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Environmental Indicators: A Study of Eight Companies in Three Branches of Industry
KTH, School of Industrial Engineering and Management (ITM), Industrial Ecology.
2004 (English)Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE creditsStudent thesis
Abstract [en]

Swedish companies have invested a lot of time, effort and resources into becoming moreenvironmentally friendly. The primary focus of this on-going process has been to implementenvironmental management systems and to develop more environmentally friendlytechnologies. Measuring the effects of these actions has proven more difficult. Theintroduction of environmental indicators is emerging as a simple, yet effective way forcompanies to measure their environmental performance, increase the control of theirenvironmental activities and help the decision making process when developing new productsand processes.

The aim of the project is to study to what extent eight Swedish companies in three differentbranches of industry use environmental indicators, if there are any similarities and differenceswithin and between branches and if any conclusions can be drawn. The companies chosen arethree companies within the pulp- and paper producing industry, three companies within theiron- and steel producing industry and two companies within the car manufacturing industry.The primary method of analysis is to study the environmental report from one factory of eachcompany, the environmental section of the financial report and/or the environmental report ofthe entire company or business group and environmental information on each company’s website. No interviews were conducted with any of the companies, since it was deemed that therewas not enough time if they were to be meaningful.

Before the evaluation, the concept of environmental indicators needs further examination. Theindicators are comparative, comparing an environmental quantity to a financial one. Examplesof common indicators are energy use per quantity of produced product or emissions of CO2-equivalents per tonne of produced product. Since the denominator is the same, companieswith significantly different sizes of production can easily be compared to each other. Today itis hard if even possible to compare companies within the same branch to each other and evenharder to compare ones in different branches to each other or to branch indexes. The lack ofcommon guidelines for measuring, processing and presenting the results of environmentalperformance data is the biggest problem when using environmental indicators today.

The environmental indicators can be used in a number of different roles. Today they are usedto measure and compare the environmental performance of a company as well as tools forcommunication to various stakeholders. If the companies continue to develop the indicators,they can be used pro-actively in the decision making process as well as to highlight problemareas and to track the progress towards goals set by the company. Some of the companies inthis report are already using indicators in one or more of the advanced roles.

All the companies were evaluated in two different ways, qualitatively and quantitatively atthree levels of reporting. The three levels were the environmental report from a single factory,the environmental report for the entire company/business group and the environmentalinformation on the Internet from each company.

The qualitative evaluation analysed how the companies used environmental indicators, if thecompanies used them explicitly, if they used them to track goals and if there were differencesbetween the different levels of reporting. The analysis showed that only a few companies usedenvironmental indicators at the single factory level, but that all companies used them in thebusiness group reports and on the Internet. There was also a much higher degree of coherencybetween the companies financial reporting than there was in their environmental one. Thequalitative evaluation also showed that the pulp- and paper companies used the mostenvironmental indicators, the iron- and steel companies used them most effectively and thatthe car companies used them to their fullest extent.

The quantitative evaluation analysed each company by itself to examine how each individualcompany used the environmental indicators. The differences between the use of indicators atthe different levels of reporting also became more evident. The pulp- and paper companieswere the most consistent while the iron- and steel companies had the biggest differences withthe car companies somewhere in between. The analysis also showed that companies that werepart of bigger business groups had bigger differences, especially if they were not part of themother company.

There are two major conclusions that can be drawn from the report. The first one is thatcompanies use environmental indicators to measure and present their environmentalperformance because they see them as effective tools. The second one is that commonguidelines are necessary to develop the indicators further.

The first conclusion can be drawn from the fact that all the companies use environmentalindicators as a tool for reporting their environmental performance in their primary channels ofinformation, the business group reports and on the Internet

The second conclusion can be drawn from the fact that even though the companies werechosen because they produced different products, they turned out to have very similar types ofemissions but very different environmental indicators. Since all the companies are verysincere in their efforts to limit their impact, on the environment and the fact that they have allchosen environmental indicators to measure their impact the need for coherency is great forfurther development. It is doubtful that the companies themselves can develop the indicatorson their own which means that the authorities and possibly the branch organisations have towork together to develop common guidelines. The biggest challenges are to decide on thecommon rules of reporting and to put financial values on the environment. If these problemscan be resolved, environmental indicators can be used to their fullest potential in the future.

Place, publisher, year, edition, pages
2004. , 63 p.
Trita-KET-IM, ISSN 1402-7615 ; 2004:22
Keyword [en]
Environmental management, environmental indicators, environmental information handling, environmental reports, environmental performance, environmental stakeholders, iron- and steel producing companies, pulp- and paper producing companies, car manufacturing companies
National Category
Social Sciences Interdisciplinary
URN: urn:nbn:se:kth:diva-32582OAI: diva2:411114
www.ima,kth.seAvailable from: 2011-04-28 Created: 2011-04-15 Last updated: 2011-04-28Bibliographically approved

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