1. “For even as we celebrate tonight, we know the challenges that
tomorrow will bring are the greatest of our lifetime - two wars, a
planet in peril, the worst financial crisis in a century”.
– Barack Obama Victory Speech (2008)
David Cameron promised to lead:
'the greenest government ever'.
- David Cameron, 2009
If the federal government had been around when the creator was
putting his hand to this state, Indiana wouldn't be here. It'd still be
waiting for an environmental impact statement.“
- Ronald Reagan, 40th President of the United States, 1981-89
7-1

2. Dr. Miles Weaver,
Senior Lecturer in Strategic Management,
Leicester Business School
mweaver@dmu.ac.uk
Join an ongoing debate:
With your lecturer: @DrMilesWeaver
Classmates & the world using #GreenBiz
Student appointments & availability each week:
http://drmilesweaver.our.dmu.ac.uk/appointments/
Or via the ‘Green Business’ blackboard site link

3. After this lecture and independent study you should be able to:-
 Discuss how organisations use information to inform decision-
making on environmental issues
 Describe what an Environmental Impact Assessment (EIA) is and
when one should be completed
 Understand how an organisation might measure current
environmental performance (i.e. environmental review)
 Understand how an organisation might monitor and evaluate
environmental performance (i.e. environmental auditing)
 Describe how an organisation might minimise environmental
impact (i.e. life cycle analysis or assessment)
Miles Weaver 1-3

4. 1. Different responses to
environmental
challenge: range from
do nothing/minimal
compliance to pro-
activity
2. Decisions and actions
need to be based on
information about the
firm and its operations
1-4

5.  Think of a product  What types of questions
might this producer wish
and discuss with to ask to minimise its
your partner what environmental impact?
activities the
 How might this producer
producer takes to measure its
minimise its impact environmental impact?
on the  Consider would this be
environment? different if it was a
service?
7-5

6. 3. Key questions include: 4. Key activities include
information gathering;
analysing and evaluating;
 current environmental monitoring; managing;
impact? formulating and
implementing decisions
 impact of proposed new
projects?
 performance against
5. Processes and procedures
integral part of shaping
stated environmental policies
objectives/policies/ and strategies and
gov’t regulations? establishing an
environmental
 cradle-to-grave impact? management system
1-6

7. EXAMPLE ….
1. EIA (or Environmental Assessment) basically NEW VECTRA AND ASTRA
a procedure for identifying, analysing and
evaluating the impacts of a proposed action
(e.g. new development) on the environment
prior to the action taking place
2. Welford and Gouldson (1993) describe it as a
framework or methodology to minimise the
potential impacts of new developments at
the earliest possible stage - the design and
development stage
 New Vectra/Astra example (product design)
 End of Life Vehicles Directive ( Directive 2000/53/EC -
the "ELV Directive")
 officially adopted by the EP and Council in September
2000 and was published in Official Journal L269 on 21st
October.
7-7

8. Where is the natural environment emphasised in:
 Organisational theory?
 Strategic management?
But ……
Where does the
Information for business decision-making come from?
Environmental assessments, audits and reviews
7-8

9. 3. Procedure helps decision-makers (e.g. planning authorities) to decide
whether new proposals should be allowed to go ahead (e.g. route of new
motorway: new airport/extension to existing airport)
DISCUSSION POINT:
HEATHROW EXPANSION?
 What is the potential impact
of a new runway at
Heathrow on the
environment?
 Who or what might it effect
be?
 How has the potential
impact been measured?
 Or HS2?
Miles Weaver 1-9

11. 4.Impacts include social and economic as well as
environmental consequences of proposed
development - expressed in appropriate
measures (e.g. habitat loss) - cf CBA which
utilises monetary values
5.Anticipatory and participatory EM tool -
measures all major elements of proposal and
relates to operational environment (existing and
future). Baseline information on current
position and likely changes if project proceeds
1-11

12. 6. Developer responsible for assessment. Needs to
identify impacts and measures to minimise adverse
effects
7. Occurs before a decision - allows
review, reconsideration, discussion of
alternatives, preventative action where necessary
8. Traditionally associated with decision-making on
planning applications - formal process of
information gathering and analysis on impact of
new proposals likely to have significant
environmental impact
1-12

13. 9. Came to prominence in EU with
Commission Directive of 1985
(implemented 1988) making it
compulsory for certain projects
(e.g. oil refineries; storage of
radioactive waste; chemical
institutions; motorways; power
stations)
10. ‘Directive’ i.e.
implementation decided by
national governments (in EU)
1-13

14. 11. Other (non-mandatory) projects subject to
planning laws (e.g. in UK-developments in
environmentally sensitive areas)
12. Relates to projects but can also be used to
assess policies, plans and programmes (i.e.
strategically). Welford and Gouldson (1993)
say its use can be good business practice
(e.g. assists internal decision-making process)
1-14

15. 13.Roberts (1995) suggests 4 basic principles to EIA:
 identification of consequences of proposed
action (including possible
alternatives/locations)
 identification of relevant aspects of
environment affected
 evaluation of impacts - initially and
subsequently
 management of beneficial and adverse
impacts
 Implicit in basic structure of an EIA
(see blackboard for document)
1-15

16. 14.Key requirements include:
 identifying nature of and reasons for project
 discussion of alternative sites/processes and justification for choice
 provision of baseline data on local environment and ecosystem
 assessment of physical, social and economic impact (e.g. direct/indirect;
short/medium/long term; temporary/permanent; positive/negative;
cumulative)
 identification of mitigating measures (e.g. techniques/technologies/
alternatives/ likely effectiveness)
 consideration of contingency measures/ risk assessment etc.,
 recognition of difficulties in underlying assessment (e.g. information
problems; risk assessment)
1-16

17. 15.Culminates in a statement - subject to public and political scrutiny
16. Can be costly - but can be beneficial to undertake (in simplified form)
even if not required by law
17. Welford and Goulson (1993) suggest 4 main areas of benefit:
 Business benefits (e.g. helps build environmental awareness; avoid
future problems)
 Operational benefit (e.g. can encourage improved efficiency, reduced
waste, reduced risks, reveal new opportunities/savings, encourage
EMS)
 Legislative and stakeholder benefits (e.g. avoids possible future
problems; encourages better practices; anticipatory behaviour)
 External relationships (e.g. better community image)
1-17

18. 1. Basically an initial assessment of how a firm is performing
environmentally - i.e. impact of its current activities. Also
called ‘baseline environmental audit’
2. Aid to policy-making ( e.g. company environmental
objectives and policy) and to future planning for
improvement - may be undertaken internally or through
consultancy
3. Precursor to introduction of EMS and of Environmental
Audit
1-18

19. 4. Whereas environmental audits are part of regular cycle,
reviews are one-off exercises to provide baseline
information for subsequent finalisation of an environmental
policy, establishment and implementation of an action plan,
introduction of EMS and of regular audit of performance
5. Process often starts with setting preliminary objectives and
consideration of extent of programme to be undertaken
(i.e. what is to be covered in programme, what are priorities,
who should be involved, what methodology, data
requirements etc.)
1-19

20. 6. Review process then essentially an exercise in
gathering information and data on the
environmental situation currently facing the firm
(e.g. measuring environmental impact, examining
legislative requirements, identifying management
systems and their effectiveness)
7. Equivalent to the ‘Environmental Effects
Inventory’ under British Standard on Environmental
Management Systems (BS7750)
1-20

21. 8. KEY CONCERNS INCLUDE:
 identifying current  prevention and mitigation of
environmental impact accidents/health and safety issues
(e.g. noise, odour, effect
 transport and distribution
on air/water/land)
systems (including dangerous/toxic
 waste management
processes (incl. recycling) waste)
 materials  materials usage (e.g. paper and
handling, storage, manage packaging)
ment  legal liability assessment
 sites and buildings (e.g.  information on external pressures,
energy efficiency; constraints, opportunities
potential for
contamination of site)
1-21

22. 9. Review covers environmental aspects of
input, throughput, output and distribution
processes and these are subsequently re-examined
by the environmental audit
10. Usually culminates in a report outlining findings
with recommended actions and targets. May
include information on parts/divisions/departments
within the organisation. Provides basis for adoption
of an environmental policy and introduction of
full system of environmental management and
auditing
1-22

23. 1. Auditing is familiar process in business –
essentially checking outcomes against stated
aims/objectives/policies
2.Environmental audits (‘green’ or ‘eco’ audits) –
process for checking, on a regular basis, the
environmental performance of the
organisation (or activity) in relation to internal
objectives/policies and procedures and the
need to comply with statutory requirements
3. May be done internally or through consultants
1-23

24. 4. Audits provide a means of:
 Monitoring performance of EMS
 Verifying compliance with statutory obligations
 Verifying compliance with stated environmental objectives/policies
 Minimising exposure to risk from the environment
 Identifying and assessing the risk from potential environmental
problems
 Providing information on how to improve company performance
Multistage process involving checking records, examining
company policy and stated objectives, management processes
and systems, interviewing staff, inspecting the site, sifting
information/data, evaluating the findings, producing a report and
producing an action plan where appropriate (e.g. if
deficiencies/problems – see figure 7.2 in handout)
1-24

25. 5. While not a legal requirement in UK, most large companies
and organisations now produce an environment report (e.g.
state of the environment report) based on some form of
audit
6. Welford and Gouldson (1993) claim key benefits include:
 Insurance – premiums often higher if no audit
 Market forces/competition -attitude of consumers to corporate
awareness/concern
 Acquisitions – cost of contaminated land; cost of buying business
with poor environmental record
 Legislation – information may be needed to ensure compliance with
legislative requirements
1-25

26. 7. Also pressures at
intergovernmental
level (e.g. EMAS)
8. Eco-management
and audit scheme
(EMAS) came into
operation in 1995 –
voluntary for See:
companies within EU http://ec.europa.eu/environment/
emas/toolkit/
1-26

27. 9. Basic objective to promote improvements
in environmental performance by
encouraging companies involved in
manufacture waste disposal, mining,
recycling, power generation to:
 Establish and implement environmental
protection schemes
 Comply with legislative requirements
 Carry out regular audits of environmental
performance
1-27

28. 10. System of regular self-
audit with external
verification leading to
accreditation. Kind of
‘benchmark’ to indicate
commitment to high
standard of environmental
performance (i.e.
stakeholder impact)
11. Applicable to both public
and private organisations
(e.g. in UK – ICI, BP and
National Power are
registered under scheme)
1-28

29. 1. Recognition that
products have
impacts on
environment
throughout life
cycle – from
‘cradle to grave’
1-29

30. 7-30

31. 2. LCA is an attempt to identify and evaluate
the total environmental impact of
providing a good/service from beginning to
end (e.g. ultimate disposal)
3. Focuses attention on ongoing impact –
provides opportunity to consider how to
reduce environmental effects (e.g. redesign
of product; marketing of product)
Miles Weaver 1-31

32. 4. May involve change in materials and/or production
processes, marketing, distribution, packing, disposal
methods etc.,
5. In EU ‘Eco-labelling scheme’ based on applications of
LCA – seeks to encourage design, promotion,
marketing and use of products which have a reduced
environmental impact during their life cycle. (other
schemes include German ‘Blue Angel’ scheme – see
Welford and Gouldson (1993) pp. 168 – 174)
6. Can have important marketing benefits
1-32

33. General Motors European Operations
 Supplier
WWP SUPPLIER QUALITY IMPROVEMENT PROCESS assessment
(capability)
n
tio
Addressing Current Quality Problems: GLOBAL SOURCING
lu
so
IMPROVEMENT MEETING
 Quality assurance
Re
-Monitor Supplier Performance Data
QUALITY WORKSHOP
and planning
m
-Prioritize and Focus on Poor Performers
le
ob
-Increase Pressure on Suppliers / Management LEVEL II CONTROLLED SHIPPING
Pr
- Controlled Shipping LEVEL I CONTROLLED SHIPPING  Sample run
- Executive Improvement Process
PR&R (GP-5)
- New Business Hold
PERFORMANCE MONITORING
 Containment
CONTINUOUS IMPROVEMENT (GP-8)
measures for poor
TIME LINE
s
quality
se
EARLY PRODUCTION
LIFE
es
CONTAINMENT (GP-12)
oc
OF PART
RUN @ RATE (GP-9)  Improvement
Pr
Preventing Future Problems:
action
SQ
PRODUCTION PART
APPROVAL (PPAP) -Select Suppliers with Good PPM/ESQES History
(reactionary)
ed
PROTOTYPE SAMPLE -Develop Manufacturable Designs
nc
APPROVAL (GP-11)
-Develop Capable Processes
va
Ad
PRE-PRODUCTION MEETING
- Error-Proof Operations
ADVANCED PRODUCT - Install Process / System Controls  In 2004 …
QUALITY PLANNING (APQP)
-Verify Process Capability prior to SOP Environmental
SOURCING DECISION
impact
POTENTIAL SUPPLIER
ASSESSMENT
START OF assessment of
PRODUCTION supply chain
2 Worldwide Purchasing
operations?
7-33

34. 2003 Enhanced Bidders List (QSTP)  Quality
Creativity Team Bid List
(with enhanced performance metrics)
C  Service
Quality Performance For: ALL
(Creativity Team)
DRAFT PROPOSAL FOR 2003
(Major Function)
 Technology
Data as of: 10-Oct-02
Q S T P
 Price
Commercial Savings
Financial Stress
Math Capability and
Controlled Shipping
Controlled Shipping
Severe Quality
Math Data Quality
QS / TS Cert.
Impact Key measures:
PRR's
SOE - SSR
Readiness

ISO 14001
SPDI
Diversity
PPM
Activity
Level II
NBH
Lead
Q S T P Supplier Location Mfg. Duns
Region
 Quality defect rate
Pro g .
6 M o. 6 M o. 6 M o. 6 M o.
Aug. 02 Launch Mfg-SPWarr. Open6-Mo. APQP PRRs W arrant y
M g mt M f g . 3 M o.
Dec 01
3 M o.
 Containment
G G G G ABC Anytown, IL - 11223344 GME 33 0 0 0 0 0 Y Y N 3 2 G 2 measures
Y G G BCD Sometown, IL - 22334455 NAO 26 0 1 0 1 4 Y Y N 4 1 2 G R
G CDE Notown, OH - 33445566 GME No Data 0 0 0 0 0 Y Y N 0 1  Financial stability
R R G DEF Someplace, 44556677 LAM 5768 0 0 0 0 0 Y Y N 0 R G 1
R G G G EFG Noplace, DE 55667788 NAO 12 1 0 1 0 4 Y Y N 1 1 G 1
 Savings
G Y Y G ABC Anytown, IL - 11223344 GME 0 0 0 0 0 0 Y N N 3 3 G Y 1
R G G BCD Sometown, IL - 22334455 NAO 73529 0 0 0 0 0 Y Y N 1 1 1
CDE Notown, OH - 33445566 GME No Data 0 0 0 0 0 N Y N 0
R R DEF Someplace, 44556677 LAM 146 0 0 2 0 0 Y Y N 1 R Y
 … environmental
Performance Criteria
impact of
G
Y
G
Y
G
Y
<= 277
<= 396
0
1
0
1
Y Y N
W W
0 - 2 1, 2
3
G
Y
G
Y
1, 2 >= 95%
3, 4 50 - 95%
immediate
R R R > 396 >1 >1 N N Y 3 - 5 4, 5 R R 0, 5 < 50%
suppliers?
NOTE: Overall Rank of the supplier is determined by the worst rating (R/Y/G) of the combined Q, S, P rating.
Miles Weaver 7-34

35. "Increasingly, the world around us looks as if we
hated it.“
- Alan Watts
I came to your door as a stranger,
I lived in your house as a guest,
I leave your door as a friend,
My earth
Rabindranath Tagore,
- 1st non-European to be awarded a nobel prize for literature in 1913,
- Bengali poet, novelist, musician, playwright.
1-35

36. READING CONSIDER …
 Roberts, P. (1995)  Research a large organisation
Environmentally Sustainable to understand what
Business: A Local and Regional environmental assessment,
Perspective, London, Paul audits and reviews take place
 What impact have these had?
Chapman Publishing
 Could or should this
organisation do more?
 Welford, R. and Gouldson, A.
(1993) Environmental  Consider a product of your
Management and Business choice, assess how the
Strategy, London, FT producer may reduce its
Management environmental impact?
1-36