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Presentation Pack. Corporate responsibility and business success in China. Structure. Sustainable development Facts about China Sustainable development in China Business role and responsibilities Business implementation.

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Presentation pack l.jpg
Presentation Pack

Corporate responsibility and business success in China


Structure l.jpg
Structure

Sustainable development

Facts about China

Sustainable development in China

Business role and responsibilities

Business implementation


Getting started l.jpg

“Sustainable development meets the needs of the present without compromising the ability of future generations to meet their needs”

Brundtland Commission, “Our common future”, 1987

Getting started

  • Who has previously heard about sustainability? In what context?

  • What would be your definition of sustainable development?

  • How important is sustainable development:

    • To you?

    • To your company?

def·i·ni·tion

"de-f&-'ni-sh&n

Q


Human activity impacts l.jpg
Human activity = impacts without compromising the ability of future generations to meet their needs

Global Warming

Ozone

Depletion

Water, Air, &

Land Pollution

Reduction

of Biodiversity

Resource

Depletion

Population

Increase &

Economic Growth


Sustainable development covers many topics l.jpg
Sustainable development covers many topics without compromising the ability of future generations to meet their needs

  • Demography

  • Wealth

  • Nutrition

  • Health

  • Education

  • Consumption

  • Energy

  • Pollution

  • Emissions and waste generation

  • Efficiency

  • Ecosystems

  • Climate change

  • Agriculture

  • Human rights

  • Water

  • Urbanization

  • Mobility

  • Communications

  • Labor

  • Democracy

  • Accountability

  • Privatization

  • Biodiversity


A changing global landscape l.jpg
A changing global landscape without compromising the ability of future generations to meet their needs

“In a world of instant communications, whistle blowers, inquisitive media, and googling, citizens and communities routinely put firms under the microscope.” Tapscott and Ticoll (2003)

  • Issues include:

  • Communications – CNN world

  • Changing expecations of consumers

  • Valuation – including intangibles and knowledge

  • Free movement of goods and services

  • Finite nature of resources – carrying capacity

  • Changing demographics – haves and have nots

  • Changing role of business and government


Context demography l.jpg
Context: Demography without compromising the ability of future generations to meet their needs

  • Today: 6 billion human beings on Earth

  • 2030: population will reach 8 billion, of which 7 billion will live in the developing world

  • Populations will increasingly move towards cities, creating megalopolises


Context natural resource needs l.jpg
Context: Natural resource needs without compromising the ability of future generations to meet their needs

Poverty eradication & population growth lead to a rising demand for materials and natural resources

OIL, GAS, URANIUM, MINERALS, CLEAN, WATER … are finite and limited resources, and could become rare in the near future


Land pollution l.jpg
Land pollution without compromising the ability of future generations to meet their needs

  • Land Pollution:

  • Agriculture +industrial activities + waste generation

  • Intensive use of chemical fertilizers

  • Intensive land exploitation

x 4.5 in 40 years


Air pollution l.jpg
Air pollution without compromising the ability of future generations to meet their needs

  • - Main environmental threat to human health

  • - SO2and NO2emissionsAcid rain


The greenhouse effect l.jpg
The Greenhouse Effect without compromising the ability of future generations to meet their needs


Biodiversity l.jpg
Biodiversity without compromising the ability of future generations to meet their needs

  • Global biological diversity is decreasing, due to direct and indirect human activity: hunting, loss of natural habitat (deforestation, desertification), etc.

  • The continuous decrease in animal and plant populations results in a loss of genetic diversity


Roles and responsibilities l.jpg
Roles and responsibilities without compromising the ability of future generations to meet their needs

Globalization goes together with the emergence of a growing

number of stakeholders (more demanding and powerful)

PRESERVE PEACE & STABILITY

SEEK GLOBAL LONG-TERM SOLUTIONS

POWER TO RULE, INCITE, TAX

Institutions

DEMAND MORE TRANSPARENCY, INFORMATION AND ETHICS; INCLUDE SOCIAL & ENVIRONMENTAL PERFORMANCE IN BUSINESS NOTATION

POWER TO PROVIDE FUNDS

Investors

DEMAND TO BE CONSULTED AND ASSOCIATED

POWER TO INFORM AND DENOUNCE

(MEDIA, INTERNET, JUSTICE, …)

NGOs

Individuals

SEEK QUALITY OF LIFE AND SECURITY

DEMAND FREE CHOICE

POWER TO VOTE, DENOUNCE, BOYCOTT

Businesses

CONTRIBUTE SERVICES, PRODUCTS AND TECHNOLOGY TO SOCIETY

BALANCE ECONOMIC PROFITS WITH THE LONG_-ERM SUSTAINABILITY OF THE BUSINESS


Increased awareness l.jpg
Increased awareness without compromising the ability of future generations to meet their needs

VALDEZ

1948: Declaration of human rights

1961: WWF, amnesty international

1970s: Environmental movements

1980s: 1984: Bhopal; 1986: Chernobyl; 1989: Exxon Valdez…

2002: Enron, WorldCom…


Global frameworks and initiatives l.jpg
Global frameworks and initiatives without compromising the ability of future generations to meet their needs

SarbOx

The search for solutions is happening on a global scale and is being led by both public institutions and as part of private initiatives. Solutions include new legislation, stakeholder partnerships, voluntary agreements, codes of conduct, multilateral agreements, interdependent actions, etc.


Key for success in sustainable development l.jpg

Planet without compromising the ability of future generations to meet their needs

People

Profit

Key for success in sustainable development

  • Maintain the balance between economic growth, environment, and social aspects by:

    • An integrated approach for business operations;

    • Partnerships among stakeholders;

    • A Cross-disciplinary approach.

Natural resources & energy

Health & Safety, equity

Economic growth


Structure17 l.jpg
Structure without compromising the ability of future generations to meet their needs

Sustainable development

Facts about China

Sustainable development in China

Business role and responsibilities

Business implementation


Facts about china l.jpg
Facts about China without compromising the ability of future generations to meet their needs

Population growth

Population growth (%)

Population (Mill.)

Population

  • China's population is 1.31 billion people.

  • GDP is US$ 1.41 trillion and expected to grow 8% in 2004.

  • It already accounts for 13% of world output.

  • Largest recipient of foreign direct investment.

  • China produces 2/3 of all photocopiers, microwave ovens, DVD players and shoes, over 1/2 of all digital cameras and around 2/5 personal computers.

  • In the last two decades, almost 200 million people have been lifted out of poverty.

  • Every year, 10 million more people join the job market.

* Ref: The Economist, UNDP and UNFPA


Size matters l.jpg
Size matters without compromising the ability of future generations to meet their needs

  • 60% of the population still lives in the countryside but….

  • At present there is only one car for every 70 people in China, against one car for every two Americans, but….

  • The Chinese government estimates that there are 500,000 HIV positive individuals in China, or a prevalence rate of less than 0.2% but….

* Ref: The Economist, UNDP and UNFPA


Increasing energy needs coal l.jpg
Increasing energy needs: Coal without compromising the ability of future generations to meet their needs

Lack of jobs in western China

74% of electricity produced in coal plants

Coal reserves mainly in western China

Shortage of electricity production capacity

Strain on rail transport

Safety of workers in mines

New coal plants built in urgency

Energy shortage prevents shutdown / modernization of old coal plants

Limited implementation of standards: Pollution, safety & health & health issues

Health and Safety conditions

Efficiency

Pollution

Strain on resources

CO2 emissions, global warming

Coal prices on the rise


Increasing energy needs oil l.jpg
Increasing energy needs: Oil without compromising the ability of future generations to meet their needs

China is the second largest consumer of oil after the USA, and accounts for two-fifths of the increase in global consumption since 2000.

China occupies the second place among the major greenhouse gas emitters worldwide (13.5%).

China only has 1.7% of worldwide oil reserves.

Expected % of needs to be imported:

50% in 2010; 85% in 2030.


Mobility l.jpg
Mobility without compromising the ability of future generations to meet their needs

China is expected to become the world's third largest automaker by 2010.

  • Oil consumption for mobility has risen sharply, contributing to making China dependant on importing oil.

  • Air pollution in the big cities is on the rise.


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Electricity production capacity without compromising the ability of future generations to meet their needs

Current issues

  • Electricity demand increased 16.5% in 2003

  • Shortage of production capacity in 2003

    • At its peak : 40 GW

    • Average : 15 GW

  • Direct impact on the economy, as 70% of electricity is consumed by industry

  • 2005 forecast: to meet its 2020 economic objectives, China must build the equivalent of one nuclear plant every 15 days for the next 15 years.


Energy efficiency l.jpg
Energy efficiency without compromising the ability of future generations to meet their needs

Less than 10% of new buildings are made according to existing isolation standards

Energy growth is increasing faster than GDP (=

“power elasticity co-efficient”)

  • 2005-2020 Government objectives :

  • - Increase GDP four-fold

  • Increase electricity production capacity two-fold (Objective to improve energy efficiency by 25%)

Power elasticity co-efficient should be less than 1.0 (opposite to current trend)

* Ref: UNIDO


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Depletion of natural resources without compromising the ability of future generations to meet their needs

Land degradation and desertification

  • The use of chemical fertilizers in China is two times higher than in other countries

  • Continuous expansion of desert = “desertification”

    • 1950s – 1970s: 1,500 km2/yr

    • 2003: 3,000 km2/yr

  • Sandstorms from the Gobi desert hit Northern China every year, reaching into Korea and Japan, and sometimes even crossing the Pacific Ocean and arriving at west American shores

  • * Ref: UNIDO


  • Depletion of natural resources26 l.jpg
    Depletion of natural resources without compromising the ability of future generations to meet their needs

    • Water pollution and consumption

    • Water availability in China is between 4 and 5 times less than world average

    • Presently 70% of cities have water shortages

    • Availability Irrigation, that accounts for 60% of use of water, suffers from leakages and losses of great magnitude

    • Pollution 60% of rivers and 90% of urban underground water are highly polluted

    • Inefficiency Industrial output needs on average about 7 times more water than more sustainable economies

    • Requirements 30 bln US$ required to solve urban water management in all cities (> 600.000)

    • * Ref: UNIDO


    Depletion of natural resources27 l.jpg
    Depletion of natural resources without compromising the ability of future generations to meet their needs

    Mineral deposits

    China is already the world’s largest consumer of many commodities, such as steel, copper, coal and cement. Its increased needs account for much of the 50% rise in the world’s commodity prices over the past three years.

    • Coal

    • Largest producer and consumer in the world, and…

    • Consumption expected to rise further from 1.2 billion metric tons (2000) to 2.2 billion (2030)

    • US$ 120 billion would be required to modernize mines & install clean combustion systems (IEA)

    Reserves = 334.5 billion metric tons (“only” 3rd in the world)


    Pollution of natural resources air pollution l.jpg
    Pollution of natural resources: air pollution without compromising the ability of future generations to meet their needs

    • Caused by high SO2 emissions from coal combustion China focus acid rain as a serious problem

    • A growing volume of traffic results in growing NOx emissions

    • China is responsible for 36% of worldwide pollutant emissions

    • Respiratory and heart diseases related to air pollution are the leading cause of death in China

    Out of the 20 most polluted cities in the world, 16 are in China.Estimated annual health costs due to air pollution is 44 bln RMB

    * Ref: The Economist, + UNIDO


    Urbanization and poverty l.jpg
    Urbanization and poverty without compromising the ability of future generations to meet their needs

    • Rural poverty: - while 60% of the population lives in rural areas, they contribute to only 16% of GDP- income ratio urban-rural estimated at 3 to 1

    • Urbanization: rate of migrant workers approx. 8 million people each year

    • Cities are facing problems in delivering infrastructure and services

    • Slums may start to appear in cities

    • Increased urban unemployment and loss of social security tied to state-owned enterprise reform

    • These trends are causing a growing “urban poor class”.


    Structure30 l.jpg
    Structure without compromising the ability of future generations to meet their needs

    Sustainable development

    Facts about China

    Sustainable development in China

    Business role and responsibilities

    Business implementation


    Slide31 l.jpg

    China launches "green storm" against forest destruction without compromising the ability of future generations to meet their needs

    China wrestles with 'massive' environmental degradation

    Vancover sun

    05.04.2005

    Xinhua News Agency

    31.03.2005

    Overwork in China claims another life and a foreign MNC is to blame

    Ethical Corporation | 19.11.2004

    China seizes the nuclear option

    South China Morning Post | 04.03.2005

    Recent headlines


    Current sd issues in china l.jpg

    • Depletion of natural resources

      • Land degradation / desertification

      • Environmental pollution (e.g. water, air)

      • Water supply & treatment

    • Regional distinctions in infrastructure

      • Urbanization

      • Energy generation & utilization

      • Waste: solid, liquid, hazardous

    Current SD issues in China

    Population growth and change in social demands

    Which sustainable development issues could result from the tension between these 3 conditions ?

    Limited natural resources

    Fast economic growth

    Q


    Striking a balance l.jpg
    Striking a balance without compromising the ability of future generations to meet their needs

    Good

    lasting SD practice

    Ecological

    Economic

    Growth

    Equity

    Imbalance

    Balance

    • How to:

      • Provide employment opportunities

      • Maintain economic growth

      • Remain a competitive business environment

      • Reduce income inequalities

    • Yet also…

      • Sustaining the environment

      • Improving social aspects

    • Main Drivers:

      • Population Size & Growth

      • Globalization

      • Cultural shifts


    Call to action l.jpg
    Call to action…. without compromising the ability of future generations to meet their needs

    Same issues apply to all countries;

    their significance in China is the rate and magnitude at which they create imbalances

    Resources and efforts from all stakeholders

    are required to correct the imbalances;

    Failing to act immediately

    only worsens the severity of the required solutions

    Implementation is everyone’s responsibility

    = NGO’s, business and government


    Legislation l.jpg
    Legislation without compromising the ability of future generations to meet their needs

    Central government recognizes the need for action.

    Programs initiated to counter China’s SD challenges:

    • Agenda 21

    • Millennium Development Goals

    • Xiaokang (1980) & Tenth Five-Year Plan (2001)


    Government l.jpg
    Government without compromising the ability of future generations to meet their needs

    Key Government Organizations with EHS Responsibilities

    Key: (chart showing approximation of hierarchy)

    NPC: National People’s Congress

    SEPA: State Environmental Protection Administration

    MII: Ministry of Information Industry

    AQSIQ: Administration for Quality Supervision, Inspection and Quarantine

    MOFCOM: Ministry of Commerce

    SAC: Standardization Administration of China (within AQSIQ)

    SDRC: State Development Reform Commission ( or NDRC)


    National people s congress l.jpg
    National People’s Congress without compromising the ability of future generations to meet their needs

    • China’s Clean Production Promotion Law (CPPL)

      • Enacted June 29, 2002, effective January 1, 2003

      • Statute providing legislative authority for a wide range of materials restriction and related initiatives in China

      • “Clean production” defined in law to include “fundamental reduction of pollution from sources, enhancement of resource utilization, reduction in or prevention of pollution during production and in the use of services and products through continual design improvements, use of cleaner energy resources and raw materials, adoption of advanced technologies, and improvement in management to reduce or eliminate harm to human health and environment

    • This directive is the foundation of new regulations


    Environmental regulatory status l.jpg
    Environmental Regulatory Status without compromising the ability of future generations to meet their needs

    • Legal standards similar or equal to EU legislative and policy initiatives:

      • Restriction on Hazardous Substances (RoHS) Directive

      • Waste in Electrical & Electronic Equipment (WEEE) Directives

      • REACH proposal on Chemicals

      • Eco-design of energy-using products (EuP)

    • Prevention and Control of Environmental Pollution Caused by Solid Waste – drafting work recently commenced to amend existing law and include:

      • Control of hazardous wastes

      • Provisions reflecting regulatory concepts such as “extended producer responsibility”


    Do you know about chinese environmental legislation i l.jpg
    Do you know about Chinese environmental legislation? I without compromising the ability of future generations to meet their needs

    • Which of the following products must meet energy consumption standards in China?

    • Air conditioners

    • Irons

    • Refrigerators

    • Rice cookers

    • TV

    All of them have to meet legal standards!

    From 1 March 2005, manufacturers of energy consuming products will even have to join labels to their products including:

    - The name & brand of the producer

    - The degree of energy efficiency

    - The energy consumption volume

    - The China energy standards referenced to determine the product’s degree of efficiency.

    Q


    Do you know about chinese environmental legislation ii l.jpg
    Do you know about Chinese environmental legislation? II without compromising the ability of future generations to meet their needs

    Are Chinese companies required to submit reports on their energy consumption?

    Of course they are!!!

    Much more than a simple statement on their level of consumption, companies exhibiting significant energy consumption are required to periodically submit their energy efficiency and the implemented saving measures to the relevant authorities.

    Thus progress in energy efficiency is a legal requirement in China.

    The import of backward energy intensive technology is illegal… before 2008 the law will be reinforced by incentives and disincentives towards businesses in order to promote energy efficiency…

    Q


    Do you know about chinese environmental legislation iii l.jpg
    Do you know about Chinese environmental legislation? III without compromising the ability of future generations to meet their needs

    The approach to hazardous solid waste identification is defined by the law as the prevention and control of environmental pollution by solid waste.

    What about liquid waste?

    The hazardous waste identification approach applies to liquid as well as solid waste.

    • Main aspects of the law are the following :

    • entities engaged in the business of collecting, storing and disposing hazardous waste shall apply for licenses;

    • Government may impose discharge fees on those responsible for the waste discharge that do not comply with relevant environmental laws;

    • Hazardous wastes are listed in an exhaustive catalogue;

    • Changing the land use of a previously waste dedicated area is submitted to legal control.

    Q


    Do you know about chinese environmental legislation iv l.jpg
    Do you know about Chinese environmental legislation? IV without compromising the ability of future generations to meet their needs

    Is it legal to import waste into China?

    Waste import is basically forbidden (or at least highly restricted), except when it can be used as raw material.

    Movements of waste are strictly monitored and controlled. This is true for trans-boundary waste shipment, as well as for waste movements between Chinese provinces.

    Q


    Initiative taken in china sustaining natural resources l.jpg
    Initiative taken in China - Sustaining natural resources without compromising the ability of future generations to meet their needs

    • Land and soil

    • Actions and programs

    • Success and Targets

    • China has afforested around 46.7 million hectares since 1950, this is about 26% of total woodland

    • The afforested area is planned to reach 110 million hectares in 2050, around 28% of China’s total area

    • China has initiated a program to stop desertification between now and 2010, to start reducing desertificated areas from 2010-2030 and to redevelop desertificated areas from 2030-2050

    • In some regions soil erosion has been stopped by redeveloping farmland into woodland

    • * Ref: UNIDO


    Structure44 l.jpg
    Structure without compromising the ability of future generations to meet their needs

    Sustainable development

    Facts about China

    Sustainable development in China

    Business role and responsibilities

    Implementation


    The business environment l.jpg

    Term of office without compromising the ability of future generations to meet their needsfor head of state

    Conflicting time scales

    Life of major consumer items

    Life of energy production capital stock

    Time to change beliefs

    and habits

    Lock-in caused byurban design

    Years

    0

    50

    100

    150

    200

    The business environment


    Business demands l.jpg
    Business demands without compromising the ability of future generations to meet their needs

    • Doing Business in a networked world

      • Information,knowledge, people and goods move around the globe as never before.

    • Beyond compliance, businesses need to meet international agreements & standards

      • Investors & international market - increasing demand for sound SD practices

      • Trends : accountability and transparency

    • Companies face increasing and partly conflicting demands from stakeholders:

      • Shareholders - high returns

      • Customers - affordable and high-quality products

      • Public pressure groups - more environmental protection and social engagement

      • Trends – accountability and transparency

      • Employees – safe and healthy workplace with fair compensation


    In summary why is sd in china so important for businesses l.jpg
    In summary: without compromising the ability of future generations to meet their needsWhy is SD in China so important for businesses?

    • China’s environmental impact affects the whole world

    • Great business opportunities for both Chinese and foreign companies

      • Major economic growth in China: large country of (potential) consumers

      • Economy open to both foreign and local investors

      • High quality and availability of labor force

    • Investors increasingly demand sound SD practices

    • Sound SD practices as a criterion in selection of suppliers

      • Sound SD practice is becoming a “license-to-export”

      • Compliance with global environmental regulations required

    • Olympics scheduled in Beijing in 2008

      • Opportunity to show the world that Chinese business practice includes sound environmental and social management


    The business case for sustainable development l.jpg
    The business case for sustainable development without compromising the ability of future generations to meet their needs

    • The business case for sustainability is a concept promoting corporate sustainability based on economic logic.

    • It points to opportunities companies have to create economic value by means of improving

      • environmental performance

        e.g. increase eco-efficiency, reducing pollution

      • social performance

        e.g. engage in community development

        beyond compliance.


    Improving business performance l.jpg
    Improving business performance without compromising the ability of future generations to meet their needs

    Short term

    • Demand from the emerging world= huge market opportunities

      • Consider local needs and conditions

    • Cleaner & more efficient production = better industrial efficiency and cost-effectiveness

    • More efficient/eco-friendly products = Less use of resources and energy and less waste generation = cost effective for the business and for consumers

    • Transparency, social standards, codes of conduct are part of the company‘s image

    • SD policy is taken into account more and more by investment groups and financial analysts = providing the company more financial access

      (Even stock exchanges are joining the Global Compact!)


    From risk to opportunity l.jpg
    From risk to opportunity without compromising the ability of future generations to meet their needs

    Longer term

    • Sustainable use of finite resources

    • Minimizing environmental impacts of business operations

    • Enhance stability in the communities where the business operates

      • The reduction of regional inequities on a global scale is necessary to preserve the stability that business needs to make profit.


    Example cleaner production l.jpg
    Example: Cleaner production without compromising the ability of future generations to meet their needs

    Efficient use of water, energy, raw materials

    Starting “at the source” (not end-of-pipe)

    • Cost savings on water, energy, raw materials, directly add to bottom-line result

    • Improved efficiency = reduced waste/leakage

    • Technology leadership

    • Contribution to solve environmental issues

    • Positive company reputation

    C


    Example eco efficient products l.jpg
    Example: Eco-efficient products without compromising the ability of future generations to meet their needs

    More efficient and eco-friendly products

    Example: Energy Star products (the US)

    Blue Angel (Germany)

    • Preferred by consumers = lower running cost of equipments & tax breaks = lower cost in the life cycle = company can place a price premium = higher profits

    • Technology leadership and brand recognition

    • Contribution to solve environmental issues

    • Less concern for the waste if using less toxic materials = more appealing products

    C


    Example health safety l.jpg
    Example: without compromising the ability of future generations to meet their needsHealth & safety

    Healthy, happy employees

    & neighbors

    • Reduced medical costs for employees

    • Fewer lost working days

    • More efficient workforce

    • Happy, healthy consumers

    • Positive company reputation

    • Access to highly qualified human capital

    C


    Summary of business roles and opportunities l.jpg
    Summary of business roles and opportunities without compromising the ability of future generations to meet their needs


    Structure55 l.jpg
    Structure without compromising the ability of future generations to meet their needs

    Sustainable development

    Facts about China

    Sustainable development in China

    Business role and responsibilities

    Business implementation


    Evolution of tools l.jpg
    Evolution of tools without compromising the ability of future generations to meet their needs

    Sustainable

    Livelihoods

    CSR

    Economic Instruments

    Env. Footprint

    Co-regulatory Agreements

    Responsible Entrepreneurship

    Command & Control Legislation

    Sustainability

    Factor X

    Agenda 21

    Eco-efficiency

    Our

    Common Future

    Cleaner Production

    Government Agenda

    Compliance

    Business Agenda

    SustainabilityStrategy

    EMS

    Standards

    ICC-Charter

    EHSAuditing

    Time


    Implementing sustainable development l.jpg
    Implementing sustainable development without compromising the ability of future generations to meet their needs

    • Has your company taken any SD initiatives?

    • Can you identify any gaps?

    • What can you do as an individual, as a team, function or company, to contribute to limit use of energy, water and other resources?

    • What resources will enable you to achieve this? Can you identify any barriers?

    Assess the situation

    Measure success

    Develop a strategy

    Implement

     Alternative model: The Sigma Guidelines provide a systematic model of sustainability management (www.projectsigma.com).

    T


    Assessing general checklist l.jpg

    Benefits to be gained from incorporating sustainable development into business management practices

    Assessing: General checklist

    Does your company:

    • Use energy and water

    • Use natural resources and supplies

    • Generate waste

    • Discharge water, emit air containing chemical substances

    • Produce products that use energy and/or water, or emit pollution

    • Need to comply with environmental legal requirements

    • Have international business practices

    • Provide service/goods to international markets/companies

    • Aim to enhance its public image/reputation and increase company brand value

    • Have concerned stakeholders (government, consumers, businesses, employees, investors, NGOs, etc.)

    Q


    Questions for the board l.jpg
    Questions for the board development into business management practices

    Assessing:

    CSR checklist

    Q


    Assessing eco efficiency checklist l.jpg
    Assessing: development into business management practiceseco-efficiency checklist

    Assessing:

    eco-efficiency checklist

    Q


    Assessing dow jones sustainability index l.jpg
    Assessing: Dow Jones Sustainability Index development into business management practices

    • The Dow Jones Sustainability Index was the first index to try to assess the ability of businesses to creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments.

    • Its methodology looks for the “best in class” in specific sectors. It is forward looking and aims to capture not simply end-of-pipe performance but the drivers and enablers which set sustainability leaders apart in their ability to achieve long-term shareholder value.

    • The index’s methodology appears to work in identifying future value potential: The DJSI has outperformed the base index over the past three years.

    • 12 out of 18 World Market Sector Leaders are WBCSD members

      Automobiles Toyota

      Banks Westpac Banking Group

      Basic resources Alcan

      Chemicals DSM

      Cyclical goods & services Royal Philips Electronics

      Energy Statoil

      Food & Beverage Unilever

      Health care Novozymes

      Industrial goods & services 3M

      InsuranceSwiss RE

      Non-cyclical goods & services Procter & Gamble

      Utilities Severn Trent


    Developing y our company s place in society l.jpg

    Impacts Local development into business management practices

    Economies

    Pollutes Shared

    Environments

    Supports Workers

    and Families

    Provides Goods

    & Services

    Uses Communal

    Resources

    Consumes

    Limited Resources

    Provides Health

    Care & Education

    Influences

    Government

    Developing: Your company’s place in society

    Your company is a stakeholder in many shared societal processes

    Your

    Company

    WRI

    T


    Developing eco efficiency l.jpg
    Developing: development into business management practiceseco-efficiency

    • One practical way of measuring the environmental performance of business

      • Applicable to every area of activity within a company or the entire value chain of a product or service

        • Should be an integral part of overall business strategy

    • Principle: Doing more with less

      • Combination of environmental and economic performance

    • OECD definition:

      • The efficiency with which ecological resources are used to meet human needs

      • Higher eco-efficiency requires:

        • Providing more value with less environmental impact

        • Re-linking growth of welfare with the use of nature

        • Improving both economic and ecological efficiency

    T


    Developing environmental management system approach l.jpg

    The recognized need development into business management practicesfor Cleaner Production

    1.Planning and

    Organization

    2.Assessment

    3.Feasibility Analysis

    4.Implementation

    Successfully implemented

    Cleaner Production projects

    Developing: Environmental Management System approach

    • Obtain management commitment

    • Organize project team

    • Identify barriers & solutions

    • Set objectives

    • Pre-assess

    • Identify sources (where)

    • Analyse causes (why)

    • Generate possible options (how)

    Sustain

    & Continue

    • Evaluate options on:

      Technical, environmental

      and economic feasibility

    • Select best options

    • Option implementation

    • Monitoring and evaluation

    • Sustain and continue

    T


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    Benefits of an environmentally sound business practice (e.g. EMS)

    • Increases productivity

    • Reduces production costs

    • Produces safer and better products

    • Reduces levels of pollution and risk

    • Improves worker’s safety and health

    • Complies with Environmental Management Systems (ISO 14000) Recognition from business partners

    • Link-up with international markets

    • Improves company image

    Implementation of EMS in all aspects of business will makea company more profitable and competitive

    T


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    Implementing: EMS)Chronos -- the WBCSD’s e-learning tutorial

    • Chronos® is an electronic tutorial designed to increase business interest in, and action on, sustainable development

    • Developed in partnership with the Cambridge University Programme for Industry

    • Aims to encourage employees in a wide range of companies and sectors to reflect on personal experiences, explore situations, and hone problem-solving skills

    • www.sdchronos.org

    T


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    Implementing: EMS)GHG Protocol

    • The GHG Protocol’s mission is to develop internationally accepted greenhouse gas (GHG) accounting and reporting standards for business and to promote their broad adoption.

    • The GHG Protocol Initiative comprises two separate but linked standards:

      • GHG Protocol Corporate Accounting and Reporting Standard which provides a step-by-step guide for companies to use in quantifying and reporting their GHG emissions)

      • GHG Protocol Project Quantification Standard forthcoming, a guide for quantifying reductions from GHG mitigation projects)

    T


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    Measuring (codes, frameworks, guidelines): EMS)Global Reporting Initiative

    • The Global Reporting Initiative (GRI) Sustainability Guidelines are the firstattempt to develop a generalized set of sustainability indicators fororganizations.

    • It has become the main point of reference for companies that producesustainability reports, although only a minority are able to claim theirreports are “in accordance” with the Guidelines.

    • The Guidelines’ development is influenced by companies through astructured dialogue process and the GRI’s multi-stakeholder governanceprocess.

    • The GRI has well developed linkages with other standards within anemerging “global architecture”. (e.g. AA1000 Assurance Standard, UNGlobal Compact, etc.)

    • (www.globalreporting.org).

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    Measuring (codes, frameworks, guidelines): EMS)Global Compact

    • This international partnership brings together UN agencies, business, civilsociety and public sector organizations. Membership is based on a highlevelcommitment to its ten principles, derived from key UN andinternational declarations on labor, human rights, and the environment.

    • The principles themselves are not new, but by bringing internationallyaccepted standards together and framing them as business commitments,the UN Global Compact has set a principle-based global benchmark form corporate citizenship.

    • It is seen as one of the most significant institutions working to alignbusiness and sustainable development. But while more than 1,200companies have signed up, including 200 large multinationals, very fewmajor US companies have joined.

    • www.unglobalcompact.org

    T


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    Measuring (codes, frameworks, guidelines) EMS):OECD Guidelines for Multinational Enterprises

    • The OECD Guidelines for Multinational Enterprises are the closest thing wehave to an comprehensive global corporate code of conduct. It is a keyreference point of international norms for business.

    • While the Guidelines are non-binding on businesses, adheringgovernments are committed to promoting them and to making theminfluential among companies operating in or from their territories.

    T


    Case in point stakeholder dialogue to partnerships degussa l.jpg
    Case in Point EMS)Stakeholder dialogue to partnerships: Degussa

    Summary: Degussa AG with support from DEG (a German investment and development company), in a public-private partnership, conducted a series of training events in Beijing for employees of Chinese paper mills on how to optimize wastewater circuits (2004-2005).

    Drivers/Benefits: To help paper mills reduce their amount of wastewater.

    Results so far: One paper mill implementing zero-effluent technology; several mills short-listed as “Nations Model Clean Production Enterprise”.

    Key success factors: Expert knowledge, working in a public-private partnership, drive of participants to transfer training into practice.

    C


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    Case in Point EMS)Stakeholder dialogue to partnerships: ABB

    Summary: ABB, with the Alliance for Global Sustainability, devised the China Energy Technology Program (CETP), an extensive partnership program bringing together a diverse group of participants to assess the relative costs and environmental performance of different strategies for meeting power demand in China.

    Drivers/Benefits: To identify the true costs of electrical power generation and use and develop cost-effective and efficient solutions for the future, to bring significant environmental benefits, not just to China, but globally.

    Key success factors: Active involvement and participation of academia, industry and the stakeholders involved.

    C


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    Case in Point EMS)Energy recovery facilities: CH2M HILL

    Summary: CH2M HILL was hired to assist the State Environmental Protection Agency of China to advise on technical and economic feasibility and construction requirements for energy recovery facilities at municipal waste landfills.

    Drivers/Benefits: Promote better waste management practices, rewarded with economic benefits from selling recovered methane as fuel.

    Challenges: Institutional barriers to progress; communication & translation problems, funding difficulties

    Key success factors: Commitment from all; quality communication and translation; careful choice of the host country lead agency

    C


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    Case in Point EMS)Local and global standards: Lafarge

    Summary: Lafarge and DuJiangYan Building Materials Co., joint venture agreement to construct a new cement plant in ChengDu, Sichuan province, in line with latest technology, quality and safety standards.

    Drivers/Benefits: For Lafarge -- establishment of substantial & profitable position in region, where an accelerated infrastructure development program fuels increase in demand for high quality cement; for Chinese government -- strategic importance for regional economic development & to reduce persistent supply/demand gap in the region.

    Challenges: Quality control during construction, cultural differences, implementing safety practices, Song relics on site, heavy rains.

    Key success factors: Financial strength and technical support; strong management team; good working relations between Chinese and foreign partners; Government support; listening to the different parties.

    C


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    Case in Point EMS)Introducing EMS: Automobile Company in Anhui

    Summary: This Chinese automobile company first started production in 1968. It went from a loss-making venture with revenue of less than 3 million RMB in 1990 to one of the most important Chinese automobile producers with 5 wholly owned subsidiaries and revenues of 26 billion RMB in 2000.

    Drivers/Benefits: Systemization of processes & operations and introduction of EMS increased efficiency and quality, timely delivery to customers, reduced waste, improved company image.

    Challenges: Culture change within the company needed; long-term process.

    Key success factors: Strong management vision, employee commitment, good cooperation with local government, starting from “at-the-source” principles as opposed to “end-of-pipe”.

    C

    From “Greening Chinese Business” by Ulrich Steger, Fang Zhaoben and Lu Wei


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    Case in Point EMS)Responsible care auditing: BASF

    Summary: BASF systematically conducts Responsible Care (RC) audits of its service suppliers; RC = a voluntary improvement process of the chemical industry, dealing with Environment, Health and Safety (EHS).

    Drivers/Benefits: The systematic method provides a tool to evaluate supplier site risks, in order to select the best alliance partner and to deliver a contribution to society and the environment; contributes to positive company reputation.

    Challenges: Investment in time and effort from both auditing company and service supplier.

    Key success factors: Systematic, realistic method and timescale, using principle of risk = EHS performance x hazard potential; good collaboration between service provider and (potential) customer.

    C


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    Case in Point EMS)“Global” standards: DSM

    Summary:Jinling-DSM Resins is a Chinese-Dutch joint venture producing resins in Nanjing. Employment conditions of its 17 temporary workers were improved to a level in between those of surrounding temporary workers and employees.

    Drivers/Benefits:Achieving the optimum, realistic balance between international standards and local circumstances.

    Challenges:Building on the inheritance of a non-greenfield operation; different cultural perceptions of appropriate employment conditions for temporary and permanent workers.

    Key success factors:Open discussion between management and employees; finding the optimum mix between foreign views and local culture and habits.

    C


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    Case in Point EMS)Sustainable use of waste: Novozymes

    Summary: Novozymes supplies treated wastewater and converted biomass from its production processes free of charge to TEDA to be used for irrigation and as biological fertilizer (NovoGro).

    Drivers/Benefits: Sustainable use of wastes, reduced consumption of limited resource, support for eco-industry, responsible neighbor and good company reputation

    Challenges: Infrastructure for storage and transportation of treated wastewater, composting and expanded application of NovoGro to ensure more sustainable use.

    Key success factors: Close cooperation with TEDA, advanced waste treatment technology, experience in the production and application of NovoGro from Europe and US.

    C


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    Case in Point: EMS)Fuyang Chemical General Works

    Summary: Chinese fertilizer plant, in collaboration with Chinese authorities and CIDA implemented Cleaner Production, starting with zero- and low-cost measures and continuing by implementing medium cost measures.

    Drivers/Benefits: Enabled reduction of product losses, efficient use of raw materials and energy, reduced emissions, reduced waste, healthier working environment, increased revenues, improved company reputation.

    Challenges: Collaboration between parties with different experience levels, overcome initial investment requirements for medium cost measures.

    Key success factors: Management commitment & employee participation, tackling zero- and low-cost elements first, partnership with Chinese government, training & sharing of information, stimulating gender equity.

    C

    From the China-Canada Cooperation Project in Cleaner Production“Picking Low-hanging Fruit: The Strategic Role of CP in China” by M. Osterman, LL.L.CEA



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