Department of Environment and Climate Change NSW ROD CLARE Business Partnerships 11 November 2008

1. Department ofEnvironment and Climate Change NSWROD CLAREBusiness Partnerships11 November 2008

2. TAKING A FRESH LOOK

3. Overview • Who is the DECC? • Working towards sustainable business • Sustainability Advantage • Getting involved

4. Business Partnerships • Energy Saver Funding Department ofEnvironment and Climate Change NSW • NSW environmental regulator • Lead agency on climate change adaptation • Sustainable business support

5. What is the problem? • Unsustainable use of resources • Climate Change • Air pollution • Disappearing forests, fisheries, cropping lands and plant and animal species. • Danger of ecological collapse

6. What is the RISK of not taking action? • Physical • Reputation • Commercial • Most energy contract prices will rise 35% – 40% from June 09 (+ CPI and network charges) • Waste Disposal Costs up 25% By 2010-11 • Water costs expected to rise by approx 50% by 2011-2012 (Subject to IPART) • Regulatory • Supply Chain “ … I am no scientist. But I do know how to assess a risk – and this one is clear. Climate change poses clear, catastrophic threats. We may not agree on the extent, but we can’t afford the risk of inaction” Rupert Murdoch 11 May 2007

7. What are the opportunities from action? • Leadership • Direct business benefits • Reduce compliance costs • Cost savings through operational efficiency – energy, water and waste • Improve reputation and “intangible” value • Engaged stakeholders • Retain / motivate staff (satisfaction, productivity) • Community licence to operate 86% of people would think more highly of their employer if they were addressing the climate change issue [STW Group: Climate change and its implications for business and brands 2007]

8. Economic Environmental Social What is sustainability?“Meeting the needs of the present without compromising the ability of future generations to meet their own needs.”Brundtland Report, 1987 Remember! “ The future is not somewhere we are going…..It is somewhere we are creating.” Professor Ian Lowe

9. What does it mean to be a sustainable organisation? • Stakeholder driven – recognise the need to make trade-offs (between shareholders and stakeholders) • Transparentandaccountable- internally and externally • Trustworthy – perception impacts reputation • Integrated - social and environment is just part of day to day activity • Risk aware – continually review risk and opportunity • Data aware– integrated tracking and reporting • Communicate- engage proactively internally and externally • Treads lightly– reduce to minimum environmental and social impacts • Account for costs – account for environmental cost on balance sheet … to “create value”

10. Eco-Efficiency Strategic Sustainability Visionary Sustainability Road Map Most companies Leaders Not for all Reactive Competitive Advantage Objective >> Regulatory compliance Resource management Leadership - Set the agenda Open Culture >> Closed Activities >> • Compliance focus to avoid liabilities • Ad hoc eco- efficiency projects • Environmental risk the responsibility of the operations manager only • No engagement with staff and external stakeholders • Systematic approach to eco-efficiency projects (EMS) • Technological best practice • Benchmarking & continuous improvement • Staff training • Public corporate commitment to sustainability • Sustainability fully integrated into policies & plans • Employee participation • Operational & personal Sustainability KPIs • Product stewardship • Sustainability vision determines corporate structure & strategy • Sustainable products & services • New markets • Promote Sustainability Where does your company sit?

12. Government & Business interface Environmental Responsibility/Risk Resource Efficiency Environmental Action – Traditional Approach Does this sound like your business? We want to improve….but where do we start? • Prioritise, ‘pull together’ and add value • Holistic rather than ad hoc We’ve had some resource efficiency successes..... what next?

13. Visioning Resource Efficiency Environmental Responsibility Staff Engagement The Process Diagnostic Commitment Cluster network Modules Tailored support + + choice of Commitment and Planning Supply Chain 12 to 18 months Climate Change Stakeholder Engagement Continuous improvement and evaluation

14. Management Diagnostic ACHIEVEMENT Achievement in the past 12 months MEASUREMENT & VERIFICATION INNOVATION & NEW TECHNOLOGY Metering & Monitoring Reporting, feedback and control systems Innovation & new technology FINANCIAL MANAGEMENT OPERATIONS &MAINTENANCE SUPPLY CHAIN MANAGEMENT Operating procedures Maintenance procedures Raw Materials and Equipment Product Stewardship Operating and Capital Budgets PEOPLE / STAKEHOLDERS LEADERSHIP UNDERSTANDING PLANS Understanding of performance and opportunities Demonstrated corporate commitment Targets, performance indicators (KPI) and motivation Plans Accountabilities Awareness and training Employee Management Stakeholder Engagement

15. = Best Practice and Continuous Improvement = Management of Environmental Sustainability integrated into Business Systems = Formal Systems for Managing Environmental Sustainability = Informal Eco-efficiency Practiced = Identified the Need to Improve (Default rating) Diagnostic One-2-Five® Rating

16. Diagnostic Results – report card

17. Your Recommended Actions Module Responsibility Date 2.1 Understanding environmental impact s and obligations ·Put a system in place to ensure you comply with your environmental obligations Risk Mgnt. & Envt. Responsibility 4.1 Targets, performance indicators (KPIs) and motivation ·Set overall cost (and/or volume) reduction targets that specifically incorporate eco-efficiency savings. Vision Com.& Planning 2.3 Understanding of energy performance and opportunities ·Perform a detailed assessment of energy savings in each of your energy intensive processes and operations. Resource Efficiency 5.2 Awareness and training ·Conduct training in components of Environmental Sustainability and the associated environmental implications for relevant staff. Staff Engagement 3.1 Supply chain management - Procurement ·Develop supplier selection guidelines Supply Chain Action Plan

18. Modules

19. Resource Efficiency Walkthrough audit Staff briefing & set up Efficiency Teams Brainstorming sessions & REAP Action Plans Efficiency teams meetings Prioritise opportunities Assign roles Set performance monitoring Continuous improvement Implementation What happens in a Module?

20. Climate Change Awareness workshop Develop GHG inventory Quality check Specific workshops Minimising GHG footprint Managing climate risk Opportunities Strategy & action plan Implementation What happens in a Module?

21. Clusters in Action –200 companies • Newcastle Council (Marquis, Newcastle Airport, Fairfax Regional Printers) • Food manufacturers (Goodman Fielder, Coca Cola, Kelloggs) • Poultry (Bartter, Inghams, Red Lea, Biaida) • Building products (Laminex Group, Ontera Carpets, Austral Bricks, Vinidex, CSR Gyprock, James Hardie) • Healthcare (Ramsey, Carrington Centennial) • Illawarra Resource Recovery – Bluescope Steel • Riverina(Cassella Wines, McWilliams Wines, Orlando Wines, De Bortoli Wines, National Foods, Polkinghorne & Longhurst (surveyors),Murrumbidgee Irrigation) • TAFE & universities (7 TAFE Institutes & 2 unis)

22. Resource Efficiency Opportunities Riverina Cluster (18 months) - 12 wineries and agribusiness Casella, Debortoli, McWilliams, Orlando, Westend, Bartter, Rockdale Beef, National Foods, Murrumbidgee Irrigation, Real Juice, Chicken Income Fund, PHL Surveyors • Electricity 1,600 MWh • Gas 9,600 GJs • Kilometres 100,000 + (truck movements) • Waste 150 tonnes • Water 150 ML p/a • Vegetation 27,000 trees Saving - $2.36 million pa in 07/08 (payback < 2 years) Expected to double in 08/09

23. “It is the most well conceived continuous improvement system I have seen. It balances systems with resources and strategic intervention to provide momentum and understanding to environmental programs. • This concept should enable all areas of industry at any level of environmental management, to make real environmental progress.” • James Kelly, Innovations Manager, Rockdale Beef, January 2008

24. Benefits of the program “The Sustainability Advantage Program has supported and helped establish the integration of the environmental aspects of McWilliams Wines’ business planning processes”. (McWilliams Wines) “Facilitation, networking and feedback from fellow cluster members has been a very positive experience for Orlando Wines. Efficiency gains can translate across many different industries.” (Orlando Wines) “We found the Climate Change module very informative and we now have a better understanding of our place in a carbon emissions environment as well as our risks and opportunities as a company. “ (Koppers Australia) “Our business model is underpinned by long-term sustainable systems, providing long-term customers with sustainable high quality beef products”. (Rockdale Beef)

25. Invitation to participate • Joining fee – up to $3,000 ( more than 100 employees) • To find out more please contact: • ROD CLARE • rod.clare@environment.nsw.gov.au • Tel: 8837 6004