Image Incentives for Environmental Management Essay

Investors argon most perceptibly impressed by environmental worry. A comp some(prenominal) that demonstrates sound and sustain subject practices with respect to the environment wins the self-assurance of fund managers who adopt try management strategies for the long- consideration safety of capital. A line of productions or even an arm of government that has large eyesores in terms of fluff, extravagant consumption and deleterious side- set up from use of its products and goods, go come forth strike it impossible to attract fresh investment, or even to retain its equity, unless it is able to demonstrate clear ability to contain any the undesirable proceedss of its operations.Organizations with transparent environmental management systems leave behind emerge as favorite(a) destinations for public and private investment. Major accidents give the gate threaten the continuance of two industry and government. The equals of the Bhopal disaster on Union Carbides pesticide operations, and that of the atomic major power plant accident in Chernobyl, are striking examples of how a fast disaster base be the reason for an indefinite cessation of every(prenominal) activities for a running organization.Formal environmental management systems help to bastinado off probabilities of unfortunate incidents, to cope with the immediate effects of disasters, and for image recovery in the aftermath of such(prenominal) major incidents. The EMS has therefore image implications for organizations, apart from the factual aid that it would render intern entirelyy. Industries with negative images in the public mind subscribe independent certification of their environmental management systems much than others. The label of ISO send away enable such enterprises prolong their market operations.Some communities may collect polluting and hazardous businesses to move away from them. Local governments do routinely institutionalize severe restrictions on chemical appl ication-some cities in North America project even banned their use altogether. Such developments point towards the eventual expiry of entire sectors of industry. Companies and organizations with long term stakes in such enterprises, can rescue their investments by adopting comprehensive environmental management standards. There are a large number of enterprises and organizations with products, services and activities that have no patent effects on the environment.Even they may on life troll analysis, find areas where they can contribute to conservation of key earth resources. aliveness saving health care services generates large quantities of infectious wastes. electronic goods including computers contain plastics and heavy metals, the disposal of which threatens our future, in a field with such rapid obsolescence. Many consumer goods compete on the basis of elaborate and spellbinding packaging, which tends to be paper based, and therefore very demanding of vegetative cover.Bu reaucracies, especially the build up forces, may run on enormous quantities of energy without consummate and unchanging benefits. Companies in non-polluting fields of endeavor can achieve clean break through with(predicate)s by displaying foresight in environmental conservation terms. Environmental concerns are most attractive for the boylike. This may be because of the long-term perspectives in which link concerns lie. Companies that number and trace products and services for the young, can often find environmental concerns to make special business sense.Many social organizations have large poetry of young people amongst their ranks of activists and fol miserableers, because they lay so much importance by the environment and its conservation. Any business or group activity that seeks the behave and endorsement of the young must have defendable records of environmental management. Toyota leads railway car manufacturers which use achievements in energy and waste reductions, to reach out to the young and to increase their market shares of this demographic segment. Formal environmental management systems strike elaborate procedures.They use the best(p) team building practices. Environmental management methods use some of the top business management resources. The technology encompasses all aspect of business and operations it provides platforms for individual and group excellence. Firms and organizations with elaborate environmental management systems in place can attract and retain the best schoolmaster talent, because of the challenge and opportunity it makes. Conversely, companies and organizations with poor records of environmental conservation will find it increasely difficult to build adequate tender resources of the mighty quality.The reasons and benefits of certified environmental management are non confined to the prosperous reasons of image and goodwill there are concrete business advantages as well. Companies and service organizations that supply goods and services to downstream industries, can access superfluous markets by adopting environmental management systems. The last mentioned have domino effects and all those who adopt formal systems for environment care are largely obliged to make their suppliers conform as well.Vendors who opt to ignore environmental management systems, or who consider the termss to be too high, will find themselves isolated and excluded from increasing sections of their latent markets. Tenders for major construction and service projects may stipulate environmental requirements. Bids can be lost because potential winners for such contracts do not have the experience and resources to comply with entreat conditions. Some bidders, who are not the lowest on price, may present environmental advantages and add-on services to support their bids.We may see more examples of this trend, especially when public funds are at stake. It is unlikely that any major tenders can exclude conditions related to environmental concerns. We know that investors measure stocks more on the bases of their perceptions and sentiments, rather than by the cold facts and figures of financial statements and checks of dividend. video plays a major role in building long term value for companies, especially leaders in mature markets. There is a recent trend towards Corporate Social Responsibility (CSR), which instigates firms to stray beyond the strict limits of their original purposes.CSR has little meaning for firms without EMSs. One can neer tell when an acute and major adverse event may fail an errant company, but the erosion of credibility of all firms with pernicious detestation of the environment, is also certain. There are difficult compulsions for companies to develop and to protect their images in the public eye through the shield of ISO 14001. ISO 14000 and Global Trends The Internet and the initiation Trade Organization have combined to give all businesses worldwide potentia l. This is a double-edged sword, as the benefits come with certain tags.One of the eventful implications of internationalization is the need to display effective commitment to environmental conservation. The latter is a prime concern of recent origin that permeates key markets everyplace (Hanson, A. J. not dated). The United Nations Commission on Environment and Development, also cognise as the Brundtland Commission, published in 1987, gives concrete credence for the inevitability of environmental concerns for all international transactions. The cause of sustainable development is well served by the ISO 14000 series.Business houses and social organizations are bound by some international treaties related to environmental protection. The Montreal Protocol of 1987 on ozone depletion, the Basel conference of 1989 on the deport of hazardous wastes, the 1992 Framework Convention on Climate Change and the 1992 Convention on Biological Diversity, are the key ones. These international agreements act as competitive advantages for companies that can meet the technological challenges implied companies that ignore international trends in environmental concerns, on the other hand, are doomed to exclusion from rising frontiers of world(prenominal) business.The Agreement on Technical business to Trade (TBT) and the write in code of Good Practice are strong albeit indirect influences by the populace Trade Organization to impose environmental management on a trans-national basis. Imports in to a member country may be restricted by technical regulations and product standards. The latter can have strong environment norms, as for example in terms of air emissions. crossroad labeling requirements may also act as barriers for companies to export their goods, if they do not have a comprehensive environmental management system such as ISO 14001 in place.Since ecological labeling is based on life speech rhythm analysis, international trade can dig deep in to proceeds and purchase systems as a barrier to entry for companies that do not follow or use ISO 14001. The Strategic Advisory Group on the Environment (SAGE) has led the ISO to establish the following standards, each of which has severe impact on companies involved in international trade Environmental direction Systems (EMS) Environmental Auditing (EA) Environmental Performance Evaluation (EPE) Life Cycle abbreviation (LCA) Environmental Labeling (EL) Terms and Definitions (T&D) Environmental Aspects of Product Standards (EAPS).TC 207 has the international laterality to set standards for environmental management systems. It has established a network of make committees in many countries of the first world that give strong remains and substance to the strict observance of environmental management standards by all companies engaged in global trade. TC 207 gives an undeniable message to global corporations to use systems such as ISO 14001. Environmental concerns have reached consumer groups, a nd they add large force to regulatory pressures on global companies to use the ISO 14000 series to answer to changing trends in customer demands.Companies that lack the abilities and the inclination to conserve the environment, grimace gradual extinction as they stand to lose custom. The net effect of these treaties and regulations is that business will get confined in stages to small pockets of the trey world where international obligations do not apply, and where consumer awareness is low. Even these pockets will shrink to infinitesimal proportions with the passage of time. The future lies in business that meets global standards, and environmental management systems are an integral part of such standards.ISO 14001 is a structured way for all companies to strengthen their bases for the world-wide markets of the future. ISO 14001 and Profits Many business leaders will not invest the time and money mandatory to obtain ISO 14001 registration, and to maintain it, for image reasons alone. However, they can be persuaded by arguments related to direct effects on the bottom line. ISO 14001 helps profitability in a number of ways (Case Studies 2002). Companies which have implemented ISO 14001 have the following experiences 1. ISO 14001 makes the carrying out of other standards in the ISO 14000 series easier.A company which invests in ISO 14001 can earn multiple returns by qualifying quickly and at low cost, for other certifications in the series. The profit implications of this competence will become an increasing lever of competitive advantage as countries and trading blocks insist on the consumer benefits that the ISO 14000 series offers. 2. Material and energy costs can be hearty in total product costs. Much of the ISO 14001 unconscious process deals with reducing the summate of materials and energies needed to make each unit of a brand. This leads to direct cost savings.ISO 14001 also reduces the total cost of output by reducing waste management expenses. 3. ISO 14001 reduces the chances that a company may have to pay out large and unexpected amounts to help communities recover from pollution arising out of production and use of products. ISO 14001 protects operating profits from erosion due to recovery from pollution. 4. recycle of waste is an important ISO 14001 priority. Parts recovered from a recycle process can act as raw materials for a new or a different production process, sometimes by a new entity at some other location.Regardless of the structure of a recycling process, there are always significant revenue potentials in the system. 5. ISO 14001 contributes positively to employee health and safety. It reduces employee-related costs in this manner, and improves productivity. ISO 14001 companies can expect better contributions from their human resources. 6. Insurance companies can be persuaded to reduce their charges as ISO 14001 improves risk management. The chances of adverse events reduce with ISO 14001 processes, and ther eby reduce insurance costs. 7. ISO 14001 has international relevance.Companies that operate globally can avoid duplicating the costs of meeting local standards by pursuance the universal nature of ISO 14001 certification. 8. Company valuation appreciates after an ISO 14001 certification, especially for comparatively risky areas of business. Investors feel more assured about investing in stocks of companies that are able to manage their inherent risks in the transparent and professional ways of ISO 14001. 9. Companies can market their ISO 14001 certifications to gain market share. Customers may switch over to support companies who are able to inform them about the environmental benefits of the registration.ISO 14001 is a flexible system that adapts to the priorities of organizations that strive for its certification. It yields margin improvement through productivity achievements. It also protects future profits by contributing to the risk management capabilities of registered organi zations. It can reduce insurance costs by managing product liabilities and reducing the probabilities of accidents, claims and other adverse incidents. Companies that use ISO 14001 experience profit product and more assured future prospects as well.