Climate and Environmental Management Systems Backgrounder
A company’s climate change policy may be incorporated into the larger framework of an environmental management system. Indeed, as managing for climate change becomes more common, standards for doing so may be more easily integrated into overall environmental efforts.
Environmental management systems
An EMS is a set of processes and procedures that a company implements to reduce its environmental impacts and increase its operating efficiency. Key components of EMSs include identifying environmental issues and establishing performance goals, implementing operational changes to meet those goals, and monitoring and evaluating the results of changes. Most EMSs also include mechanisms for continual review and improvement of the EMS itself.
EMSs can range from a collection of informal practices to a set of formally adopted, independently certified policies that a firm may implement as part of its strategic direction. Increasingly, EMSs are being applied across management functions and integrated with business practices and financial performance.
For managers deciding how to tackle climate change, adapting the EMS approach into a method for climate management may be an effective and practical first step. There are many reasons to align corporate climate management strategies with a pre-existing EMS. For example, it may be more efficient to allow environmental managers to address and adapt the specific goals of climate protection in the context of a system they understand. Although accurate carbon accounting requires a detailed level of calculation and verification that may challenge the existing EMS, climate management goals will fit well with any robust EMS that adequately identifies and addresses significant environmental impacts.
Adapting an EMS to address climate management
There are many ways in which an existing EMS might be adapted to address climate change. Here’s one example, illustrated by a diagram (see footnote) based on a common EMS model:
Some companies have already adapted their EMS to manage their climate strategy. For example, the Swiss conglomerate ABB, a diversified company with over USD $20 billion in revenues, has used its existing EMS to continually improve environmental efficiency, including emissions of greenhouse gases. Similarly, IBM’s EMS has incorporated energy use targets since the mid-1980s; more recently these targets have become part of the company’s climate goals (Pew Center, Corporate Greenhouse Gas Reduction Targets, 2001).
ISO 14000 and climate management
The International Organization for Standardization (ISO) is an international non-governmental organization that promotes standardization to facilitate the exchange of products and services around the world. ISO has developed a set of environmental standards, called ISO 14000, which govern environmental management processes, not outcomes. Widely recognized throughout the world, ISO 14000 certification lends added credibility to a company’s EMS.
ISO 14001 is best described as a management standard that requires companies to periodically assess the environmental aspects of their operations and set targets and objectives for continual improvement. As such, it is well-suited to addressing GHG emissions — assuming the company includes climate change impacts within the scope of its EMS. Companies that complete the ISO 14001 certification process, for example, must commit to both compliance with environmental laws and prevention of pollution, and should become well aware of their environmental effects, including their contribution to climate change.
Recognizing the importance of climate change, ISO created Technical Committee 207, Working Group 5, to establish standards for measuring greenhouse gas emissions. These standards are expected to be based at least in part upon the Greenhouse Gas Protocol work of the group of stakeholders headed by the World Resources Institute and World Business Council for Sustainable Development, and also may build on protocol work in California, Australia, and Great Britain. The Working Group is expected to finish its work in 2005.
Looking to the future
Climate management is an involving challenge for companies and should be approached with the awareness that each company is seeking to address a form of pollution (e.g., stack emissions) that is legally permissible when properly permitted. The decision at this time to specifically target and manage the potential global warming effects associated with greenhouse gases entails moving beyond compliance and embarking on a forward-looking level of environmental management. The emergence of international reporting systems points to business advantages for managing climate-related activities as an asset. Mature and verifiable EMSs will likely play an increasingly important role in the inventory and banking aspects of climate management.
