ISO 14000 Green Accounting
Standards, Practices, and Cases
David M. Boje
October 23, 1999
What is ISO 14000?
ISO is International Trans-Organization
for Standardization (press here for ISO).
ISO is a network of organizations across over 30 countries that set of
standards and requirements that allow an organization to seek certification
for ISO 9000 or ISO 14000. Some 10,000 organizations are certified globally,
but few in the U.S. seek certification. ISO 9000 provides a framework
for quality management and quality assurance is more popular in the U.S..
The ISO 14000 series of stnadards provides a framework for environmental
management that is being widely adopted by Japan, several European nations,
but less so by the U.S.
ISO 14000 is a series of process standards:
a family of voluntary environmental management standards and guidelines.
It strives to establish an organizational environmental ethic and enhance
an organization's ability to attain and measure environmental performance
The ISO recently released a draft of standards
that address environmental issues, the ISO 14000 series. The standards
seek to harmonize practices in environmental management, auditing, performance
evaluation, labeling, and life-cycle analysis (press
ISO is a Transorganizational network is
headquartered in Geneva, Switzerland, with member nation-state offices
in some 30 plus countries. For example, the U.S. office is USA (ANSI):
American National Standards Institute
Trnasorganization Network - Member
organzitions of the ISO transorganizational network are entitled to participate
and exercise full voting rights on any technical committee and policy committee
of ISO. There is tiered membership. For example, there are members with
full voting rights, and a correspondent member is an organization in a
country that does not yet have a fully developed national standards activity.
ISO has also established a third category, subscriber membership, for
countries with very small economies. Subscriber members pay reduced membership
fees that nevertheless allow them to maintain contact with international
standardization. ISO is building a strategic partnership with the World
Trade Organization (WTO) with the common goal of promoting a free and fair
global trading system.
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Transorganizational Structure of ISO
Network - The technical work of ISO is highly decentralized, carried
out in a hierarchy of some 2 850 technical committees, subcommittees and
working groups. 30,000 ISO experts participate in meetings each year.
Meetings of technical committees and subcommittees are convened by
the Central Secretariat, which coordinates all such meetings with the committee
secretariats before setting the date and place. Although the greater part
of the ISO technical work is done by correspondence, there are, on average,
a dozen ISO meetings taking place somewhere in the world every working
day of the year.
Certification verifies that an organization
and its management has the systems in place required of ISO14000. This
is taken as evidence by customers, investors, suppliers, and regulators
that a company is making a good faith effort to be and environmental steward
and obey applicable environmental laws. ISO 14000 is a family of environmental
standards. The others being developed are:
ISO 14001 - Specification of Environmental
Management Systems - In September 1996, the ISO standard 14001 for Environmental
Management Systems (EMS) was finalized. (FAQ
ISO 14004 - Guidelines for ISO 14001
ISO 14010 thru ISO 14012 - Environmental Auditing
and related activities
ISO 14031 - Environmental Performance Evaluation
How does ISO 14000 differ from other standards? (source,
ISO 14000, the European Eco-Management
and Audit Scheme (EMAS), and British Standard 7750 (BS 7750) are all standards
for implementing environmental management systems. BS 7750, developed by
the British Standards Institution, was the world's first standard for environmental
management systems (EMS). The International Organization for Standardization
has developed the ISO 14000 series, which superseded BS 7750 as of March
1997 *. The ISO 14000 series are international voluntary standards that
were modeled after BS 7750. EMAS was developed for the European Union
and is also based on BS 7750. Thus all of the standards share the same
foundation... EMAS is the most stringent of the three standards. Germany
played a key role in developing EMAS, and their high environmental standards
are reflected in the additional requirements.
Global environmental management standards
allow organizations to incorporate their environmental efforts towards
a common goal - sustainable development. However, this goal is being accomplished
with different results by Functionalist and Green Environmental Accounting
(EA) approaches to ISO14000 certification and monitoring.
EMAS and ISO 14000 comparison This site
provides a detailed comparison among the existing EMS standards. The information
on the site is provided by the ISO 9000/QS-9000 Support Group (press
In functionalist accounting,
the traditional motivator for implementing
environmental accounting (EA) was Traditionally, the to avoid the costs
of regualatory enforcement or to create the public image of environmental
behavior to attract customers and investors with surrogate behaviors. However,
recently some of the functionalist accounting firms are attempting to convince
companies that costs can be lowered in material waste and selling off reclaimed
materials. There are a growing number of countries and states within the
U.S. that require environmental reports as part of the annual financial
report to investors. Functionalist Accounting specialists list these types
of benefits of ISO14000:
Benefits are many, including:
The Green EA movement is
aimed at broader issues, such as implementing sustainable business practice
in order to conserve natural resources for future generations. Consumers
and investors are also boycotting companies that engage in no Green practices
and stage Greenwash campaigns that make them appear Green when they are
not. Increasingly environmentally responsible companies are implementing
environmental audits as part of their attempts to adopt ISO14000 standandards
Reduced noncompliance, fines; e.g. Taking
your list of
environmental regulations you follow,
evaluate each for its costs and potential risks from
Intregation of environmental issues into other
management systems, bring cost savings;
Market advantage by demonstrating commitment
to environmental management via independent certification.e.g. "Registering
your company as complying with an international standard on the environment
means a huge marketing advantage. Customers like to see this, investors
like it, and the local community likes it too."
Other Frequently Asked Questions (FAQ - Press
Here). For Example:
Typical of Green EA is "Over the years we
have heard of numerous issues concerning global warming, the green house
effects, ozone depletion, excessive of burning of fossil fuels and major
recycling programs. These are all efforts to preserve our environment.
Or, Organisations of all kinds are increasingly
concerned about achievingand demonstrating sound environmental performance
by controlling impact of their activities, products and services on the
To improve the management of our resources
To save and recycle energy and improve process
Generally eliminate waste
Improve our relations with and understanding
of our community.
How are Standards Developed?
Who developed the ISO 14000 standards?
International Organization for Standardization
(ISO) Technical Committee (TC) 207. The scope of TC 207 is standardization
in the field of environmental management tools and systems. The standards
apply to environmental management tools and systems; they are not
product standards, nor do they specify performance or pollutant/effluent
levels. Specifically excluded are:
Test methods for pollutants.
What is covered by ISO 14000?
Setting limit values regarding pollutants
Setting environmental performance levels.
Standardization of products.
TC 207 cooperates closely with ISO TC
176 on Quality Management (developers of ISO 9000) in the field of environmental
management systemsand audits.
ISO standards are developed according
to the following principles:
The views of all interests are taken
into account: manufacturers, vendors and users, consumer groups, testing
laboratories, governments, engineering professions and research organizations.
Industry-wide Global solutions to satisfy industries and customers worldwide.
International standardization is market-driven
and therefore based on voluntary involvement of all interests in the market-place.
How it all started? According to ISO-Switerland,
standardization began in the electrotechnical field: the
Electrotechnical Commission (IEC) was created in 1906.
in other fields was carried out by the International
the National Standardizing Associations (ISA), which was
set up in 1926.
The emphasis within ISA was laid heavily on mechanical
ceased in 1942, owing to the Second World War.
Following a meeting
in London in 1946, delegates from 25 countries
decided to create
a new international organization "the object of which
would be to facilitate
the international coordination and unification of
The new organization, ISO, began to function
23 February 1947.
There are six phases in developing standards
Stage 1: Proposal
Stage 2: Preparatory
Stage 3: Committee
Stage 4: Enquiry
Stage 5: Approval
Stage 6: Publication
There are major international differences
in the implementation rate of ISO 14000/1 standards. For example, by
the end of 1996 there were 1,491 ISO certificates issued globally. According
to the International Environmental Systems Update (IESU) the United States
had four sites certified to ISO 14001 at the end of 1996. According to
the survey, at the end of 1997 the United States had 83 sites certified
compared to a worldwide total of 5017. September 1998, IESU reported that
the United States had 188 site certifications and 5,446 certifications
worldwide. The ISO World web site reported that there were 450 sites certified
in the United States as of April 1999 and 9,700 worldwide certifications
(press here for source).
WHAT IS EMS? Environmental Management
More - "The ISO World Wide Web site reported
that in April 1999 that approximately
67 countries have companies that
have achieved ISO 14001 certification. Of
these countries, Japan has 2,043
companies certified to ISO 14001, Germany
with 1,300, the UK with 800, Sweden
with 520 and Korea with 463. The
United States follows Korea with
450 ISO certifications for April 1999. More
than half the countries reported
in this April 1999 update have 100 or fewer
companies certified to ISO 14001.
An EMS is defined by Gilbert (1993:19)
as " … the means to control and improve the environmental performance of
the business. It is the mechanism to ensure that you have in place the
necessary controls to understand the environmental performance against
that requirement; to identify what areas for improvement planning exist;
and implement the improvement plan through controlling and tracking your
critical activities to achieve the desired results." (Source press
What is a GAP Analysis?
The Environmental Management System (EMS)
document is the central document that describes the interaction of the
core elements of the system, and provides a third-party auditor with the
key information necessary to understand the environmental management systems
in-place at the company. Consistent with the principles of ISO14001, the
Environmental Policy and Environmental Aspects/impacts analysis, including
legal & other requirements, shape the program by influencing the selection
of specific measurable environmental goals, objectives, & targets.
Specific programs and/or projects must then be developed to achieve these
environmental goals, objectives, & targets (in ISO14001 terms, this
would be referred to as "Implementation & Operation"). The checking
& corrective action elements of the system help ensure continuous improvement
by addressing root causes on non-conformances. The ongoing management review
of the EMS and its elements helps to ensure continuing suitability, adequacy,
& effectiveness of the program (source
Mini Gap Analysis is a computer form you
can fill out and score on line to get a sense of GAP Analaysis (press
14000 Case Studies
1. CASE STUDY:
ISO 14000 BENEFITS MORE THAN THE BOTTOM LINE by EnSafe, Inc,
Phillip Wood, Manager, Compliance Services, Steve Rowley, CHMM, Senior
Environmental Scientist and Harry Kemp, Project Manager
- Annual savings of more than $250,000, a 34% reduction in waste generation,
elimination of CFC emissions, and a recycling rate of 75% were some of
the "bottom line" benefits an EnSafe client received by implementing a
proactive, comprehensive environmental management system (EMS) through
an ISO 14000 program. --
Task 1: Educate
Management - in ISO 14000
Task 2: Gap Analysis
Gap analysis is
a very short and straightforward process. The goal of gap analysis is to
quickly obtain an overall assessment of the company's current environmental
management activities in comparison to the ISO 14000 standard requirements.
This was accomplished through a review and comparison to each requirement
of the standard, and completion of a questionnaire about these requirements.
Task 3: Aspect Analysis
and Compliance Assessment
Briefly reviewing and
comparing the company's environmental policy, current documented
EMS procedures, and current EMS records to the appropriate sections of
Determining the in-house
capabilities and organization of the company's personnel and processes.
Conducting a closing
meeting to inform the company of any findings identified during the
assessment and preliminary report on the gap analysis results.
A graphical presentation
and a written report outlining all pertinent findings, conclusions, and
Task 4: Detailed Implementation
Plan and Timetable Development
ISO 14000 requires that
a facility or site establish and maintain a procedure to identify environmental
aspects of activities, products and services ". . . in order to determine
those which have or can have significant impacts on the environment" (ISO
14000, Section 4.3).
Because compliance with regulations and other requirements is so
important to an
effective environmental management system in the United States, the company
conducted a regulatory compliance review at the facility to evaluate compliance
with local, state, and federal environmental regulations. ISO 14000 requires
that compliance monitoring be a component of Monitoring and Measurement
(Checking and Corrective Action, Section 4.5: "The organization shall establish
and maintain a documented procedure for periodically evaluating compliance
with relevant environmental legislation and regulations." Also, the standard
requires a commitment to regulatory compliance (Policy, Section 4.2).
Task 5: Develop Environmental
Task 6: Objectives,
Targets, and Development of Environmental Management
Task 7: Documentation
Task 8: Development
of Documentation (Operational and Management Procedures,
and Work Instructions)
Task 9: Implementation
Task 10: Employee
Task 11: Internal
Task 12: Conduct Internal
Audits of the ISO 14000 Program
ISO 14000 requires that
the program be periodically internally audited, independent of anythird-party
Task 13: Take Corrective
Task 14: Pre-Assessment
Task 15: Formal Registrar
Task 16: Continuous
• CFCs were converted
to Class I refrigerants, a computerized program was implemented to track
refrigerant usage and repairs, and emission tracking software and emissions
flow charts were put in place. These programs eliminated CFCs, reduced
other emissions, and improved the system efficiency by 25% to 35%, resulting
in annual net savings of $164,000.
• Increased efficiency
led to a decrease in natural gas usage and electrical demand, resulting
in a net annual savings of $139,000.
• Waste minimization
reduced plant waste by 34% from the 1994 baseline level, which resulted
in net annual savings of $100,000.
• Increased recycling
rates from 68% to 75% resulted in a net annual savings of $15,000.
APPLYING ISO 14001
IN A SMALL- AND MEDIUM-SIZE ENTERPRISE THE WILTON ARMETALE CASE STUDY
by EnSafe Inc. and Dave Schell, Environmental Manager (The Wilton Company)
here) for entire case. EXCERPTS FOLLOW-->
WHY IMPLEMENT ISO
It is with this
perspective that Wilton incorporated ISO 14001 into its Green Plan. Wilton's
Green Plan included comprehensive environmental management techniques for
the company to follow in regards to waste handling, waste minimization,
recycling, waste reuse, energy conservation and education in the community.
Employees were taught
to analyze their jobs closely to find hidden waste and then implement suggestions
to reduce or eliminate the waste. Recycling programs were developed and
spread throughout the company in hopes of reducing waste going to a landfill
or incinerator. Soon, employees were collecting recyclable materials on
HOW WAS IMPLEMENTATION
A Gap Analysis to compare Wilton's existing EMS to the requirements of
identifying what would need to be accomplished in order to be in conformance
standard. The Gap Analysis was facilitated by EnSafe, with discussions
involving Wilton and
An aspect analysis, involving a thorough site and operations review to
identify how the site
and operations interact with the environment (aspects) and what changes
occur as a result
of the aspects (impacts). Again, this analysis was a joint effort between
Wilton, EnSafe, and
With the Gap Analysis and Aspect Analysis information in hand, Wilton began
of preparing procedures, incorporating existing procedures into the EMS
related training and awareness orientation of employees. This was an interactive
with Wilton implementing the system and updating PADEP on progress, and
reviewing and commenting on documentation and activities for conformance
Towards the latter stages of implementation, Wilton conducted an internal
audit of the EMS
for conformance to stated procedures. Wilton then engaged EnSafe to conduct
comprehensive second party EMS audit using ISO 14001 requirements and Wilton's
manual as the criteria.
BENEFITS OF EMS IMPLEMENTATION
has realized the following benefits from EMS implementation:
decrease in solid waste costs and volume, while production has steadily
increased each year.
25% of the company's solid waste pickup points have been eliminated. Over
40 tons of recyclable or reusable material (paper, wood, fiber drums, cardboard)
of Hazardous Waste in some processes.
of external packaging to consumers (using more biodegradeable products,
recycled paper for catalogs, etc.).
employee education about waste handling.
employee waste generation.
community relationships through education.
relationship with PADEP.
10/22/1999 -- Since
the Fuji Hunt Photographic Chemicals manufacturing plant in Rolling
Meadows, Illinois became certified to ISO 14001 in September 1997, it has
developed strategic processes that the recovery and sale of the silver,
and processes that eliminate isopropyl alcohol from pressroom fountain
here) but you will have to pay Globe Net a fee.
Label, Wayne A. and Wilbur Priester 1997
"Expanding Your Role in ISO 9000" (press
here) CPA Online