Nikki Samme explains the structure and role of the environmental management system

(EMS) standard ISO14001. Since its introduction in 1996, the standard has become a
cornerstone of corporate environmental governance. Over 125,000 ISO14001 certificates
have been issued in more than 130 countries. There has been historically strong market
penetration in Europe and South East Asia, with certification in North America gathering
pace over recent years.

Many organisations are under increasing pressure from stakeholders and regulators to
demonstrate that they are managing the environmental impacts of their business
activities responsibly and effectively. At the same time, a recent BSI survey (Reference
1) of FTSE250 businesses highlighted that as many as 70 % of companies are concerned
about the rising cost of energy, nearly half (45 %) worry about waste management, and
a third (30 %) are concerned about carbon emissions. Within this climate of stakeholder
pressure, and a growing trend towards more responsible corporate governance and
environmental awareness, many organisations are considering implementation of an
EMS. But what is an EMS and what benefits can it bring to a business?

BS EN ISO 14001:2004 (to give the standard its full title) is one of several standardised
management systems that can be adopted by an organisation (Reference 2). Others
include the European Eco-Management and Audit Scheme (EMAS) and British Standard
(BS) 8555 'Environmental Management Systems – specification and guidance for use’.
EMAS has similar objectives to ISO14001, but includes additional requirements such as
an independently verified annual report. Conversely, BS 8555 provides a more flexible,
step-by-step approach for smaller organisations working towards EMAS or ISO14001
(Reference 3). BSI's scheme, known as ‘STEMS’ (Steps to Environmental Management
Systems) involves the assessment and recognition (by a Certificate of Achievement) of
each phase of the implementation of an EMS. It has been particularly targeted at smaller
enterprises which may not have the resources or know-how to commit initially to a full
EMS.

ISO14001 is part of a family of ‘generic’ environmental management standards. The

term ‘generic’ simply relates to a flexible standard, one that is equally at home in either
manufacturing or service industries, multinational companies or SMEs, public or private
sector organisations. ISO14001 is therefore neither sector- nor product-specific. It is,
however, directly compatible with ISO 9001, the international quality management
standard. ISO9001 can therefore be used as a platform towards adopting an EMS. In
addition, EMSs can be used as a framework to co-ordinate other corporate governance
tools, such as sustainability reporting and carbon footprinting.
While most EMSs are adopted voluntarily, in some cases they may form an integral part
of regulatory guidance. For example, an EMS is regarded as a component of ‘BAT’ (Best
Available Techniques) under EU industrial pollution prevention and control legislation. In
the US, the Environmental Protection Agency and some US states have enacted or
propose regulatory incentives for companies that adopt EMSs.

ISO 14001 specifies the features and processes necessary to help organisations
systematically identify, evaluate, control and improve the environmental impacts of their
business activities (see Figure 1). In other words, the standard defines what an
organisation needs to do. However, it does not prescribe how an organisation should
meet the requirements, nor does it set specific environmental targets. This approach
allows each enterprise to adopt the standard flexibly, reflecting site-specific
environmental aspects and management priorities. The principle of continual
improvement is fundamental to delivery of a successful EMS. EMAS and ISO14001 both
require a dynamic, evolving management system, with the bar being raised regularly
through audits and management reviews. Maintaining the status quo once an EMS is in
place is not enough to achieve compliance.

Figure 1
Key Stages of EMS Implementation

An EMS may be independently audited and certified by an external, accredited

organisation such as BSI. Certification is a significant, longer-term business
commitment. There are reputational risks for companies that secure certification, but
then either allow their certification to expire, or have their certification withdrawn. Other
organisations may choose to operate a system that conforms to the requirements of
ISO14001 or EMAS, but without seeking certification. Whether an EMS is certified or not,
its success is highly dependent upon senior management buy-in, and sufficient staff and
financial resources being made available. Without senior support and the necessary
resources in place, an EMS is much more likely to fail.

BSI estimates (Reference 4) that one in three FTSE 250 companies do not have an EMS.
This is despite the fact that the majority of FTSE businesses recognise the commercial
and environmental benefits that an EMS can bring:

- 94% recognise that it can improve environmental performance;

- 54% believe it can enhance corporate reputation;
- One in 10 believe it enhances competitive advantage and achieves cost savings;
- 76% believe customers will be more interested in companies with an EMS in the next 10
years;
- It can be a differentiator in winning new business, and is indeed a pre-qualification
requirement for many public and private sector tenders.

Similar outcomes have been reported from a further UK survey (Reference 5). This
reported that 70 % of companies with an EMS were delivering significant environmental
improvements, and that 90 % of respondents felt that the costs of implementation were
either more or less the same as, or were outweighed by, the benefits brought by the
EMS.

How does ISO14001 translate into practical benefits for business? Many leading
companies including Rolls Royce, George Wimpey and the Smiths Group have
implemented an EMS, and recognise its value in attracting and retaining business.
Importantly, ISO14001 is also being used to influence the supply chain – the automotive
sector is a good example. Ford, General Motors and Toyota are among motor
manufacturers who have worked with their direct (Tier I) suppliers, encouraging them to
achieve ISO14001 certification in order to remain a preferred OEM supplier.

In summary, stakeholder expectations, supply chain management and legal compliance

are likely to be key drivers for ISO14001 in the near future. In addition, further
integration with other management standards (for example, quality management and
health and safety) and corporate governance initiatives will ensure that EMSs form key
management and decision making tools.

Useful Links & References

BSI Management Systems website - www.bsi-global.com
1. BSI Press Release 16 October 2006. UK standards body BSI calls for more businesses
to go green
2. Webb, B., Chilvers, J. and Keeble, J., 2006. Improving Business Environmental
Performance: Corporate Incentives and Drivers in Decision Making. A report to the
Department for Environment, Food and Rural Affairs by Arthur D Little Ltd. Defra,
London
3. The Institute of Environmental Management and Assessment (Undated) E-brief:
Environmental Management Systems
4. BSI op. cit.
5. ENDS Survey 2006

About the Author

Nikki Samme is Marketing Communications Manager at BSI Management Systems.
Contact via their website.