(40) Sustainability

 5 things you should know about sustainability

What Is Sustainability and Why Is It Important?

sustainability50

Model appropriate behaviours

 Certainly, HR should model sustainable behaviour by implementing the suggestions in on services and office operations. You should also set the tone for work/life balance. The HR department is also well placed to organise and participate in community projects. Apply environmentally preferable purchasing guidelines when you purchase products and services. When you arrange meetings, use a green caterer who offers locally grown, seasonal produce, buffet-style meals that reduce packaging, and reusable flatware and glasses.

Use your influence and your contacts across the organisation to align actions with words. Encourage your legal staff to print contracts on both sides and to allow electronic signatures. Encourage purchasing to implement environmentally preferable purchasing policies and work with facilities to improve the comfort of and air quality in the building.

Measure the benefits

Learn how all the various parts of the business affect human health, employee satisfaction and productivity. Did you know that green cleaning products can reduce absenteeism related to asthma and another lung- and skin-related sensitivities? Did you know that daylighting and other green building practices can improve productivity? Have you thought about how sustainability can bring meaning to work and help you attract and retain employees? So talk to your facilities manager about the cleaning arrangements and get involved if there is a remodel planned. Work with top management to maximise the benefits of their sustainability initiative so that it inspires both applicants and employees.

You can help make the business case for sustainability by measuring your own improvements and also helping others gather quantitative and qualitative data.

The following list should help you see opportunities:

• Measure productivity before and after a remodel in which green building techniques are used.

• Track absenteeism before and after the cleaning staff switch to green cleaning products. Compute both the labour costs and the avoided medical costs.

• Ask job applicants if they are familiar with your sustainability initiative and see how many say they approached you because of your commitment to it. Track the percentages over time to show top management the trend line.

• Compare your retention rates with similar organisations that have not adopted sustainability. Compute the cost savings by factoring in the cost of advertising for, screening, hiring and training new employees.

Purchasing: How to Determine What to Buy and How to Work with Suppliers

Over the last decade, purchasing has transformed from an administrative function to a strategic one. It’s no longer enough to get the product on time and at the cheapest possible price. Now purchasing has become integral to managing waste, protecting product claims and managing the entire supply chain. Just-in-time manufacturing requires more intimate relationships with a smaller number of suppliers. Customer requirements are driving the need to know what is in the product. Public and shareholder expectations drive buyers to investigate the labour and human rights practices of their vendors. So purchasing today is key to efficiency, competitiveness and image. This chapter explores how these drivers relate to sustainability in more depth.

WHAT YOU SHOULD KNOW ABOUT SUSTAINABILITY

The purchasing corollary to the old adage ‘what goes up must come down’ is ‘what comes in must go out’, meaning either as product or waste. One study of ‘material throughput’ in US manufacturing discovered that only 6 per cent of the inputs ended up in the product!1 We are purchasing huge quantities of stuff that doesn’t get translated into sales. And much of what’s left must be paid for again, in tipping fees or emissions permits. Getting control over your purchasing choices can not only reduce your environmental and social impacts, it can also save you costs relating to material input and output.

Companies increasingly have to substantiate environmental claims about their products. Many governments and companies are issuing environmentally preferable purchasing policies, in some situations publishing grey lists and black lists of chemicals they want to see less of or have phased out entirely. This requires you to know what is in the sub-assemblies, components and additives that go into your product. In 2001, just in time for the holiday season, The Netherlands banned Sony Play stations because the cables contained too much cadmium, causing a media uproar and earning Sony a hefty fine. Through surveys and other methods, purchasing agents must understand what is in the products they buy.

Several years ago, Nike was surprised to discover that the public held them responsible for the labour practices of their suppliers. Nike doesn’t manufacture anything; they use suppliers, mostly in Asia, to manufacture their shoes and clothing. After stories about worker abuses and low wages hit the papers, Nike’s image took a dive. If the public makes no distinction between the practices of a company and those of its major suppliers, then it is prudent to know all you can about the social, ethical and environmental practices of your vendors.

Just-in-time manufacturing has led to sole-sourcing or reducing the number of suppliers. With this comes a level of risk. What happens if your only supplier of a key component has a significant problem – their plant blows up, the department of environmental quality shuts them down or one of their critical raw materials is suddenly classified as a hazardous material? Instantly your entire supply chain can be disrupted. To manage that risk, many purchasing departments require suppliers to have an environmental management system or to be ISO 14000 certified.

The world is so interconnected; one mishap can lead to a host of problems. For example, when a fire destroyed Philip’s semiconductor plant in Albuquerque, New Mexico, the supply of radio frequency chips used in cell phones was cut off to both Nokia and Ericsson. While the fire was caused by lightning, not human error, it demonstrates the importance of having strong supply chain management systems. When the fire prevented Philips from shipping their product, the resulting shortage devastated Ericsson as they did not have supplier redundancy built into their system. Nokia, on the other hand, met its production targets and took market share away from Ericsson, who ended up by missing their production targets and posting a US$1.7 billion loss in their handset division that year.

Determining whether product A is more sustainable than product B can be a daunting task, much more complicated than it would first seem. Yet purchasing departments are now being asked to make these assessments. Often they turn to product certification schemes (Green Seal, Energy Star, Food Alliance, Forest Stewardship Council, etc.), which are audited by a third party. However, this is only a partial solution as there are often competing certification schemes making different claims for the same product. Purchasing must then assess whether certification A is better than certification B!

Some organisations have used purchasing as a way to move an industry toward sustainability. A number of clothing manufacturers, under the umbrella of Business for Social Responsibility, tackle sweatshops and other international labour issues. Nike and Patagonia have joined forces with others to create a reliable market for organic cotton (since a quarter of the world’s insecticides are used on this crop).

As you can see, purchasing is not just paper-pushing any more. So what are the strategies progressive purchasing departments are using to help their organisations become more sustainable?

We’ve organised the most common strategies into two loose categories:

1 purchasing practices – the systems, policies, and procedures that support sustainability; and

2 purchasing projects – typical ad hoc tasks that are undertaken to solve a particular problem.

Purchasing practices

Purchasing practices include those policies, procedures and systems that support or encourage sustainable choices. This section looks at some of the more common best practices.

Adopt sustainable or environmentally preferable purchasing (EPP) policies. Many organisations, especially governmental agencies, are establishing EPP guidelines. Forty-seven US states have some form of buy-recycled policies, and many local and state agencies go far beyond this.3 The city of San Francisco, for example, has just become the

first city in the US to enact a law that requires all city purchases to take public health and

environmental stewardship into consideration. The law affects everything from toilet paper to computers and covers the $600 million per year the city spends on products. These policies send important market signals, rewarding those with more sustainable products and services while hanging a carrot out for those who don’t. As the name implies, most EPP policies focus only on environmental attributes (often including human health), leaving out the socio-economic elements that are equally important to sustainability; but at least they are a start. You can incorporate socio-economic elements into a sustainable purchasing policy by adding other criteria such as labour practices, diversity and community contributions.

Depending on the culture of the organisation, these EPP programmes may take the form of formal policies and guidelines or simply accepted the practice. Don’t reinvent the wheel; many of them are available on the internet, so borrow freely.

You can also use eco-labels as a proxy for doing all your own investigation.  Note that choosing to use these certifications may disadvantage small businesses, so you may want to provide a way to offset this.

Resources:

The Center for a New American Dream’s website includes a host of examples, www.newdream.org.

The US Environmental Protection Agency has created environmentally preferable guidelines for computers; go to www.epa.gov/oppt/epp/electronics.htm.

The Forum for the Future in the UK makes available for free download the booklet ‘Buying a Better World’ and also the Sustainable Procurement Toolkit, Embed EPP or sustainable choices into online systems

In a decentralised purchasing environment, one of the most effective ways to encourage people to choose EPP products is to make them easiest to find and procure. When someone searches for notepads, for example, the ones made from recycled content should show up first. Make chlorine-free copy paper pop up first on your online purchasing system. If an employee needs a less sustainable product, make them dig for it.

TriMet, the transit authority for the Portland, Oregon metropolitan region, worked with Office Depot to further develop internal green purchases. They examined their top 20 purchases (this included file folders, paper, post-it pads, pens, pencils, pads, etc.) and then worked with both Office Depot and Boise Cascade to identify recycled options to make them the first items employees see when they go online to make purchases. As environmental engineer Kevin Considine explains, ‘Their product lines are limited to what I would call more conventional choices – no options for 100 per cent post-consumer chlorine-free kenaf paper or anything like that.’ He acknowledges that the greener options have cost them more at times, but says that these prices are coming down because of the increasing green market they are helping to create. ‘It was relatively easy [to set this up] and more options are being added to their product line each year that meets performance needs and is at least a greener option.’

Embed sustainability language into RFPs and contracts

Sustainability brings together strange bedfellows at times. We once had someone approach us to bid with them on a wastewater treatment job. We admitted to knowing nothing about wastewater treatment. No matter; they wanted us on the team anyway because we understood sustainability and the request for proposal (RFP) made mention of it. In the process of writing the proposal, we were able to impart a lot about sustainability.

(Mercifully, we didn’t get the job.)

Never underestimate the power of including mention of sustainability or related terms in an RFP. It definitely gets attention and it helps to pre-empt the nay-sayers who claim that

customers aren’t asking for sustainability. You don’t even need to rate it particularly highly on your evaluation criteria. But doing so will stimulate creative thinking and innovative proposals. Similarly, write sustainability language into your contracts. Cleaning contractors can be asked to use Green Seal or equivalent products. Require your landscaping firm to use integrated pest management with synthetic pesticides used only as a last resort. Building contractors can be expected to recycle or reuse 90 per cent or more of construction debris. Professional service firms can publish reports on chlorine-free, 30+ per cent post-consumer recycled paper and bind reports without plastic covers or vinyl binders. Arm-twist your lawyers into printing contracts double-sided. Maybe use existing eco-labels, third-party certification schemes and standards as additional criteria.

Writing contract language is another place where you’ll want to leverage what others have done. Use the resources below to fast-forward your process. Also, check out the appropriate third-party certification programmes.

Resources:

EPA’s environmentally preferable purchasing contracts database, www.epa.gov/oppt/epp/database.htm

Government websites, especially King County, Washington and Santa Monica, California;

Massachusetts and Minnesota.

The Unified Green Cleaning Alliance website has standards for sustainable cleaning products, www.ugca.org

Use service contracts to align the interests of your vendors with your own Sometimes the solution is to change the incentives in a contract so that the vendor’s interests are aligned with yours. Often this takes the form of service contracts that convert products into services. Instead of buying paint, you purchase the service of painting widgets. Now the vendor doesn’t want to sell you the maximum amount of this toxic product but instead benefits from reducing the product’s use and reducing its toxicity.

These service contracts are used most commonly for chemicals and resource management issues. For example, Portland State University’s waste hauler used to be paid for each tonne of garbage that was hauled away, creating a negative incentive for recycling. The more that was recycled, the less waste they could haul away and get paid for. As a result, the hauler did not have any reason to help Portland State reduce waste or increase recycling. So the university set out to craft new contract language whereby both parties shared in the benefits of increasing the recycling rate by compensating the hauler for helping to reduce waste and process recyclables. ‘It’s great,’ says Michele Crim, their sustainability coordinator, ‘Now they are setting up site visits for our recycling coordinators to show them an effective collection process from beginning to end.’

Implement a supply chain environmental management system Supply chains have become increasingly critical to business, requiring collaboration across organisations. Outsourcing, just-in-time manufacturing and cradle-to-grave legal risks all imply that you must manage beyond the walls of your own operation.

The most common approaches to greening the supply chain are summarised in the table below:

Ben Packard, director of environmental affairs at Starbucks, emphasises: It’s a mistake to isolate ‘greening the supply chain’ as something completely different. It should be presented and received as one of many customer expectations (in addition to price, performance, quality, etc.). If you treat it as a new and separate conversation, it may look more difficult than it needs to be. Given the natural tendency to resist change, there is no need to make this any larger than it needs to be as long as you are able to get the performance improvements you are after. To figure out which of these options you should pursue at any one time requires some upfront planning. That’s where a supply chain environmental management (SCEM) system can be helpful. As with any management system, you need a way to set policy and priorities, plan, monitor the implementation and review the results.

Resources:

Hitchcock, Darcy (2001) Greening the Supply Chain. One of the booklets in the Sustainability Series.

National Environmental Education and Training Foundation (2001) Going Green …

Upstream: The Promise of Supplier Environmental Management. Washington, DC: The National Environmental Education and Training Foundation.

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