The Green Signal

Managing the environment is improving business." Sceptics would dismiss that as a con line being churned out by green freaks today. But the Geneva-based International Organisation of Standardisation (ISO) is hoping corporations will be forced to think otherwise soon.

In September 1996, the agency ratified a new ISO series ISO 14000 to improve efficiency and make production processes environment friendly while cutting costs. (There is no special significance to the 14000 number -- it was the first uncluttered series that ISO found.)

The new series is designed to create standardised global procedures for corporate environmental management covering a range of issues from audits and performance evaluation to eco-labelling, life-cycle assessment and product standards.

 

The ISO 14000 series is significant because it means the standards agency has made a historical shift into the realm of public policy from its earlier narrowly defined function of setting technical standards. From the general prescriptive role it had conceived for itself with the ISO 9000 series (for total quality management), it has tightened its definitions and norms with the new series.

The thrust is on setting international standards for all processes to cut down on pollutants, which usually take the form of waste matter flowing out of a processing unit. But the ISO 14000 message is practical in intent -- recyclable and efficient production processes can translate into big savings.

The environmental norms put in place will apply across the globe. But the actual performance of specific companies will depend on the kind of legislation existing in host countries and the extent of compliance with laws.

The ISO 14000 technical committee (TC 207) is doing some groundwork to set down norms for compliance. It has suggested life cycle assessments (including the various stages from procurement of raw materials to production, sale and disposal) using traditional environment impact and risk assessment methods for various industries.

A study along these lines is under way in Europe, North America and Asia in several crucial, polluting sectors like paper and pulp, metals, building and construction, electronics and household applications and, of course, power generation. The life cycle assessment procedure lists some 10-15 indicators, that will subsequently be standardised for eco-labelling.

Any firm meeting ISO standards in environmental management will be awarded an ISO 14001 certification. The actual guidelines for implementing environmental management systems (EMS) are listed out in ISO 14004.

Can ISO 14000 really make the world less polluted? As with the ISO 9000, the

answer can be yes or no. That is because, like the quality standard, ISO 14000 is a procedural in approach. Broadly, it requires that every facility must have in place an environmental policy statement declaring its commitment to abide by existing rules and regulations.

The difference could be that an ISO 14000 company is expected to show readiness to improve on existing standards and set up a management system specifically to measure its environmental impact and stay by its policy statement.

The ISO 14000 series stipulates that regular audits are carried out to check compliance with stated norms. As of now, there is a de facto requirement that audits are carried out not internally but by a higher authority -- it could be the government, the consumer, a corporate body or the society at large. In time, this is likely to become enforceable.

But the scope to reform does exist. This is because environment management systems (EMS) are not restricted to the firm but also to those associated in any way with its functioning and processes. For instance, it is stipulated that suppliers and contractors work out their equivalents of EMS to put in place some check on maintaining environmental standards.

Finally, a firm should, on request, be able and willing to supply a certificate stating that it meets ISO 14001 criteria for environmental management.

Indian corporates, poised to step in line with any international standards, is all set to go in for ISO 14001 certification. It has been somewhat of an uphill task, since most Indian corporates have little or no consciousness of environmental costs. The immediate advantage of receiving such a certification is that it improves the image of the company which, in turn, immediately improves its rating on the global trade arena.

Not surprisingly, the major chambers of Indian industry, the Federation in Indian Chambers of Commerce (Ficci), the Confederation of Indian Industry (CII) and the Associated Chambers of Commerce (Assocham) are working at educating companies on the ISO 14000 package.

Case studies are a highlight of their programme for disseminating information on the series. There are profiles of companies that have gone in for environmental management and instances are sited where they reduced waste and cut on effluent discharge. The lesson in the story is a healthier workforce and increased productivity.

CII sources quote the examples of Nalco in Orissa and Indian Aluminium in Nenjengud to illustrate the efficiency introduced with EMS systems. In the very first year, Nalco showed a savings of about Rs 2 crore with an investment of about

Rs 50 lakhs on environmental management systems.

At the Indian Aluminium plant, all workers were provided with complaint sheets which they could put up to the general manager on citing instances of wastage, leaks or spoiling materials.

Harihar Polyfibres, a company that has been a favourite whipping boy of the green brigade, is now working towards reducing resource use by cutting down on waste. After modifying its equipment and effecting some process changes (including a shift from the use of hazardous to non-hazardous substances), it has achieved cumulative savings of Rs 18 crore annually over the last ten years or so.

Management commitment Gather environmental impact data

Develop environmental policy

Evaluate the company's existing environmental management system against ISO 14000

Perform gap analysis of company system against ISO 14001

Develop action plan

Analyse and undertake changes to address the requirements

Perform internal audits against ISO 14001 requirements

Correct deficiencies

Pursue ISO 14001 certification.