ISO 14001 Advantages and Disadvantages

Over time, the need for the protection of the environment has increased as different industries, companies and institutions have contributed to environmental degradation in different degrees depending on the activities carried out by these organisations. Therefore, as the concept of sustainable development emerged in the late 1980’s, environmental management tools such as Environmental Impact Assessment (EIA), Strategic Environmental Assessment (SEA) and Environmental Management Systems (EMS) have been increasingly utilized to try to reduce the pressure on environmental impacts and resources in a systematic manner.

The British Standard Institute defines environmental management system (EMS) as “the organisational structure, responsibilities, procedures, processes and resources for determining and implementing environmental policy” (in Welford 1998 pg 38). It is also defined as “a set of management process and procedure that allow an organisation to analyse, control and reduce the environmental impacts of its operations and services to achieve cost savings, greater efficiency and oversight and streamlined regulatory compliance”(Schaltegger et al 2003 p 296). In other words, it puts a check on the activities of an organization and its impact the environment and at the same time, improves performance.

There are several kinds of EMS standards but the recognized ones are the BS 7750 British standards, The EMAS which is a European Regulation and the ISO 14001 standard which is voluntary (Sheldon 1997 pg 128). As at December 2005, 111,162 ISO 14001 certificates had been issued in 138 countries to different organisations ranging from heavy manufacturing industries to hotels and local authorities (R.

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DEFRA (2005) defines ISO 14001 as “the international standard for EMS which specifies the features and requirements necessary for organisations systematically identify, evaluate, manage and improve the environmental impacts of their activities, products and services”. ISO 14001 was developed and is managed by the International Organization for Standardization (ISO) which is a non-governmental organisation and is supported by other guidelines which are ISO 14004, 19011 and 14031 but the 14001 series is the only ISO that requires certification (Arimura et al 2008).

DESIGN OF ISO 14001

Sambasivan & Fei (2007) states that ISO 14001 has no legal requirements that it should be adopted but voluntary which is an effective tool for proactive organisations as it acts as a benchmark to improve environmental performance thereby meeting legislation requirements and also reassuring stakeholders and regulators. Sheldon (1997) notes that a key principle for designing ISO 14001 was to reach a consensus with all interested parties on a voluntary basis. Welford (1996 pg 63) states that ISO 14001 is a specification standard that requires the adoption and maintenance of an EMS and has been documented in such a way to ensure conformity can be verified and this can be done through self declaration or by an independent third party certifier. It is designed in such a way that it can be applied to any organisation worldwide and generally provides a framework that a firm can base an EMS and it is voluntary in the sense that any organisation would adopt ISO 14001 only if it’s potential benefits outweighs its cost and competitiveness is not lost as the organisation reduces pollution in the best way they see fit (Delmas 2000, Bansal and Hunter 2003).

Bansal and Hunter (2003) notes that ISO 14001 is the preferred EMS because of its legitimacy and easy recognition by external stakeholders as it is externally certified which requires an audit process to ensure that the EMS meets its set targets. They further added that it has a flexible process that focuses on the processes carried out by the organisation rather than environmental performance.

STRENGTHS

The strength of ISO 14001 as a generic and voluntary standard that can be adopted by all organisations is as follows:

Because it is generic, organisations can adopt it in such a way that is best for the organisation to improve environmental performance and can therefore be built around the organisational culture and structure as Sambasiran & Fei (2007) writes that the true value and benefits of ISO 14001 is gotten when it follows the company’s strategic direction. Organisations have reported financial benefits from adopting ISO 14001 e.g. in the UK, Akzo Nobel chemicals reduced annual consumption of energy by 18% while National Power made £26,000 profit from better waste management (Sheldon 1997). Birds wall ice-cream factory in Gloucester invested £115,000 on certification and started saving £250,000 per year from waste reduction and energy conservation (ENDS 1997).

USB, a large financial institution with branches worldwide, implemented ISO 14001 in the branch in Sweden and stated that it is a useful tool as environmental objectives and operational procedures were integrated into business units and culture therefore producing an efficient EMS for the organisation (Hillary 2000 pg 75).

Because it is voluntary, proactive industries use it to boast business by improved procedures and at the same time environmental performance and meet regulatory requirements. Rondenelli &Vastag (2000) states that the with the voluntary approach, organisations can develop an EMS that is appropriate to activities, location and level of risk which in turn leads to requirements of certification for suppliers and contractors as Ford motors and IBM have done. In their study of Alumax Mt Holly which is an aluminium plant in South Carolina USA and the implementation of ISO 14001 led to improved environmental awareness, enhanced plant reputation, improved recycling and waste reduction and overall, it improved the attitude of staff toward environmental protection and even though it had good environmental practices, ISO 14001 strengthened and improved efficiency of production. ENDS (2006) reports that roll Royce is giving training and support to 6 of its supplier so that they can be ISO 14001 certified

Because it can be adopted by all organisations from large manufacturing industries with 50,000 employees to SME’s with 20 employees in all sectors, heavy industries with high environmental pollution can implement ISO 14001 to meet legislation, reduce environmental impacts and prepare for emergencies in case of accidents. Hotels in Hong Kong like the Grand Stanford Intercontinental Hong Kong and Hotel Nikko are ISO 14001 certified to build positive image, improve environmental performance and for economic benefits (Hillary 2000).

WEAKNESS

The weakness that ISO 14001 is a generic and voluntary standard that can be adopted by all organisations is as follows:

Because it is generic, the organisation and implement ISO 14001 in a way that it sees fit and most organisations get the ISO 14001 certification without changing their organisational culture which is a vital success to the implementation of an EMS as Balzarova et al(2006) looks at a case study of a steel fabrication company who had been certified but lost it because focus was on certification rather than improving environmental performance and employees were not involved in the management process. Re-implementing ISO 14001 the organisational culture had to change and Malmborg (2003) concluded that most organisations do not see an EMS as a tool but a substitute for human actions which leads to problems.

There is difficulty in the interpretation of the organisations environmental aspects as Hilary (2000 pg 44) confirms in her study of local authorities in New Zealand found it difficult to identify indirect effects such as purchasing policy, contractor and supplier management e.t.c.

Because it is voluntary, most organisations adopt ISO 14001 thinking it would “miraculously” improve their environmental system without top management commitment from an early stage.

Researchers have criticised ISO 14001 stating that it does not consider SME’s and developing countries. The cost of implementing ISO 14001 has flawed the fact that it can be adopted by all organizations as the average cost of certification is $10,000-$128,000 and maintenance cost is between $5,000-$10,000 per year depending on the size (Bansal and Hunter 2003). This makes it difficult for SME’s to implement and they contribute about 70% of environmental pollution (Hillary 2000).

CONCLUSION

The design of ISO 14001 has weak sets of direction compared to BS7750 and EMAS because it sets environmental goals and are continuously improved but ISO 14001 does not and this is as a result of businesses in the US scared of potential litigation (ENDS 1997, Streger 2000). Because of lack of resources, and knowledge, the priority of environmental impact is reduced