|Q & A|
ISO 14000 is an international standard for environmental quality. What exactly is this standard, and what does it mean to your business?
In September 1996, the International Organization for Standardization (ISO) finalized its ISO-14000 environmental quality standards. Much anticipation has surrounded the development of these standards, which are designed to help companies achieve superior environmental performance through the development of integrated and comprehensive environmental management systems (EMS). Corporate managers all across the industrial community are currently evaluating the benefits, costs, and potential long-term implications of ISO-14000 compliance. This debate must be taken up by the converting industry as well, given the potential importance of ISO-14000 to continued business operations in the international marketplace and to meeting the environmental compliance challenges at home.
What is ISO-14000?
ISO-14000 is a voluntary standard in the areas of environmental management, auditing, performance evaluation, labeling, and life-cycle analysis developed by the International Organization for Standardization, a worldwide federation founded to promote the development of international manufacturing, trade, and communication standards. The goal of ISO 14000 is to promote better corporate environmental stewardship through the creation of a series of internationally accepted standards for companies to use in managing the environmental aspects of their operations. This goal is accomplished through the development of environmental management systems (EMS), which are subject to certification by third-party registrars or by the individual companies themselves through a self-certification process.
Although ISO 14000 specifies the EMS requirements and provides a framework, it does not provide a fully designed EMS. That is left to each company. The ISO 14000 standard does specify in significant detail the required components of any acceptable EMS system. The specifics of a company's EMS will depend, in part, upon whether or not it is pursuing third-party certification by a registrar. A company that chooses to pursue third-party certification may have less flexibility in establishing its EMS than a company that opts for self-certification. In most cases, the market should dictate whether third-party certification is necessary. Currently, some companies are choosing to establish their EMSs while delaying the decision to obtain third-party certification until the market necessitates it.
Making a Statement
The starting point for the development of an ISO 14000 EMS is the adoption of a corporate environmental policy statement. The environmental policy should be appropriate to the nature and scale of the company's activities and should include a commitment to pollution prevention and regulatory compliance. It should be issued by management and be liberally communicated to all employees. Under ISO 14000, this policy should also be made available to the public.
The next step is to establish and maintain a procedure to identify:
(1) the environmental aspects of the company's activities, products, or services;
(2) the legal requirements that govern the company's activities; and
(3) the environmental objectives and targets of the company, which should take into account both the environmental aspects and legal requirements pertaining to its operations.
The company then should establish and maintain a program that assigns responsibility and sets a time frame for achieving its objectives and targets.
Once the preparation stage is complete, the EMS is ready for implementation. At the heart of an ISO 14000 EMS is the requirement to conduct regular audits of a company's operations. These audits must be comprehensive and carefully tailored to ensure that any non-compliant activities are identified and addressed. A company also must make a commitment under the EMS to promptly correct any deficiencies identified during these audits.
Although ISO 14000 establishes the specific components of the EMS, the ISO 14000 standard is intended to be flexible enough to apply to all types and sizes of organizations.
Additionally, it is important to note that the ISO 14000 standard does not establish or require that any specific environmental performance standards be met in order to obtain ISO certification. Instead, the focus is on whether the proper "systems" are in place to ensure that a company maintains its compliance with its regulatory obligations.
Is ISO-14000 Right for You?
Many companies are taking a "wait and see" approach to ISO 14000 certification. For companies with developed, comprehensive internal environmental compliance programs, ISO 14000 certification may require minimal fine-tuning. For these companies, the question is whether the costs of certification can be justified by real benefits.
For other companies, the development of an EMS under ISO 14000 represents a dramatic change from existing operations and may, in fact, subject a company to a level of self-evaluation that it is ill-prepared to engage in.
One of the primary motivations for becoming ISO 14000 certified is the perception that compliance with this standard will become a requirement for doing business in the global marketplace in much the same way that the ISO 9001 porocess quality standards have worked.
In the European markets, for instance, the incentive for ISO 14000 certification is much more market-based because of the high consumer demand for an environmental conscious businesses. In fact, a recent study indicates that the third most important reason (after quality and cost) that a product is purchased in the European Union is that the producing company is considered "green." Thus, companies that produce and sell their products in the EU have strong market pressures to pursue ISO 14000 certification.
Companies operating in the US may have somewhat different concerns and motivations in evaluating ISO 14000 compliance. Many US companies with solely domestic operations are reluctant to invest additional time and money toward a voluntary program that is not directly focused on emission or effluent reductions. Companies that are already in compliance because of stringent enforcement in the US may well ask what additional benefits are to be gained by pursuing ISO 14000 compliance.
On the other hand, those companies that are having difficulties with compliance are most likely too busy "putting out fires" to give ISO 14000 compliance the energy and resources needed for implementation.
Thus, because of the immediate focus on compliance issues and the absence of strong domestic market pressures, the implementation of ISO 14000 in the US is lagging behind the overseas markets.
Are the Benefits Worth the Costs?
Ultimately, the decision to pursue ISO 14000 compliance requires an examination of the costs and anticipated benefits of the process. If, and only if, a company is prepared to subject its operations to the rigorous self-evaluation that will be required, the establishment of an EMS can have very tangible benefits for companies over and above the potential market demands.
While EMS certification has been estimated to cost somewhere in the $100,000 range for most companies, the diligent performance and adherence to an EMS has proven to be cost-effective. One of the benefits of ISO 14000 compliance is the top-down examination of a company's operations that targets specific areas for improvement, which can result in increased efficiency, pollution prevention, and the utilization of less resources. This, in turn, results in direct savings in the cost of doing business.
For example, one company has reported that although it spent over $100,000 on its EMS, its environmental administrative costs were reduced by nearly 50%, resulting in the recovery of its EMS investment in less than one year.
This Article was Provided by a Driso Consultant.
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