ISO 14001:2015 Six fundamental requirements of the Final Draft International Standard
Bringing sustainability and safety to the worlds most complex environments
May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
Contents Click the page name to navigate through the document.
Introduction
3
Background
3
Where can I find out more?
3
1.0
The new requirements for the context of the organisation
4
2.0
Addressing the principals of environmental sustainability
6
3.0
Integrating environmental management into business processes
7
4.0
Approach to risk
8
5.0
The focus on the value chain
9
6.0
Preparing top management and others for the transition
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
INTRODUCTION Background
Where can I find out more?
The substantially-revised ISO 14001:2015 is expected to be published in September, following widespread consultation and the completion of the Final Draft International Standard (FDIS) in late April. The timetable leading up to publication is:
CRA’s Nigel Leehane is one of the UK’s technical experts appointed to the ISO working group revising 14001. Please contact him at nleehane@cra.co.uk if you would like to know more about the changes to ISO 14001 and the implications for your organisation.
May - June
ISO secretariat edit, format and translate the FDIS
July - August
FDIS circulated to ISO members for vote
September
If vote is positive, ISO secretariat make final edits
Late September
ISO 14001:2015 is published
Three years later
ISO 14001:2004 certificates will not be valid
The Institute for Environmental Management and Assessment (IEMA) is inviting its members to participate in the consultation exercise. For details visit the IEMA website www. iema.net or click here www.iema.net/policyiso14001revision. The DIS can be purchased from BSI at http://shop.bsigroup.com/ProductDetail/?p id=000000000030281202, or accessed for review and comment at the following link http:// drafts.bsigroup.com/Home/Details/53336
IEMA STS Making the Transition to ISO 14001:2015 Essential new one-day training course developed by IEMA. This course provides detailed explanation and interpretation of the new requirements in the ISO 14001 Draft International Standard, and encourages individuals to consider the challenges facing them in planning to implement the necessary changes to their systems.
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Click here For dates, locations and more information
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
1.0 THE NEW REQUIREMENTS FOR THE CONTEXT OF THE ORGANISATION An important element of the revision of ISO 14001 is the new clause 4 concerning the “Context of the organisation”. This deals with the strategic consideration of high level issues, which contribute to determining the scope of the EMS. This is a logical step, one that organisations must take in order to develop an effective EMS that focuses on strategicallyimportant environmental issues of relevance to the business. The draft text distinguishes between the general context of the organisation and the needs and expectations of interested parties, or stakeholders. The general context refers to external and internal issues, which can be categorised as: ▪▪ Environmental conditions, including sensitive environments that the organisation could damage, and environmental factors that could impact on the organisation; ▪▪ External context, including cultural, social, political, legal, economic issues; and
▪▪ Internal characteristics, including activities, products and services, but also culture and organisational capabilities. The expectations of interested parties can include regulatory requirements, which are mandatory, and also contractual relationships, customer or investor expectations, trade association standards, community agreements or other expectations. Those which the organisations decides to adopt become compliance obligations, and the EMS must be developed and maintained to ensure conformance with them (see Figure 1). Having an appreciation of context is important in establishing an effective EMS, and many organisations already are considering their external context and stakeholder requirements. Perhaps, not enough attention is given to internal issues, including overall business strategy and business culture and processes. The former may have implications for the scope of the EMS, whereas the latter should determine how the system is designed and implemented.
Figure 1: Context of the Organisation
Consideration of issues - internal and external context and stakeholders
Scoping, development and application of EMS processes
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Wider business strategy
Wider business processes
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
Example of Context – Water Scarcity A multi-national food processing company, with operations in water-stressed regions, has many contextual issues to consider: •
The lack of water may be an operational constraint, reducing output (impact on the business from an environmental condition)
•
Use of water may damage a sensitive habitat or deprive local communities of water (adverse impact on the environment)
•
NGOs are campaigning against the company due to the impacts of its operations, and investors are concerned by this and the reduced revenue resulting from lost production (needs and expectations of interested parties)
•
The company has the technological expertise to use less water in production, but does not have the business culture necessary appreciate that this is an effective solution (internal context)
•
Climate change will result in greater water scarcity, with increased pressure on the organization to take action (changing external environmental conditions).
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ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
2.0 ADDRESSING THE PRINCIPALS OF ENVIRONMENTAL SUSTAINABILITY An important theme of the ISO 14001 revision is the approach taken to environmental sustainability. The 2004 edition of the standard is very much focussed on pollution prevention, with a specific requirement that the environmental policy includes a commitment to this. Although sustainable development and environmental protection are mentioned briefly in the introduction, these terms do not feature subsequently in the standard. The FDIS takes a very different approach. The introduction opens with an explanation of the “three pillars” of sustainability and sustainable development, and states explicitly that the standrad provides a framework for protecting the environment and responding to changing environmental conditions in balance with socioeconomic needs. It goes on to explain that this systematic approach, which takes a lifecycle perspective and recognises the need for sustainable development, provides the basis for “achieving financial and operational benefits that strengthen the organization’s market position”. The FDIS includes a requirement for the organisation’s environmental policy to make a commitment to “the protection of the environment, including prevention of pollution and other[1]...commitments relevant to the context of the organization”. This dramatically broadens the emphasis from pollution prevention, which can be interpreted narrowly as managing hazardous substances, to a fundamentally wider consideration of environmental sustainability. The deliberate
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reference to organisational context implies that the policy should focus the EMS not just on key environmental risks, but also risks and opportunities for the organisation. These can include the consequences of poor environmental management, which may result in additional operating costs, disruption to operations and reputational damage, and also the impacts on the organisation from changing external environmental conditions, including from climate change. The FDIS also emphasises the benefits of determining where in the value chain the organisation can control or influence performance, so that the consequences of environmental aspects can be reduced or mitigated. Again, this is not intended as an onerous imposition on organisations, but rather the objective is to encourage the consideration of external opportunities for improvement, which may result in lower costs from the supply chain or greater marketing opportunities, as a consequence of addressing environmental issues. The intent of the revised standard is to encourage a holistic approach to the management of environmental aspects, with integration into organisational strategy and business processes. The outcome should be one that encourages the adoption of environmentally sustainable practices to deliver sustainable businesses. [1]
These can include “sustainable resource use, climate change mitigation and adaptation, and protection of biodiversity and ecosystems, or other relevant environmental issues”.
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
3.0 INTEGRATING ENVIRONMENTAL MANAGEMENT INTO BUSINESS PROCESSES simple example of this could be:
The ISO Future Challenges study made a number of recommendations for integrating environmental management with mainstream strategic and operational processes. One of these was that currently, ISO 14001 focuses on operational management, and does not encourage strategic consideration of environmental issues (which could be threats or opportunities). This is addressed in the FDIS in a number of areas, including the new requirements for considering organisational context and the needs and expectations of interested parties. The more explicit responsibilities for top management, and the requirement for the management review to provide input for business strategy, also help to elevate environmental sustainability to a strategic level.
▪▪ Context - the organisation is under pressure from customers to reduce costs ▪▪ EMS – environmental aspects, involving resource use and waste, are identified as having cost implications ▪▪ Business processes - design, procurement and engineering functions work together to consider how to modify processes; taking a lifecycle perspective to reduce resource consumption, waste and cost (without compromising any other imperatives, such as producing high quality and desirable products). In establishing its context, the organisation should not just focus on external drivers, but should also consider internal factors such as its own culture, capabilities and strategic direction. The DIS has been developed to encourage organisations to recognise that environmental issues should be managed holistically with all other business risks, internal and external, to deliver the optimum outcome.
Future Challenges also advocated “horizontal integration” with other functions, such as design, procurement and engineering, whose decisions can have significant environmental consequences. This is incorporated into the FDIS, with an explanation in the Annex of the importance of integration as involving those steps shown in Figure 2 below. The management review is now expected to make recommendations for integration if needed, with other business processes.
It must also not be forgotten that ISO is modifying all of its management systems standards to follow a new standard structure and to include common core text. This should further facilitate the management of more than one discipline (environment, health & safety, quality, information security, etc.) by an integrated management system, to deliver efficiencies and improve effectiveness.
The context of the organisation must be considered when establishing the scope of the EMS and planning its development, with environmental issues being managed as necessary by other business processes. A
Figure 2: Horizontal integration
Context
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Business Processes
EMS
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
4.0 APPROACH TO RISK The ISO common structure and core text for management systems standards has introduced a definition for risk and a clause on “risks and opportunities”. It has also introduced a requirement for strategic consideration of “context” and the needs and expectations of interested parties. Together, these new requirements focus attention at both strategic and operational risk. The contextual level focuses on identifying key issues related to what the organisation does, its internal culture and capabilities and the external social, environmental and economic factors. The needs and expectations of interested parties can be adopted by the organisation to become “compliance obligations”, to which it must conform. The clause on risk includes: ▪▪ Identifying environmental aspects and determining if they are significant, based on whether or not they cause a significant environmental impact; ▪▪ Determining compliance obligations, in detail. This includes legal compliance; ▪▪ Establishing a process to determine risks and opportunities; and ▪▪ Planning to take action. The 14001 working group initially modified the core text terminology of “risks and opportunities” to “risk of threats and opportunities”, to align more closely with the approach traditionally
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taken to environmental risk. However, in the FDIS the original texts of ‘risks and opportunities’ was reinstated. The risks in this case are related to the organisation, rather than just the environment (addressed in considering aspects). Here, the focus is on: ▪▪ Risk to the organisation resulting from causing environmental impacts; ▪▪ The risk that the EMS may not be effective; and ▪▪ Risk to the organisation from external environmental conditions. By addressing organisational risk, the FDIS encourages organisations to take a far more pragmatic approach to its interaction with the environment. Taking action to minimise impacts can be justified on the basis of the associated business risks, rather than solely the potential, often indirect, environmental outcomes. This is far more likely to encourage organisations to take action, thereby improving business performance and reducing environmental impact. The FDIS does not specify that determination of environmental aspects and the determination of other risks are two separate processes, so it is for organisations to decide if they address this as a single, or in separate, process(es).
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
5.0 THE FOCUS ON THE VALUE CHAIN Previous drafts of ISO 14001 included a separate sub-clause, 8.2, on the value chain. However, owing to concerns in some quarters regarding the understanding of the terminology, it was agreed to drop the term “value chain”. The lack of a clause title, resulted in the decision being taken to incorporate the text on procurement and design in the operational control clause, 8.1. Although some concerns have been raised that this diverts emphasis away from the value chain concept, there is a sound basis for amalgamating all elements of control in the one clause. There has always been difficulty in satisfactorily explaining the approach to the control and influence of aspects outside the organisational boundary (i.e. elsewhere in the value chain), as opposed to those within it. For example, applying a life-cycle perspective to design (where the design function itself could be outsourced), can minimise the impacts from environmental aspects within the organisational boundary and elsewhere in the value chain. The important concept is that consideration is given to value chain aspects, to identify genuine opportunities where the organisation can exert some form of control or influence. In order to secure support for new initiatives or improvement actions, it is important that a robust business case can demonstrate the resultant benefits to the organisation, for example cost reduction, improvements in product quality or reliability, process efficiency, reputational benefits or improved compliance,
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or other tangible positive outcomes. The degree of confidence in the scale of benefits may depend on the capacity and capability of the organisation itself, or where and how the aspects manifest themselves in the value chain. The potential for exercising control or influence will very much depend on circumstances. For example, it is entirely feasible to use the basis of a contract to control the performance of a contractor who is taking on responsibility for managing an effluent treatment plant on the organisation’s site. There may be far less potential to control or influence those aspects resulting from outsourcing manufacturing to a company in another country. In some cases, the focus should be on controlling the characteristics of the materials or processes involved, whereas in others the objective should be to influence partner organisations to change and improve their own performance and ultimately their culture for managing environmental issues. ISO 14001 requires the application of a lifecycle perspective, not detailed life cycle analysis (although that should not be ruled out). Much can be done simply to: ▪▪ Identify significant environmental aspects throughout the value chain; ▪▪ Determine those that can be controlled or influenced; ▪▪ Develop business cases to explain the benefits of action.
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May 2015
ISO 14001:2015 Six Fundamental Requirements of the Final Draft International Standard back to contents
6.0 Preparing top management and others for the transition The revised ISO 14001 standard incorporates ISO’s new common text that will be applied to all management systems standards, including requirements in a new “Leadership” clause. This applies to “top management”, defined as those directing and controlling an organisation at the highest level[1]. There are numerous new requirements imposing accountability for the performance of the EMS, and these will require top managers to have a greater holistic awareness and understanding of environmental sustainability issues and the role of the EMS in addressing them, both operationally and strategically. They need to: ▪▪ have sufficient knowledge to effectively communicate the importance of environmental performance and continual improvement; ▪▪ be capable of supporting managers and staff in addressing their environmental responsibilities; ▪▪ ensure that resources are made available and that the EMS achieves its intended outcomes; ▪▪ ensure that the environmental policy and objectives are compatible with broader organisational strategy; and ▪▪ ensure the integration of EMS requirements into the organization’s business processes. Some of this responsibility can be delegated, but top management will have to demonstrate an understanding of strategically-important environmental issues and the implications for the business. They will also need to appreciate the implications for middle managers, and the support and encouragement they will need in
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order to deal effectively with environmental issues. They will have to make resources available, and this implies that they will be sufficiently aware of environmental and sustainability issues to prioritise the allocation of resources, in accordance with business needs. In short, the new requirements should push top management into a position of greater involvement in environmental strategy development and decision-making, which in turn should ensure that staff appreciate the importance of taking action. This greater emphasis on responsibility throughout the organisation also means that a far broader range of managers and staff will be called upon to consider seriously environmental performance in relation to their functions, parts of the business or roles. Although the revised standard does not state explicitly that there will be a need for a new approach to competence-building, it is inevitable that organisations will have to upskill if they are to derive the potential business benefits that ISO 14001:2015 encourages. There is nothing new in eco-efficiency, climate change adaptation, eco-design or sustainable supply chains, but too many organisations fail to recognise the opportunities that these elements of environmental management have to offer. The new standard, if properly adopted and applied, should change this. [1] The standard explains that if an EMS applies to only a part of an organisation, a site or a business division, for example, then the clause applies to those directing and controlling that part of the business. This could involve people sitting outside, for example where company directors take financial or other decisions directly related to the part of the business with the EMS, or where it forms part of the portfolio of a manager or director at a higher organisational level.
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