How five companies reduced environmental risks and saved money
Press release: August 22 2002
by Denise Wecker-Seipke
What do Electrolux, Sony, Ericsson, Delphi and General Motors have in common? They're among the growing number of companies that have implemented environmental management systems and become registered to ISO 14001, the international standard for EMSs. As of May 1, nearly 2,000 U.S. companies had obtained ISO 14001 registration. That number jumps to 3,168 if you include those in Canada and Mexico.
An EMS provides an efficient framework for managing environmental responsibilities. It also helps companies integrate improvement efforts into their overall business operations.
Electrolux avoids fines and disposal costs
Electrolux Home Products (formerly Frigidaire) in Greenville, Michigan, began its ISO 14001 efforts in 1999. Its first big savings under the new system came when the company followed its documented procedures and avoided a $70,000 fine for a spill by a contractor on its site.
As part of its EMS procedures, Electrolux stipulates that all contractors must be licensed for whatever activity they're conducting on the company's site. The licensed contractor spilled raw sewage it was pumping out of an underground tank. Electrolux reported the incident to the state's Department of Environmental Quality (DEQ).
In its investigation, the DEQ determined that Electrolux had taken the necessary precautions to prevent a spill and that the company's follow-up would help in preventing future occurrences. Consequently, Eloctrolux wasn't fined. The DEQ sent a letter stating that it would have fined Electrolux if it hadn't proved it had procedures in place to prevent such an occurrence.
In addition to overall cost savings from registration, Electrolux reduced costs through meeting objectives and targets set within its EMS, particularly in the way it handled solid waste materials. Prior to implementing ISO 14001, the company hauled away scrap materials for disposal. The 45-mile trips?made three times a week?incurred significant labor, vehicle and fuel costs. But by rethinking the process and installing a compactor, the company significantly cut the volume of scrap being transported. Disposal trips are now made once a week, a change that saves fuel and labor costs and reduces equipment wear.
Sony seeks sound EMS
In April 2002, Sony Corp. of America's operating units received ISO 14001 registration from BSI. The registration covers all 73 of SCA's non-manufacturing operations in North America, including Sony Music Entertainment Inc., Sony Pictures Entertainment, Sony of Canada Ltd. and Sony Electronics Inc. It also covers AIWA America.
Sony pursued registration as part of a companywide commitment to environmental matters, to improve document control and to gain further impetus for continuous improvement. “This certification is part of Sony's overall effort to preserve and enhance the environment and protect the safety and health of our employees, customers and neighbors," says Mark Small, vice president for corporate environment, safety and health issues at Sony Electronics.
The environmental efforts of SCA companies include recycling, energy conservation, waste reduction, local outreach programs, and health and safety issues, such as fire and emergency preparedness. The company has also undertaken an internal education program to ensure that employees are aware of the steps they can take to improve their environments.
Previously, Sony had succeeded in earning ISO 14001 certification for all of its manufacturing sites worldwide. In addition, the company has reduced its recycling rate by more than 95 percent at 17 sites, introduced products with lead-free solder and halogen-free printed wiring boards, and reduced and/or replaced its packaging materials.
The company's Pitman, New Jersey, site includes a 500,000-square-foot manufacturing and distribution center for prerecorded digital media. Since becoming registered to ISO 14001, the company has established management reviews, objectives, and environmental initiatives and has implemented related improvement programs quickly and efficiently.
For Sony, ISO 14001 registration has:
- Complemented the company's other quality management programs
- Strengthened management commitment
- Increased employee motivation
- Improved document control
- Expanded the scope for environmental initiatives
- Reduced resource use
- Increased local community involvement
Ericsson calls for global EMS
In December 2001, Ericsson received worldwide ISO 14001 certification. This marked the first time a company received one ISO 14001 certificate that encompassed both manufacturing and non-manufacturing international operations.
In 1999, Ericsson decided to expand the scope of its EMS companywide, convinced that real environmental contributions would come when all its employees were committed and involved.
“The way we've developed our EMS enables Ericsson to clearly identify our environmental impacts, set goals and manage performance against those targets," says Lars G'ran Bernau, Ericsson's director of sustainability and environment. “This provides key management information not tied to any specific organizational structure."
The company's global EMS provides critical information for management. It systematically measures Ericsson's environmental impacts and ensures that environmental objectives are on track and met. Consequently, Ericsson can identify key environmental aspects of any operation. Once identified, it can then concentrate its efforts on those areas that will make the greatest impact.
Delphi Saginaw steers toward waste reduction
Energy reductions are one of the biggest cost savings when companies register to ISO 14001. Delphi Saginaw provides a classic example. “To make any improvements, you have to be able to measure what you are and make an analysis of where your problems are," says Mark Wittbrodt, facilities engineer at the company's Michigan site.
As part of that process, more than a year ago Delphi Saginaw initiated “energy walks" during periods of shutdowns, such as weekends or holidays. A Delphi energy team would look for air leaks or other ways to reduce energy consumption. The team would then produce an energy audit report, which assisted the company in identifying corrective actions that would improve controls.
One problem discovered on such a walk concerned water usage. At the site, water pours nonstop through 3-inch mains. Employees didn't shut down the mains during off hours because they thought the cost of water was too negligible to have an impact on either cost or risk factors. The water ended up in a batch tank for treatment, regardless of whether it was mixed with coolant or was clean. Failing to shut off the water mains was costing Delphi an additional 40 percent in water treatment costs. The company has since plugged this energy leak.
Because its energy walks proved so successful, Delphi has stepped up its efforts by means of an energy-monitoring computer system. The new system allows the company to narrow its focus from plant-wide to departmental usage. A specialist from its corporate offices concluded the Saginaw facility can improve its energy-reduction efforts by 20 percent and save an estimated $2.5 million on its annual $20 million energy bill.
Wittbrodt adds that the potential savings don't always involve a capital investment but can be earned simply by shutting down big processes. However, with some capital investment to fix steam trap leaks, additional site savings of up to $14 million annually are expected.
GM drives down waste and saves
General Motors' Flint Metal Center in Michigan has taken aggressive steps to monitor and reduce energy usage. The 2 million-square-foot plant is a three-shift, 2,800-employee operation. After implementing ISO 14001, it documented tremendous energy savings and increased revenue through better waste management.
Because the facility consumes so much electricity, the local utility supplier employs an engineer who works full-time at the site to help measure energy usage. On Jan. 1, 2001, the plant began tracking energy use on weekends, shutting down processes whenever possible. Because the facility is so large, a group of employees developed a how-to manual for plant equipment shutdown during periods of non-production. The focus was on establishing appropriate controls. Every Monday, the metal center measured how successful it was in conserving energy during the preceding weekend.
A review of the plant's weekend and holiday energy use during the past three years tells the story. During the four-day Thanksgiving holiday in 1999, the facility used 448,918 kilowatt hours. During that same holiday two years later, it used only 174,299 kilowatt hours, representing a 61-percent reduction. Shut-down efforts for 2001 translated into $250,000 in savings. Michael Lekse, director of manufacturing engineering at the facility, says those savings alone covered the cost of developing and implementing the EMS.
Because the shutdown manual produced such positive results, GM honored the facility with one of three companywide energy awards and is implementing the shutdown manual at all of its metal-stamping plants.
GM Flint Metal Center is also managing its waste streams, such as copper and wood, more effectively. Prior to ISO 14001 registration, the facility shipped wood as trash to a landfill. Subsequently, it found a client that burns wood as a heat source. Now instead of paying to landfill wood, the facility sells it. Another waste management project is copper recycling. Copper welding tips must be replaced after a certain number of uses. Formerly, those tips were combined with other metal pieces and sold as scrap. However, a cross-functional team, formed as part of GM's ISO 14001 efforts, began targeted collections within departments that use the copper welding tips. GM now sells the tips separately because used copper has a much higher value than other scrap metal.
“ISO 14001 and doing what's right for the environment complements GM's business goals," says Lekse.
Conclusion - ISO 14001 saves money and reduces risk
Whether they're looking for cost reductions, improved environmental performance, energy savings or an enhanced corporate image, implementing ISO 14001 allows organizations to address the environmental impact of their activities, services, products and people. The standard provides a framework so that companies can identify significant environmental issues and implement appropriate management programs to control and improve them. The bottom line is that ISO 14001 saves money and reduces risk.
About the author
Denise Wecker-Seipke is the EMS technical expert for BSI Management Systems. Her background includes broad training and development work in environmental science and environmental management, as well as extensive EMS auditing experience in diverse industry and service sectors.