treatment or remediation.
Remediation stands for the clean-up of environmental damage caused by past
practices or crises. End-of-the-pipe treatment refers to operations installed as the final
process step to prevent pollutants and wastes from being released into the
environment.
6
This basically implied that waste is handled as given. Only when waste
was produced, the company had to deal with it using landfills, filters or other
technologies to keep the waste from reaching the environment uncontrolled.
These traditional systems focused on "control of pollution after is has been generated."
7
Pollution control technologies, according to Robert Klassen, are defined "as structural
investments, such as equipment, processes or operations, that capture pollutants or
harmful by-products at the end of the manufacturing process."
8
3.3
Pollution Prevention
Pollution prevention contrasts pollution control. Pollution prevention is a waste
management philosophy that derived from the growing concern about industrial
pollution and resource depletion. Pollution prevention focuses on avoiding waste
altogether. According to the U.S. Environmental Protection Agency (EPA), pollution
prevention means "source reduction":
"A)The term ''source reduction'' means any practice which
(i)reduces the amount of any hazardous substance, pollutant, or contaminant
entering any waste stream or otherwise released into the environment (including
fugitive emissions) prior to recycling, treatment, or disposal; and
(ii) reduces the hazards to public health and the environment associated with the
release of such substances, pollutants, or contaminants. The term includes
6
Klassen, 2000, p. 129
7
Dupont et al., 2000, p. 185
8
Klassen, 2000, p. 129
Environmental Strategies Pollution Prevention
6
equipment or technology modifications, process or procedure modifications,
reformulation or redesign of products, substitution of raw materials, and
improvements in housekeeping, maintenance, training, or inventory control.
B) The term ''source reduction'' does not include any practice which alters the
physical, chemical, or biological characteristics or the volume of a hazardous
substance, pollutant, or contaminant through a process or activity which itself is not
integral to and necessary for the production of a product or the providing of a
service"
9
Figure 1:
Source Reduction and Its Implications for Manufacturing
Source: Bishop, 2000, p. 11
Bishop emphasizes that term "source reduction" is defined as "activity that reduces or
eliminates the waste at the step where pollution is created"
10
and that pollution
prevention, source reduction and waste minimization can be used interchangeably.
Figure 1 shows to which extent source reduction influences the company and its
manufacturing processes. Furthermore, according to Dupont et al., pollution prevention
9
Pollution Prevention Act of 1990
10
Bishop, 2000, p. 12
Environmental Strategies Pollution Prevention
7
also includes closed loop recycling, which should be implemented whenever source
reduction is not feasible.
11
Therefore there is a hierarchy in pollution prevention that is
shown in Figure 2. It prescribes a way of evaluating pollution issues: First source
reduction as a solution should be evaluated followed by recycling, then treatment and
as a last resort disposal.
Figure 2:
Pollution Prevention Hierarchy
Source: Bishop, 2000, p.14
3.4
Life Cycle Assessment
In order to implement feasible pollution prevention techniques, management has to
understand where pollution is generated throughout the manufacturing processes. The
solution to this question can be life cycle assessment (LCA), which is also mandated by
the ISO 14000 standards as set out below.
12
"LCA is a holistic environmental accounting procedure which quantifies and
evaluates all wastes discharged to the environment and energy and raw materials
consumed throughout the entire life cycle, beginning with sourcing raw materials
from the earth through manufacturing and distribution to consumer use and
disposal."
13
According to ISO 14040, LCA is done "by compiling an inventory or relevant inputs and
outputs, evaluating the potential environmental impacts associated with these inputs
and outputs, and interpreting the results of the inventory and impact phases in relation
to the objectives of the study."
14
11
Dupont, 2000, p. 186
12
see chapter "4.3 International Business Standards ISO 14000"
13
de Oude, 1993, p. 219
14
ISO, 1997
Environmental Strategies Pollution Prevention
8
Thus Kumaran et al. point out that LCA has three dimensions
15
:
The Life Cycle Stages, which is the physical sequence of unit processes across
the life cycle.
Analysis of multiple environmental and resource issues, which considers not
only single issues, but the trade-offs across many environmental concerns.
Assessment, in which LCA extends beyond the quantitative analysis to a point
where an evaluation or judgment is made.
Figure 3:
Life Cycle Assessment
Source: Westkämpfer et al., 2001, p. 610
The LCA process (Figure 3) incorporates four steps that are to be followed: (1) Goal
and scope definition, (2) inventory analysis, (3) impact assessment and (4)
interpretation. Although they are arranged in a consecutive manner, the whole process
should be understood as an iterative process, in which information gathered in later
steps influences earlier procedures through constant feedback.
Goal and scope definition is the starting point of each LCA. The scope of the LCA
outlining the assessed functional unit, product system, timescale, principles of
measuring environmental impacts, etc. has to be stated. The goals of the LCA should
be explicitly stated during this step, as well.
16
15
Kumaran et al., 2001
16
Westkämpfer et al., 2001, p.610
Environmental Strategies Pollution Prevention
9
The inventory analysis constitutes the collection of the information on the earlier
defined processes' environmental exchanges (in- and outputs of resources). To make
this data collection representative it usually takes place during a long period of time.
Reports on aggregated environmental exchanges per functional unit in a process and
for whole life cycles are presented after the end of the inventory analysis.
17
During life cycle impact assessment the data of the inventory analysis must be
interpreted. The goal of the impact assessment is to translate the inventory results into
potential impacts and identify problematic environmental exchanges. Again a four step
procedure is used: first the classification of environmental exchanges (asking "what is
the problem for this environmental exchange?"), then characterization (asking "how big
is the problem?"), followed by normalization (asking "is that much?") and finally
weighting (asking "is it important?") is necessary.
18
The final step of LCA is the interpretation of the impact assessment. The results of the
impact assessment have to be interpreted always keeping in mind the limitations of the
goals and scope defined in the beginning. Sensitivity analyses should be part of the
interpretation, which then serves as basis for the decision-making process and can be
weighted against other factors such as economic considerations.
19
The use of LCA can therefore pinpoint the location of pollution generation and facilitate
the effective introduction of pollution prevention. However, there are certain pitfalls to
LCA. Jan-Gunnar Persson cites "unclear system boundaries, lack of transparency and
unreliable data...[as]... well-known problems related to the use of LCA."
20
Hence it
seems clear that only a concentrated effort to perform LCA will be successful. This
means that LCA can only be implemented with sufficient commitment of financial and
personnel resources.
17
Westkämpfer et al., 2001, p.610
18
Westkämpfer et al., 2001, p.610
19
Westkämpfer et al., 2001, p.610
20
Persson, 2001, p. 628
Environmental Strategies Pollution Prevention
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3.5
Life Cycle Cost Analysis (LCCA) and Life Cycle
Environmental Cost Analysis (LCECA)
While LCA is a system to measure waste streams and identify pollution sources in
terms of metric units, it fails to assign monetary costs to those wasteful activities. This
is done by life cycle cost analysis (LCCA). Kumaran et al. define LCCA "as a
systematic analytical process of evaluating various designs or alternative courses of
actions with the objective of choosing the best way to employ scarce resources."
21
LCCA basically involves putting monetary numbers to these waste streams generated
throughout a product's life cycle. By using LCCA, "the cost of production, installation,
use and disposal are analyzed, so that a minimum total cost and a maximum benefit
are achieved."
22
Hence, by applying LCCA a company gains the ability to identify the
true costs of their products when all factors are correctly accounted for. To be truly able
to measure all costs, including environmental costs, Kumaran et al. propose a separate
life cycle environmental cost analysis (LCECA) model.
23
3.6 Eco-Efficiency
LCCA and LCECA, both help in determining the impact that pollution has on a
company's profitability. After all, these costs represent unused resources.
24
Eco-
efficiency is a concept that makes use of the LCCA data and "focuses as well on
creating value by better meeting customer's needs while maintaining or reducing
environmental impacts."
25
The first word, eco, means both economic and ecological
resources while the second word, efficiency, suggests that companies have to make
optimal use of both.
26
As a result, "needs are satisfied with less energy and material
flows."
27
21
Kumaran et al., 2001
22
Westkämpfer et al., 2001, p.618
23
Kumaran et al., 2001
24
compare chapter "4.2.1 Waste Equals Inefficiency"
25
DeSimone & Popoff, 1997, p. 3
26
DeSimone & Popoff, 1997, p. 3
27
Belz et al., 1998, p. 117
Environmental Strategies Pollution Prevention
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According to DeSimone & Popoff eco-efficiency entails seven guidelines
28
that ensure
sustainable economic development:
Reduction of material intensity of goods and service
Reduction of intensity of goods and service
Reduction of toxic dispersion
Enhancement of material reliability
Maximization of sustainable use of renewable resources
Extension of product durability
Increase in service intensity of products
Following these guidelines has positive bottom line effects, according to the eco-
efficiency theory, since new products are created that meet the demand for prosperity
along with a clean and healthy environment and at the same time costs and liabilities
associated with resource consumption, waste and end-of-the-pipe pollution control are
reduced.
29
28
DeSimone & Popoff, 1997, p. 21
29
DeSimone & Popoff, 1997, p. 21
Environmental Strategies Pollution Prevention
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4
Environmental Threats and Challenges Occurring
Without Pollution Prevention
The state of the environment has experienced an increasing amount of attention in
recent years. Companies and their impact on the environment are therefore under
extreme scrutiny. This environmental scrutiny translates into a number of major risks
that companies face if pollution occurs within their production setting. This chapter
explores those risks and the threats and challenges that have to be met now and in the
future.
4.1
Environmental Laws and Regulations
4.1.1 Cost of Compliance with Environmental Regulation
One of the most serious threats is the introduction of new environmental laws and
regulations that will affect manufacturing processes or waste management.
Compliance with these laws is considered quite costly, especially when traditional
pollution management procedures (pollution control) are installed.
Figure 4:
Regulations in the U.S.
Source: Bishop, 2000, p. 148
Government regulations tend to become stricter over time, e.g. emission levels are
tightened. The Clean Air Act for example was amended 16 times between its
introduction in 1963 and 1990.
30
The number of environmental regulations has been
increasing significantly over the last three decades as it can be observed in Figure 4.
30
Welch, 1998, p.3
Details
- Seiten
- Erscheinungsform
- Originalausgabe
- Jahr
- 2003
- ISBN (eBook)
- 9783832471019
- ISBN (Paperback)
- 9783838671017
- DOI
- 10.3239/9783832471019
- Dateigröße
- 1.7 MB
- Sprache
- Englisch
- Institution / Hochschule
- Hochschule Reutlingen – Betriebswirtschaft
- Erscheinungsdatum
- 2003 (September)
- Note
- 1,3
- Schlagworte
- umweltmanagement nachhaltigkeit produktivitätssteigerung abfallvermeidung ökologie
