Building Sustainable Value Chains Through LCM-CMM and Action Learning

UNEP/SETAC Life-Cycle Initiative Life Cycle Management Capability Maturity Model (LCM-CMM) Building Capacity for Sustainable Value Chains International Life Cycle Partnership To bring science-based life cycle approaches into practice worldwide

QUICK TOUR OF LCM CMM CONTINUAL LEARNING

LCM- CMM APPROACH (WHAT TO DO) Competitive Context SWOT Analysis O T Improvement Plan Near term business objectives Long term org. development Situation Analysis S W Maturity Assessment Product Life Cycle Scan Action Learning Speed implementation Just enough analysis + just in time training (HOW TO DO)

CYCLES OF LEARNING Management Commitment Communicate vision and provide necessary resources Identify improvement priorities Set quantified targets Plan Identify key gaps to be addressed in next cycle Linked to business strategy Integrated into organizational routines Act Do Embed new practices in management system Action learning Defined processes Roles & responsibilities Training & development Learn Assess performance against targets Capture lessons learned

ACTION LEARNING Directed by business manager Supported by LCM champion Training/ technical consultant Active learning Feedback from work outcome Accelerated implementation Situation Analysis SWOT Analysis Improvement Project ACTIONABLE TASKS

QUALIFIED Do No Harm Management Commitment Basic procedures to protect people and the environment Quantify outputs Set Targets Plan Identify key measurement gaps to define business case Act Risk avoidance Legal compliance License to operate Do Roles & responsibilities Employee training Accountability Hazard ID Controls, procedures Emergency planning Inspections Corrective action Root cause Learn

QUALIFIED Key capabilities Environmental awareness, hazard identification, root cause analysis, numerical literacy Business impacts Legal compliance, license to operate, risk/ cost avoidance LCA Methodology Data quality, process mapping (gate- to- gate) EMS Elements Legal & regulatory requirements, environmental aspects, roles & responsibilities, operating controls, training, inspections, emergency response, incident investigation & corrective action

QUALIFIED Key Activities Inventory key waste streams and most frequent accidents. Establish baseline performance measures and set targets for improvement. Inventory toxic chemical uses. PLAN Conduct job hazard assessments & install procedures and controls to manage hazards. Characterize all waste streams. Implement procedures to ensure compliance activities are conducted as required. Implement inspections to reinforce required safety and environmental actions. Assess for potential incidents & identify necessary actions for response and containment DO Conduct emergency response drill. Review inspection findings and implement corrective action. Establish incident investigation process to drive to root cause. Conduct independent 3rd party compliance audit. LEARN Establish emergency response plan. Establish employee awareness training program, including new employee orientation. Formalize operational controls and management systems for ongoing safety and environmental compliance Implement corrective action to address any findings from third- party compliance audit. Publicly report compliance with legal and regulatory requirements & progress toward improvement goals. Identify key information needs to drive next cycle of improvement ACT

EFFICIENT Management Commitment Upgrade procedures to reduce impacts to lowest economically feasible level Plan Identify performance gaps that require redesign/ innovation Aspects & impacts Energy & water use Chemical inventory Act Process efficiency Improve operating margins Eliminate waste Do Organization Accountability Public reporting Risk assessment Environmental costs Pollution prevention Process safety Learn Management system audit Track KPIs against targets

EFFICIENT Key capabilities Risk assessment, financial literacy & environmental accounting, quality improvement tools (e.g. statistical process control), cross- functional collaboration Business impacts Process efficiency/ operational excellence, improved margins, reduced inventory & working capital LCA Methodology Life cycle inventory, product system modeling (cradle- to- gate; gate- to- grave; attributional), impact assessment EMS Elements Policy, environmental impacts, objectives & targets, organization & accountability, programs, management audits, external reporting (environmental)

EFFICIENT Key Activities Identify environmental & safety aspects and impacts of facility operations. Inventory energy uses. Compile a water balance for facility. Establish baseline performance and set targets for improvement PLAN Conduct a risk assessment of facility aspects and impacts & set priorities for improvement. Conduct pollution prevention/waste minimization projects as required to meet goals. Develop environmental accounting system to quantify costs of pollution and injuries. Conduct alternatives assessment for all uses of toxic chemicals DO Conduct management system audit of inspection process in reducing incidents. Define and monitor key performance indicators (KPIs) to assess progress toward targets. Review effectiveness of EH&S programs. Review adequacy of information system for supporting environmental accounting. LEARN Draft policy and formalize environment, health and safety programs. Standardize measurements & establish quality assurance procedures. Integrate measurement requirements into information technology strategic planning. Integrate EH&S requirements into employee development programs. Define plan for substitution of toxic chemical uses with safer alternatives. Establish communication plan for public reporting of company performance ACT

EFFECTIVE Create goods & services that improve human condition while continually reducing impacts and resource rqmts Management Commitment Plan Identify key policy barriers to sustainable business Value chain impacts Scope 1 & 2 GHG Water footprint Materiality matrix Act Top line growth New markets Innovative products Do Sustainability reporting e.g. GRI (partial) GHG/ water footprint/ eco- labels LCA Design for environment Chemical substitution Learn Annual program review Stakeholder feedback

EFFECTIVE Key capabilities Robust & user- centered design principles, systems thinking, multi- attribute decision- making, conflict resolution, inter- organizational collaboration Business impacts Product & business model innovation, new markets & expansion of existing markets LCA Methodology Interpretation & communication, cradle- to- grave modeling (consequential, scenarios), critical review EMS Elements Annual management review, design for environment, supplier environmental management, stakeholder engagement, external reporting (CSR)

EFFECTIVE Key Activities Identify environmental & safety aspects and impacts of company s value chain. Compile scope 1 & 2 GHG inventory for company. Estimate water footprint. Develop preliminary materiality matrix of stakeholder issues. Establish baseline performance and set targets for improvement. PLAN Conduct streamlined LCA for key product family. Use results to upgrade design manuals or implement eco- design idea(s) in new product development. Conduct design for environment pilot on product with key customer designed to enhance customer value proposition with superior environmental performance. Conduct process improvement project with strategic supplier(s). Complete project to substitute a toxic chemical use with a safer alternative. DO Conduct management review of LCM programs. Engage stakeholders to review company progress and assess their understanding/ acceptance of KPIs used to communicate progress Assess progress against toxic used reduction plan. LEARN Update policy and extend environmental programs to cover full product life cycle system. Upgrade communication plan to ensure product marketing and public reporting aligned. Develop formal stakeholder engagement plan to inform strategic planning. Bring public reporting into compliance with GRI guidelines. ACT

ADAPTIVE Management Commitment Transform business model to support sustainable consumption & production Plan Co- create new markets for enhanced well- being! Socio- economic profile Stakeholder engagement Act Balance sheet focus Capital preservation Sustainable prosperity Do Sustainability mgmt. system Public policy reform System innovation Public- private partnerships Stakeholder review of performance Learn

SUSTAINABLE CONSUMPTION & PRODUCTION WBCSD. (2010). Vision 2050: The new agenda for business http://www.wbcsd.org/WEB/PROJECTS/BZROLE/VISION2050-FULLREPORT_FINAL.PDF