2.6 Summary

2.6 Summary:

 This chapter includes the introduction about the structure of this chapter. In next part of this chapter need for development of EMS and main stages of development has been discussed.  The role of EMS as a driving force for sustainable development has been explained with supporting evidence from previous work done. In order to remain competitive and sustainable, improvement and up gradation of existing programmes and policies are mandatory to compete at global level. Implementation of EMS has been considered as a tool to ease trade barriers (Massoud et al: 2010) and to gain competitive advantage over competitors.

 Followed by EMS as tool for sustainable development, the constraints in implementation of EMS have been discussed. Literature reveals different factors which hinder the implementation process of EMS have quite similarity with work done before. The environmental trends have gained the attention of stakeholders has gained attention of environmental experts.

In addition, lack of participation and information, lack of understanding and expertise, lack of infrastructure with poor top management commitment is considered as constraints in implementation of EMS. High cost involved in certification process and lack of best available technology is considered as barrier to implementation.  

A similarity has been found regarding constraints and implementation of EMS. Different strategies and critical success factors have been suggested by experts for successful implementation of EMS.

 Pfliegner K (Hillary: 1997 p43-5) proposed that Harmonization and non- discriminatory application of standard, development of infrastructure can ease the implementation process with mutual understanding, information sharing and participation of public sector, NGOs and other relevant bodies. 

In short this chapter provides information about the background of EMS, its role and constraints in implementation with recommendation and suggestions for further improvement in implementation. Finally, the overall benefits and incentives have been discussed that firms can gain through implementation of EMS. The research methodology will be discussed in next chapter in detail.

2.5 Benefits of EMS implementation

2.5 Benefits of EMS implementation:

6-Uncertainty about the Benefits:

6-Uncertainty about the Benefits: 

Most of the companies are not sure about the outcomes and benefits of EMS adoption and maintenance. Uncertainty about the benefits has been ranked on third 3.38 out of five on scale by respondent in a survey conducted by Babakri et al (2003 p 751). Adoption ISO standard can be boasted through incentives and rewards like reduction in tax, provision of soft loans. Such initiative definitely can result in improvement of product quality, reduction in cost, enhancement in company’s image, facilitation in non tariff trade barrier. Furthermore, implementation of EMS and maintenance can helpful to gain market share by attracting and gaining confidence of environment conscious buyers’ and builds pressure on competitors. Moreover, with sound environmental and business practices, not only the ties with insurance companies can be dealt with lower premium but also likewise benefits can improve the productivity and development of the organization (Quazi 1999).

As a supporting element Massoud et al (2010) points that the government agencies and institutes with financial assistance, provision of technical support, training and education, ease of capacity building are considered the significant aspects for positive impact.

Although, EMS is a voluntary, flexible system for the goodwill of the organization, yet its conformity is still a challenge for different countries even developed one like America, Japan. It is pointed that the ISO/TC207 is a willing to address the issues regarding EMS in future like changing corporate culture, theme of sustainable development, awareness about environmental issues and obstacles in implementation.

EMS basically provides foundation to identify the environmental aspects of the activities, products, processes and functions and their impacts on the environment, community and organization itself.

 Lawrence et al (2002) points that all environmental aspects has sound influence on aim and objectives of the organization set through corporate policy urge the top management to remain committed for continual improvement. However, it is argued that no technique is specifying for assessment and identification of aspects and their impacts.

. In addition, the elements as discussed in previous section as constraints have bad impact on the environment indirectly in terms of scarcity of EMS adoption by firms. Moreover, a significant point of EMS implementation is the identification of environmental aspect and investigation of its impact whether it is negative or positive. It is helpful in finalizing the objective and targets to prioritize the aspects (Zutshi and Sohal: 2004)

5- Poor Govt. Support and Week Infrastructure:

5- Poor Govt. Support and Week Infrastructure: 

Moreover, the less developed countries like Pakistan are scary about contractual restriction of international standards adoption. According to Sasseville et al (1997:p.62) a considerable variance regarding acceptance and adoption of EMS may be seen depending upon country.  Furthermore, it is argue that lack of well defined policies and appropriate legislative infrastructure; is a barrier in the way of implementation (Hortensius and Barthel (eds.) in Sheldon, 1997) but with the desire to improve the environmental record industrial sector is hoping for the best. Legal implications are mentioned by Sasseville et al (1997: p. 205) given as

·         “Will ISO 14001 create a new standard of care?

·         Is the information you generated as part of your EMS discoverable by the government or other third party?

·         Will government bodies’ use, rely on, or require ISO 14001?

·         Are their liabilities associated with certifications process?

Developing countries might feel less confusion regarding adoption of EMS as compared to developed one owing to unavailability of EMS or poor standards of EMS but the above mentioned legal implications can give a tough time for adoption and maintenance of EMS. Quazi (1997) argues that the legal binding can hinder the implementation process and such obligations can push the organization, not to seek the certification or even terminate the certification process.

 Although, the ministry of environment in Pakistan is fully committed and aware to resolve the environmental issues by providing technical support to industrial sector but it is still in initial phase. Massoud et al (2010: p 207) states that “the provision of special tax exemption, training and capacity building , provision of the soft loans and enhancing knowledge on ISO 14001 EMS are perceived as most important factors” to ease the successful adoption of EMS. It is identified by UNIDO experts that developing countries, least develop countries especially, facing issues like poor government policies, less emphasize on institute building (Hillary 1997: p. 41) and promotion of EMS implementation. The public sector participation and support is considered as most effective supporting element for successful implementation and to reduce and overcome the obstacles in adoption of EMS.

Supporting evidence can be imported from ‘Expert Seminar’ held in London on 22-23, September 1994 by the participants of the UNEP IE/PAC Cleaner Production Programme: Environmental Management Systems in the promotion of cleaner processes and products. The recommended elements of seminar has been mentioned below

·         “ Government should develop policies which allow enterprise to build on the existing mandatory framework, by aligning economic and environmental goals

·          Standards and other measures to promote  environmental management systems need to respect international differences but all need to incorporate clear and credible continuous environmental performance

·          Government should take the uptake of voluntary environmental management system

·         Government and international organizations should establish to programmes to communicate the objective of environmental management systems clearly

·         Government should encourage and enterprise should adopt environmental management systems which ensure credibility, accountability and comparability” (Hillary 1997: p. 5-6).

4-Unclear Responsibilities:

4-Unclear Responsibilities: 

In addition, unclear responsibilities, creates a communication flaw among different roles and authorities working for single goal. In implementation plan, the roles must identify and responsibilities should be allocated clearly because the activities of personnel have impact on the environment directly or indirectly (Quazi: 1999). A correspondent with clear job role and responsibility can understand the requirements of the job better. Sasseville et al (1997:83) suggested two points for better implementation of plan

·         Identify a team of people with specific responsibilities for leading the development of specific elements.

·         Identify a person with overall lead responsibility for implementation and planning.

3-Lack of Financial Resources and Cost of Certification :

4-Lack of Financial Resources and Cost of Certification : Manufacturing industry in Pakistan is mostly belongs to SMEs domestically owned and operating as having less interaction with international customers directly. Due to limited resource of finance manufacturing industry is not capable to bear the cost of certification, adoption and maintenance of EMS.  The higher cost of adoption and maintenance of EMS with limited financial resource has been identified as a barrier in successful implementation.

 In Lebanon, certification costs ranges between 15,000 to 20,000 USD (Massoud et al: 2010) belongs to registration and certification, while in Singapore for small medium company it costs S$ 16,000 with additional yearly recurrent fee of S$ 6000 (Quazi 1999) that is an additional burden with weak financial infrastructures. In addition, it is argue that with the implementation of proper EMS initial cost increases which is not bearable for small medium sector without public sector support.

 Massoud et al (2010) points towards the limited financial capacity of the organization that are already facing financial challenges are not willing to invest further. It reveals from previous literature that long processing time for certification and enhancing cost make organization reluctant to move forward willingly, results in withdrawing from certification process.

 As a result of survey Babakri et al (2003 p.751) identified higher cost of certification was considered by respondents the biggest constraints in implementation with mean value 3.47 out of five. Massoud et al (2010 p.201) points that ‘lack of financial and technical resources slow down the progress of SMEs for their environmental management and improvement programmes. However, incentives and rewards for adoption of EMS can increase response towards sustainable development and implementation of EMS. Most of the ISO 14001 certified companies are multinational with few national companies.

Massoud et al (2010), tabulated main elements regarding acquisition and adoption of EMS

Table 2.4: Barriers, Challenges and demand for Govt. Support.

Barriers	·         Not a legal requirement ·         No demand from customers or stakeholders ·         Lack of incentives ·         Lack of government support ·         Lack of resources ·         Cost/duration ·         Creates competitive advantage ·         Lack of in-house knowledge and skills
Challenges	·         Staff training ·         Management system documentation ·         Defining company  environmental policy ·         Identifying targets and objective ·         Monitoring and measurement procedures ·         Time demand for certification ·         Cost of ISO certification and consultation fee ·         Management review ·         Language Barrier
Demand for government support/ Incentives	·         Special tax exemption for ISO 14001 certified firms ·         Encouraging eco-labelling and rewards ·         Enhancing knowledge and advantages of ISO 14001 among non registered companies ·         Establishing national institutes for technical advice and consultants services ·         Implement special soft loans to firms who are going to implement ISO 14001

Source: Adopted from Massoud et al/ Journal of Cleaner Production 18(2010) p.200-209

2- Lack of Awareness and Training:

2- Lack of Awareness and Training: 

In many organizations, due to lack of understanding about EMS and structure of the organization, relevant personnel were less interested in adoption and maintenance of EMS. Environmental awareness is considered a significant element in successful adoption and maintenance of EMS and it has a direct impact on environmental performance (Sassevile et al 1997).  Pakistan‘s major industrial sector includes textile and cloth industry; leather processing, food industry, fertilizer, refinery and etc. Regardless of the size and nature of the organizations in Pakistan industrial sector is facing crucial situation in implementation of EMS like other developing countries which has left serious impact on the environment (Massoud et al 2010).

 After the introduction of ISO 14000 series, many countries were unable to conceive the full meaning of terminology used in documentations (Ponsinska et al 2003)and moreover, companies felt difficulties regarding interpretation of new standard (Quazi 1999). One reason of poor implementation might be considered lacking of information sharing and active participation of member countries at the time of formulation of international standard; led to unfamiliarity with EMS

 Pfliegner, K. (Hillary: 1997 p.39) states that “A lack of expertise, based on a shortage of qualified auditors and consultants, is a further obstacle for developing countries. However, outside help (environmental consultants, NGOs and other relevant bodies) can ease the process of adoption of EMS depending upon the size and nature of the organization. In large companies personnel might have know-how about ISO and its different versions & EMS but SMEs need to get assistance from consultants and other relevant organization (Sasseville et al: 1997).

These problems can be encountered by companies at different stages, might be during preparation stage, defining, documentation and training level (Babakri et al (2003); and these aspects are considered complex elements of improving process (McCloskey and Maddock 1994). Furthermore, McCloskey and Maddock (1994) argues that ‘the wide span and complex nature of the environmental issues itself is a hurdle in implementation of EMS which are normally expressed as having concern with limited financial support, economic condition, inability to understand EMS and its impact, and market position. Razaee and Elam (2000 p.62) suggests that in-house training and education of the employees can ease the process of implementation and adoption, providing them proper support regarding finance and reading stuff. In addition, ‘Awareness Training’ of everyone in the organization should be carrying out to understand the EMS and its impact on the activities which is helpful to perform duties effectively.

 As training is referred to acquisition of specific skills and knowledge to know how to perform specific jobs (Zhang: 2000). Sasseville et al (1997:106) proposed that training programme should include

·         Identify your employee training need.

·         Develop a training plan to address those specific needs.

·          Ensure that your training programmes is in conformance with applicable regulatory and internal regulatory requirements

·         Select and target employees group

·         Document the content, target group, frequency and effectiveness of your training programme

·         Evaluate and review complete training programme