GEMI Gemstones Environmental Management Systems

1. GEMI GemstonesEnvironmental Management Systems GEMI Conference March 2003 Carl Wirdak Occidental Petroleum Corporation

2. EMSs - What are they? • This survey addresses the use of environmental management systems (EMSs) in organizations. • Can range from the formal ISO 14000 approach to one that is based on organization-specific procedures and practices. • For the purpose of this survey, either end of the EMS spectrum is considered valid. GEMI Gemstones – March 2003

3. Survey Overview • 175 registrants attending • 47 surveys completed • 27% response rate • Thank you to all participants! GEMI Gemstones – March 2003

4. Do companies have an EMS? • 33 of 40 companies have an EMS • No EMSs in use by • Academics • Agencies • Consultants • but this is a very limited sample GEMI Gemstones – March 2003

5. How mature are the EMSs? • Most EMSs are still toddlers • There are a few teenagers out there # of EMSs GEMI Gemstones – March 2003

6. EMS Drivers Business needs drive adoption and implementation of EMSs GEMI Gemstones – March 2003

7. What are the “other” drivers? • Believe in the importance / usefulness of an EMSs to drive continuous improvement • To obtain performance improvement • Desire functional integration and performance focus • Competitors actions • Company President's initiative • Relationships with local regulators & public opinion • Socially responsible investment community • It was the right thing to do GEMI Gemstones – March 2003

8. Environmental policy Training, awareness and competence Documentation and records Operational control Emergency preparedness and response Non-conformance corrective and preventive action EMS Elements 100% >90% Environmental aspects Legal and other requirements Objectives and targets Environmental mgmnt program(s) Communication Monitoring & measurement Audit / assessment Management review >80% 30% Cost tracking GEMI Gemstones – March 2003

9. EMS Verification • All companies verify their EMS • Systems 6 years and older favor internal verification by 3:1 margin • Systems < 5 years favor internal verification by 4:3 margin GEMI Gemstones – March 2003

10. Verification Frequency • Every company verifies its EMS at least every 3 years • Companies that use external verifiers are biased to more frequent reviews GEMI Gemstones – March 2003

11. ISO 14000 Certification • 58% certified • Majority of systems have been in place more than 5 years • 60% (11 companies) use external verifiers • 42% not certified • 10 of 14 have been in place < 5 years • 7% (1 company) uses external verifiers GEMI Gemstones – March 2003

12. Does EMS help in decision-making? • If EMS is ISO certified, average is 3.5 • Absent ISO certification, the average is 2.2 • If EMS in place > 5 years, average is 3.6 • If < 5 years, average is 1.9 GEMI Gemstones – March 2003

13. Other EMS Benefits • What’s in it for companies that institute an EMS? • Helps improve compliance and environmental performance and reduce risks • Enhances relationships with variety of external constituents GEMI Gemstones – March 2003

14. Number of Companies Yes 2 21 Goals 0 8 No No Yes Targets Goals and Targets • Companies link EMS goals with overall business goals • Typically, annual targets and action plans are established if a company has an EMS • Only 50% of firms link performance vs. goals to compensation GEMI Gemstones – March 2003

15. Monitoring & tracking performance • 94% track environmental performance • 82% track progress against EMS goals • 85% compare performance across facilities Roll-up of EMS information GEMI Gemstones – March 2003

16. Communication of EMS information Internal Communication External Communication GEMI Gemstones – March 2003

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