In the face of growing stakeholder expectations organizations are increasingly challenged with how to sustainably incorporate environmental management into their operational processes. The recent adjustments to ISO 14001 and 50001 standards are designed to make such integration more straight-forwarded and support genuine change to the way a company manages environmental topics.
In late October 2015, ISO 14001:2015 (Environmental Management) was made publicly available, with a variety of changes to which organizations should adapt. The key change of the new standard is the alignment of the standard to the so-called ‘high-level structure’, meaning that all ISO Management Standards including ISO 9001 (Quality Management), ISO 50001 (Energy Management), and the forthcoming ISO 45001 (Health & Safety Management) have the same basic elements and common terms and definitions.
The main objectives of the revision of ISO 14001 are as follows:
- Implementation of environmental thinking into the organizations strategy and operations
- Enhanced communication of environmental performance
- Strengthening of the continuous improvement process.
Environmental thinking in the new ISO 14001 strives to assess a larger footprint of the organization. While the previous version was mainly focusing on the direct environmental impacts of an organization’s activities, organizations are now required to widen their scope and take the whole life-cycle of a product or service into consideration. Through the revised standard, the accountability for environmental performance is clearly enhanced thus requiring the top management of an organization to be aligned and stand for the requirements of the Environmental Management System. This also means that it is no longer sufficient to provide a statement on pollution prevention – organizations are now required to strive for a positive impact on the environment.
Enhanced internal and external communication is mandatory for the organization. The revised ISO 14001 now requires organizations to collect data about their significant environmental impacts, and be able to communicate its environmental performance internally and also externally to interested parties. This requires transparent data reporting, with credible and reliable data, and a clear communication strategy that defines which information is communicated to whom and when. Here, the environmental management system as such is getting close to mandatory sustainability reporting requirements as set forth in the EU directive 2014/95 on non-financial reporting.
The increased reporting requirements and integration of an organization’s top management clearly underlines the importance of the continuous improvement process. Up to now, this was often seen as something which inherently exists and should operate automatically with the implementation of corrective actions derived from internal audits. Organizations are now forced to think strategically about their future environmental performance and allocate appropriate resources to ensure that this process is on its way to increased sustainability performance.
The new ISO 50001 Energy Management Systems (EnMS) creates a framework for more fundamental energy analyses and the identification of opportunities to reduce energy consumption/raising energy efficiency. Through improved internal communication requirements, process is established to encourage personnel of participating organizations to consider energy consumption and provide suggestions to the organizations management in a concerted manner. The outcome of which is required to be reviewed by the company’s top-level management. The integration will further help to minimize internal costs for implementation and maintenance of the management system as well as external certification costs. The standard echoes key emerging environmental legislation, the directive on energy efficiency which already obliges companies to conduct energy audits within a four-yearly interval. The energy review process according to the ISO 50001 forms a major part of these requirements, as it should be a thorough investigation of a company’s energy use and identification of cost saving potential.
What are the implications for my organization?
Companies now have up to three years to adapt their management system to the new ISO 14001 standard. In 2018, certificates that were issued for Environmental Management Systems according to the old standard ISO 14001:2004 will expire, and new certificates must be issued made according to ISO 14001:2015. Within this timeframe, organizations have to reassess their management system, carefully check for the new requirements and subsequently adapt their processes. Typically, a gap assessment of the EMS is suitable to identify the gaps and develop improvement actions to align to the new standard.
Within the process of revising existing management system to meet the new ISO 14001:2015 requirements, we recommend that organizations verify to what extent other key EHS aspects are covered under the existing management system. One potential implication is the certification of their Energy Management System according to the ISO 50001 standard. Addressing energy consumption, ISO 50001 should be tackled hand-in-hand with any other environmental issue performance monitoring to ensure consistency and avoid duplicative effort.
Energy consumption is typically one of the top five cost drivers for many companies, but often seen and treated as a ‘given cost of business’- expenditure is tracked, however decisions to act to realize potential savings are often made separately from the environmental investment decision-making process. The implementation of the ISO 14001:2015 now gives further impetus to companies that have already implemented energy saving measures as part of their EMS, that was certified against the ‘old’ standards, as external stakeholders are now introduced to the game providing a new disclosure requirement to demonstrate improvements to environmental quality.
In summary, the changes of the updated Environmental Management System standard ISO 14001, together with the requirements of the Energy Management Standard ISO 50001 will help companies to integrate environmental issues deeper in the business operations, supporting identifying cost savings potential and preparing organizations for upcoming reporting requirements.