Environmental concerns change attitudes

Long considered to be at loggerheads, the interests of business and the environment are slowly beginning to converge as industry realises that good environmental practice can also make good business sense.

Increasingly, companies are finding that shifting to cleaner technology and reducing waste can bring both cost savings and a better public image, in addition to a cleaner environment. In some cases, adopting more environmentally friendly practices can even lead to new products and revenue streams.

Nevertheless, the move towards more environmentally friendly practices has been driven by tougher regulatory requirements, higher costs and charges for waste disposal, and concerns about the possible imposition of so-called "green taxes" if business and industry fail to take action.

Among smaller companies, environmental initiatives have generally taken a back seat as owners and managers concentrate on the daily grind of running the business.

"Businesses are slow to do anything until they are either forced to or there's an incentive, either a negative financial incentive such as a tax or charge, or a positive incentive like a grant scheme," says one insider.

IBEC officials are quick to dispute this, pointing to their environmental management training programme for industry, their launch of a new environmental awards scheme for industry and their document on environmental policy for economic growth.

The document affirms the group's commitment to sustainable development, but points out that environmental policies must be balanced by the need of companies to remain competitive.

"Environmental issues are becoming much more important from a business point of view and for IBEC. Companies are asking for advice and information. It's very much on the business agenda," says Ms Mary Kelly, head of IBEC's environmental unit.

Mr Harry Conway, environmental manager with Coates Lorilleux, a manufacturer of printing inks, agrees. "Businesses are beginning to take serious notice of environmental issues now because they have to in order to get their IPC [integrated pollution control] licences. But they are also finding that there are big cost savings."

In 1997-98, Coates took part in a cleaner production pilot demonstration project sponsored by the Environmental Protection Agency and introduced a number of initiatives to help reduce waste.

It replaced its 200-litre nonreturnable ink containers with 1,000-litre drums. It began using plastic liners in its metal pails, enabling the pails to be re-used. And it built a solvent recovery plant on site, so that solvents used in ink production could be recovered and re-used instead of being shipped to England for disposal.

Altogether, Coates has reduced its packaging waste by 74 tonnes and achieved savings of around £68,000 a year.

"The environmental thing just wasn't on the agenda a few years ago. Waste was accepted as part and parcel of the cost of doing business," says Mr Conway. "Now that we've invested, there's benefits not only for us but for our customers too. Their packaging waste is reduced too."

Mallinckrodt Medical Imaging, which manufactures the contrast medium used in medical X-rays, also took part in the EPA project. It implemented new technology which replaced chemical treatment of cooling water with an electronic treatment system, resulting in an overall economic benefit of £10,000 a year to the company.

But the project is only one part of Mallinckrodt's waste minimisation efforts. Last year, it invested $3 million to recover and recycle solvent that would otherwise have ended up as waste.

"We'd invest the money to get a financial return, but there's also an environmental return. We'd expect a payback on those projects in two to three years," says Mr Liam Tolton, site services manager, of Mallinckrodt. The company also recycles all its glass, paper, metal and plastic, he says.

SIFA Ltd, a manufacturer of pharmaceuticals and chemicals, has even managed to turn a waste product into a new revenue stream. Using cleaner production techniques, the company has been able to convert excess acetic acid used in the manufacture of one of its core products into high-grade sodium acetate that can be sold to the dyestuff industry.

As a result, SIFA has reduced the load on its effluent treatment plant by 700 tonnes a year and developed a product with a projected annual turnover of £35,000. "The idea is that clean technology is better for the environment and saves money for companies," says a spokesperson for the Department of the Environment and Local Government.

"We've had some success but it tends to be with the bigger companies, the multinationals whose parents have adhered to these practices elsewhere. The next challenge is to spread the message to smaller companies and get them to take it up."

But a more far-reaching environmental issue is looming, one that will have a huge impact in coming years, not only on business but on agriculture and the public at large - global warming. Under the Kyoto Agreement on climate change signed in 1997, the Republic must limit its emissions of greenhouse gases to 13 per cent above 1990 levels by the period 2008-2012.

Instead, however, emissions have been growing rapidly in line with the growth in the economy, the huge increase in the number of cars on the road and the size of our agricultural sector. The 13 per cent limit is likely to be exceeded this year.

With the Government expected to publish its Greenhouse Gas Abatement Strategy by summer and IBEC already indicating that it will oppose any energy tax, it seems likely that environmental concerns are going to be taking up an increasing amount of managers' time.