1. Project details Name of project
Using supply chains to reduce environmental impact 2. Scope
2.1. Background There is increasing interest in European Union member states in using complementary interventions alongside traditional methods, such as environmental inspections, to improve the implementation and compliance of environmental legislation and deliver better environmental outcomes.
In 2011 IMPEL carried out a project to explore the use and effectiveness of complementary approaches to inspections for ensuring compliance. This project identified the most commonly used approaches in IMPEL members states and recommended that there should be more practical projects on how to apply specific approaches.
This project will support the “Choosing appropriate interventions alongside inspections to ensure compliance and achieve environmental outcomes” (CAI) project. It will explore methods and tools used by industry to reduce the environmental impact of their activities through their supply chains. It will seek to better understand how inspectorates can work with regulated industries and improve recognition and account taken by Environmental inspectorates of supply chains to improve compliance. We will share experiences on approaches used and explore how to motivate regulated industry to improve their environmental compliance and performance.
European industry produces a range of environmental impacts at all stages of the supply chain, from primary resource extraction to the use of final products by the consumer. These supply chains are increasingly spread across Europe and the world. The focus of regulation tends to be on specific sites or plants – often production sites or production plants. However this risks neglecting the environmental improvements if each step in the supply chain were to ask its suppliers for even a small change in environmental performance and we don’t yet understand how powerful this might be. Companies are increasingly imposing environmental requirements on their suppliers to protect the companies’ reputations, to aid with their own compliance, and to meet customer expectations, among other reasons. For example one study of 74 firms in eight sectors found that over half impose environmental requirements on suppliers, representing more than 78 percent of all of the sales of the top firms in the sectors. Clearly, supply chain requirements are playing an important role in environmental performance. These requirements act as both a private enforcement
mechanism for supply chain requirements that are part of an environmental regulatory regime and as a means of driving beyond compliance behaviour preferred by the company and its customers.
Other organisations such as Proctor & Gamble Ltd have introduced an environmental sustainability scorecard analysis tool which they use to assess the environmental performance of their suppliers and supply chains. They also use this to assess and identify areas where their suppliers might improve. The Scorecard measures nine metrics which include energy use, water use, waste disposal and greenhouse gas emissions.
The project will look at the potential of improving environmental
performance through the supply chain. The impact of supply chain pressure as a motivator is likely to vary depending on the position of the business within the supply chain, this would be taken into account when tailoring the survey to IMPEL members and others. This project is proposing to focus on particular sectors. A number of sectors such as Chemicals, Combustion, Power, Steel, Construction, Waste or Cement could be of particular interest but if there are other sectors other IMPEL members feel are important this will be taken into account. The Chemicals sector and REACH could be ideal due to the duty of registration placed on producers and importers to register substances with the European Chemicals Agency and the
transnational nature of the REACH legislation. REACH also places a duty on producers and importers to communicate the information contained in registration through the supply chain and they are responsible for ensuring the substances do not adversely affect human health or the environment. Another sector which could be of particular interest from a regulator perspective is the waste sector, processing of waste, and the end of waste quality protocols (waste stream).
As a regulator it is important to better understanding of the sectors we regulate and their interaction in order to improve compliance and reduce environmental risk and impact.
2.2. Directive / Regulation / Decision
Industrial Emissions Directive Seveso II
RMCEI
Road map for a Resource Efficient Europe Energy Efficiency Directive
European Blueprint for Water EU ETS
REACH
Waste Quality Protocols 2.3. Article and
description
How can we raise the profile of a firm’s environmental performance and compliance among the firm’s peers within their supply chains, so that we can improve the performance of firms in IMPEL member states. This could explore the relative effectiveness of:
i. Providing information on environmental compliance
ii. Facilitating the measurement of resource use and material productivity (re-use of materials)
iii. Providing more common information to enable firms to judge the compliance of their suppliers where those suppliers are located in other European states
2.4 Link to the 6th EAP
Article 3 of the “Decision No 1600/2002/EC of the European Parliament and of the Council of 22 July 2002 laying down the Sixth Community Environment Action Programme” states:
“improved exchange of information on best practice on implementation including by the European Network for the Implementation and
Enforcement of Environmental Law (IMPEL network) within the framework of its competencies”
2.5. Link to MAWP Strategic Goal II: Improving methodologies Strategic Goal III: Development of good practices Strategic goal VII: Exchange of experiences
2.6. Objective (s) Our overall aim is to understand how we can improve the environmental compliance and performance of industry.
Find and provide examples from companies operating in IMPEL Member States to improve awareness of operations from design through to
production to marketing in order to show how industry can improve resource use and material productivity.
Explore where in the supply chain it is most effective to influence
environmental compliance and performance (e.g. resource efficiency) and in what sectors.
Review the role that the regulator, trade bodies and other private sector interests may have, including via co-regulation and assurance schemes. Share best practice and experiences in IMPEL Member states to identify approaches that work and are effective as well as identify those that have been less successful and why. Identify any issues that arise if one or more states begin to apply these techniques.
3. Structure of the project
3.1. Activities The first stage of the project will be to review current tools and methods being used and applied. We will also review existing information relating to the effectiveness in managing and using tools and methods to improve the environmental performance and impact of supply chains.
The project team with support from the consultant will then develop a questionnaire which will be sent out to IMPEL members and industry to identify existing practices and experiences.
The project team supported by the consultant will identify a number of key organisations which will be used to create case studies.
A workshop will also be organised for IMPEL Members where the project team will share findings, discuss theories and test case studies.
The project team with the support of the consultant will produce a report which will include case studies, tools and methods currently being in use.
There has been an amount of money set aside for consultancy support for this project and the consultant will be used for the following tasks:
Conducting research of existing information and to identify the organisation/s to be used for the case studies
Develop the questionnaire and distil results for the draft report
Designing the workshop
Running the workshop
Write case studies and reports
Project meetings
3.2. Product(s) Case studies of effective strategies and practical tools used to improve the environmental compliance and performance of industries within supply chains in IMPEL member states.
Summary report of the results of the project and a set of concrete recommendations building on best practice.
3.3. Planning (Milestones)
Identification of project team Identify and engage a consultant Project setup and literature review
Development of Questionnaire and interview materials Conduct interviews and focus groups
Draft report
Submit draft for approval
4. Organisation
4.1. Lead Environment Agency of England and Wales 4.2. Project team Romania
Sweden
The Netherlands Germany
Third party participants (for example industry associations and research institutions)
4.3. Participants The project will be lead by the Environment Agency for England and Wales 5. Quality review
The quality of the project will be reviewed by the project participants and appraised by the Cluster (to be decided following review of Clusters 1 and 3). It will then be submitted to the IMPEL General Assembly for appraisal and adoption.
6. Communications 6.1. Dissemination of results
The report will be put on the IMPEL website and disseminated to the national coordinators in IMPEL Member States. The report will also be shared with EU institutions and articles published in key technical and professional European Journals where possible and appropriate. 6.2. Main target
groups
IMPEL Member States OECD
European Commission
European Environment Bureau
We will also try and share the results with private industry to provide examples of how they can improve their environmental performance. 6.3. Planned follow-
up