Title: Corporations and Sustainability
1Corporations and Sustainability
2Overview
- The Case for Sustainability in Manufacturing
- Terminology
- Natural Systems as Models
- Directions in Industrial Ecology
- Examples
3Political Importance of Sustainability
SustainableProduction Consumption
Compulsory CO2-reduction Goals (Kyoto)
Agenda 21 Biodiversity
Oil Crisis
Brundtland UN-Report
Political Relevance of Sustainability
Ecological Tax reforms
Country Strategies Sustainability
RIO SustainabilitySummit
1970
2000
1980
1990
4Economic importance of sustainability
Shell 20 renewable energy by 2020
Shell Compulsory Sustainability-Goals
Dow Jones Global Sustainability Index
Unilever Sustainable Fishing
Daimler-Benz Fuel Cells not later than 2004
Chemical industry Environmental reports
Economic Relevance of Sustainability
Banks/Insurance UNEP-Declaration
Industry EMAS ISO 14000
Swiss Re Sustainable Performance Group
1970
2000
1980
1990
5Dow Jones Sustainability Index
- DJSGI / DJGI (Euro)
- Correlation 0.9617 Tracking Error 3.08
- DJSGI Volatility 16.80 DJGI Volatility 16.11
6Investment performance
- "Most of these companies will fluctuate with the
market," Zehnder said. "But the larger ones don't
fall as hard. The smaller sustainable companies
have a little more volatility -- they may be hit
harder in a downturn, but they come back at a
stronger rate, as well." - Zehnder may have a point. In recent days, when
the Dow Jones Industrial Average has taken a
dive, the sustainability index has made modest
gains of 2 or 3 percent -- although it's about 14
percent lower than last year at this time. - Gainesville Sun, Thursday, March 22, 2001
7Candidates for Lessening Impacts
- Zero Emissions Systems
- Orderly progression from Type I (high throughput
mass and energy, no resource recovery) to Type
III (closed loop) - Eliminate leaks
- Material Substitution
- More durable, less waste, more recyclable
- Dematerialization
- Theory of Dematerialization the more affluent a
society becomes, the mass of materials required
diminishes over time - Must result in less waste to be effective
- Functionality Economy
- What is the function? Do we need automobiles?
Waste from telephone disposal (old phones were
leased and returned!)
8Terminology
- Ecology the study of the earths life support
systems, of the interdependence of all beings on
Earth (Odum, E.) - Metabolism sum of the processes sustaining the
organism production of new cellular materials
(anabolism) and degradation of other materials to
produce energy (catabolism) (Ray) - Industrial Ecology application of ecological
theory to industrial systems (Rejeski) views the
industrial world as a natural system, embedded in
local ecosystems and the local biosphere (Lowe) - Industrial Metabolism flow of materials energy
through the industrial system and the interaction
of these flows with global biogeochemical cycles
(Erkman) - Industrial Symbiosis an industrial system where
waste from processes is a resources for other
processes
9More Terminology
- Design for the Environment considers all
potential environmental implications of a
product energy and materials used in the
product its manufacture and packaging
transportation consumer use, reuse, and
recycling and disposal. - Design for Recycling
- Design for Disassembly
- Design for Remanufacturing
10Design for the Environment (DFE)
- Considers all potential implications of a product
- Energy materials
- Manufacture packaging
- Transportation
- Consumer use, reuse or recycling, and disposal
- A holistic design process
- Example automobile bodies (Iron, plastics,
aluminum) - Tradeoffs virgin vs. recycled, energy at each
stage, materials recyclability,
manufacturability, costs - Challenges
- Adequate database about materials and their
impacts - Concurrent engineering to work across RD,
marketing, quality.. - Public sector involvement for defining values for
trade-off
11DFE Example - Xerox
New Components
Raw Materials
Certified Reprocessing
Certified Reprocessing
Deliver
Closed Loop Recycling
Return to Suppliers
Customer Use
Sort/Inspect
Third Party Recycling
Remove
Materials for Recycling
Dismantle
Alternative Uses
Disposal Goal Zero to Landfill
12More Terminology
- Eco-Efficiency Integration of economic
efficiency (financial return, profit,
productivity, customer perception) and
environmental efficiency (energy, emissions,
environmental impacts. - Ecofactory integrated design of production
systems technology- including DFE at product and
process levels with disassembling, reuse and
materials recycling technology (Agency for
Industrial Science and Technology, Japan)
13Natural Systems
- Function as an integrated whole
- Minimize waste dead or alive all plants and
animals and their wastes are food for something - Decomposers (microbes and other organisms)
consume waste and are eaten by other creatures in
the food chain - Toxins are not stored or transported in bulk but
are synthesized and used as need by species
individuals - Materials are continually circulated and
transformed in elegant ways. - Nature runs largely off solar energy
- Nature is dynamic and information driven,
identity of ecosystem players is defined in
process terms
14The Deep Ecology Paradigm
- Earth is a closed system
- Human society and ecosystems have co-evolved
- Nature has value and an independent right to
exist - Natures intrinsic value is hidden by economic
activity - Sustainability is the wrong question as it comes
out of human-centeredness - Human transformation of self to realize harmony
with nature - Technological pessimism the value of
technological innovation must be proven - Level of economic activity ultimately consistent
with solar inputs
15Industrial Ecology
- The name industrial ecology- why?
- Models of non-human biological systems and their
interactions with nature are instructive for
industrial systems that we design and operate - The biological model is clever, a closed-loop
materials system - Recent better understanding of the materials and
energy flows of biological systems - Questions
- How do you apply the biological principles of
resilience, limiting factors, other rules? - What about the low efficiency of natural systems
( - Bottom Line
- Lessen (dramatically the impacts of our
industrial system) - Management of the industry-natural systems
interface, match input-output of the manmade
world to the constraints of the biosphere
16Industrial Metabolism
- A Big Picture analytic tool developed by Robert
Ayres - Examination of the total pattern of material and
energy flows form initial extraction of resources
to final disposal of wastes - Factors in the real value of nonrenewable
resources and environmental pollution, gives
value to externalities - Can be used for regions (the Rhine basin),
specific industries (aluminum) or specific
materials (heavy metals) - Suggests some measures of sustainability ratios
of potential to actual recycled materials, virgin
to recycled materials, materials productivity
17Industrial Symbiosis
- Most commonly understood meaning of industrial
ecology - Waste materials and energy serving as inputs or
resources for other industrial processes - Also referred to as By-product synergy, green
twinning, zero-waste/zero-emissions,
cradle-to-cradle eco-efficient manufacturing - Evolving into the concept of an Eco-Industrial
Park where co-locating
18Conventional Waste Managment in Fiji
Brewery waste dumped into oceans to destroy coral
reefs
Brewery
Muck dumped on fields
Waste piles up
Methane vented
Muck cleaned out
19Industrial Ecology in Fiji
Brewery waste fertilizes mushrooms
Brewery
Mushroom residue feeds chickens
Chicken waste is composted
Solids become fish food
Nutrients used in gardens
20Industrial Ecosystem Kalundborg
Heat
Water
Gas
Heat
Steam
Water
Water
Gypsum
Steam
Water
Heat
Sludge
Fly Ash
21Implementing Industrial Ecology
- Technical Basis
- Choose material
- Design the product
- Recover the material
- Monitor the Situation
- Institutional Barriers and Incentives
- Market and informational barriers
- Business and Financial barriers
- Regulatory barriers
- Legal Barriers
- Regional Strategies
- Ecoparks, Eco-Factories
22The Eco-Industrial Park (EIP)
- A community of manufacturing and service
businesses seeking enhanced environmental and
economic performance through collaborating in the
management of environmental and resource issues. - The interactions among companies resemble the
dynamics of a natural ecosystem where all
materials are continually recycled. - Industrial Park restricted meaning in terms of
geography and ownership. - An EIP is a relate estate property that must be
managed to bring a competitive advantage to its
owners. - An EIP is a community of companies that must
manage itself to provide benefits for its
members. - Decisions are based on maximizing the
profitability of the EIP as a whole - Transfer prices negotiated so each member will be
as profitable as without the EIP
23Some Case Studies of Businesses
- Victoria Versicherungs-Gesellschaften
- Monsanto
- Xerox
- Interface
- Ford Motor Company
24Victoria Versicherungs-Gesellschaften
- Certified to European Union (EU) Environmental
Management and Audit Scheme (EMAS) in 1999 - EMAS designed for manufacturing firms but there
are many indirect impacts of financial
institutions - Victoria has extensive real-estate holdings (184)
buildings location, energy-consumption - Internal operations energy, water, solid waste,
consumption of office supplies, restricted air
transport (most air emissions due to business
travel) - Rewards environmentally-friendly behavior in
insurance coverage, premium calculations, claims
adjustment, etc. - Compensates clients for replanting trees and
shrubs in residential construction - New guidelines for calculating premiums for
liability at wastewater treatment plants for
reduced chemical use. - EMS is a license to participate in developing new
tools and markets
25Interface, Inc.
- A manufacturer of carpet tiles and carpeting
- 6,300 people, 110 countries, 26 plants
- Want to become the worlds first truly
sustainable company 400 sustainability
initiatives - The basic questions
- What do we take?
- What do we make?
- What do we waste?
26The Path to Sustainability
- Eliminate Waste
- Benign Emissions
- Renewable Energy
- Closing the Loop
- Resource Efficient Transportation
- Sensitivity Hookup
- Redesign of Commerce
27The Prototypical Company of the 21st Century
28Xerox
- Waste Free Products from Waste Free Plants for
Waste Free Offices philosophy. - Definition of Xerox equipment "Xerox equipment
and accessories have been produced in a factory
from new parts and reprocessed parts, which meet
the performance standard of new parts. - The company uses eco-efficiency to enable it to
satisfy customers requirements for environmental
and functional benefits, while at the same time
improving its own operational efficiency while
deriving economic benefit. This is done through
waste free products, waste free plants and waste
free offices. - Packaging free products is major goal
29Xerox-Ecoefficiency Strategy
Xerox has shown that eco-efficiency can provide
win-win-win situations 1. win for the customer
(increased savings by increased efficiency, and
lowering the environmental impact) 2. win for
the company (avoiding raw material purchases, and
increased customer satisfaction) 3. win for the
environment (reduced raw material consumption)
30Xerox Waste Free Products
1. reduced material mix resulting in easier
separation of materials for recycling 2. parts
commonality enabling the reusing of parts 3.
multiple lives avoids disposal of useful parts
and optimized part life 4. serviceability
digital machines utilize sixth sense
diagnostics, which allow remote servicing and
eliminating broken calls whilst minimizing
service engineer journeys 5. easy disassembly
products designed for disassembly allowing
reuse/recycling 6. packaging-free reusable or
recyclable pallets eliminate the need for
traditional waste producing packaging
317. life cycle analysis used in the design
process to evaluate environmental impacts 8.
life cycle costing costing throughout all
phases of the life cycle 9. customer requirements
delivering products which include customers
requirements into the design process 10.
materials recycling as much material as
possible is reprocessed or recycled, reducing
resource consumption and providing an economic
return through the purchasing of fewer raw
materials 11. document productivity by making
document management more efficient, Xerox is both
satisfying its customers with higher flexibility
and functionality while reducing material
consumption.
32Xerox-Zero Waste Plants
33Xerox-Waste Free Offices
- Waste in an office is a sign of inefficiency
- Reclaim toner bottles and cartridges
- Printing on both sides of a sheet of paper
34 35(No Transcript)
36Monsantos Product Sustainability Process
37Ford Motor Company
- A typical U.S. car weighs 3,274 pounds with the
industry consuming - 76 percent of all natural rubber
- 33 percent of iron
- 31 percent of aluminum
- Ford has developed and offered Design-for-Environm
ent training to all engineers and suppliers to
help them understand issues, tradeoffs and the
state-of-the-art with respect to recycled content
and other desirable materials. - Cross-functional Vehicle Recycling Action Teams
in North America and Europe are charged with the
task of increasing the use of recycled content,
non-metallic materials and "design for recycling"
in an effort to achieve environmental targets. - Ford was the first automotive company to issue
worldwide recycling guidelines to its suppliers
and engineers
38Ford (continued)
- These efforts have borne fruit, with Ford's
recent models such as the Taurus, Fiesta and
Excursion ranging from 80 percent to 84 percent
recyclable. - Ford itself has entered the recycling business
through the purchase of more than 25 automotive
recycling companies. - Ford is an active participant in the
International Dismantling Information System
(IDIS), a consortium formed in 1995 and expanded
in 1999 to include all 20 major automotive
manufacturers worldwide. - The purpose of IDIS is to provide dismantlers
with needed information on environmentally sound
treatment of end-of-life vehicles. - IDIS has developed a single, user-friendly
database of information on vehicles dating back
to the early 1980s, listing any parts that are
worth recycling and detailing procedures for
fluid removal, air bag treatment and dismantling.
39Program in Sustainable Manufacturing (PRISM)
- Leading edge of courses offered at universities
- Michigan Tech
- A student-led, manufacturing learning enterprise.
40Summary and Conclusions
- Manufacturing, like other sectors, must deal with
sustainability - Industrial Ecology and Metabolism provide a
possible framework for creating a shift - Leading businesses around the world are beginning
to examine how to shift their practices to
accommodate zero emissions, closed loop behavior,
mimicking of nature, into their businesses - Sustainable manufacturing can make the US more
competitive globally