HomeFor BusinessesFor Accountants
Ten Good Reasons Why You Need An EMS

Think of the planet as a corporation, with Mother Nature as its President. When you realize that she has been in business for 3.8 billion years, you'll have to agree she has her business down pat and has the upper hand.

There are many, many reasons why having good management control of your relationship with the environment is important.

Here are ten good reasons. Obviously this is the short list.

One - the science evidence. Most human designed systems are basically inefficient; experts hold that most are 96% inefficient by weight. That means for every $100 of effort, there is $4 of actual value. That's simply not good. Firms in the know are using EMS as a mechanism to drive improvement in their productivity by greening it.

Two - an EMS can be used to manage changes, big and small, in the business process. Sustainability guru Bob Willard has gathered data from small and medium-sized businesses. Not only can going green lead to cost savings and add to the bottom line, his research has uncovered increases as high as 66% in profit in SMEs. These are serious top line improvements.

Three - while the concerns voiced over the last 40 years have been attributed to 'tree huggers', credible multinationals are starting to see the impact of poor environmental management affecting their bottom line. We are entering the era of business unusual.

Four - in 2008 the cost of global environmental externalities was nearly US $ 7 trillion, or 11% of the value of the global economy, with 3,000 companies causing around 35% of them, according to a report by the World Business Council for Sustainable Development. That still leaves 65% of the market adding to the problem. Small business is the foundation of most national economies. Small business will not be exempt, nor should they be.

Five - these 3,000 companies are under tremendous pressure to improve. They are not the only ones. Obviously this pressure will flow upstream as companies push their suppliers to work with them, or remove them from the list of approved vendors.

Six - as budgets grow tight, government supported programs tend to fade away and the fallback position is on more regulatory-based measures. The European Union is only one of the economic regions that is under stress, but it will have ripple effects around the globe. Regulation is not typically written for SMEs, and adds cost without solid evidence of environmental benefit. The ongoing outcomes of an EMS can position an SME ahead or above regulatory thresholds. For reports on the cost of regulation and its impact on small business and prosperity, go here.

Seven - many SME owners are thinking about retiring in the next ten years - over 70% of the business population in many countries. It will be a buyer's market under 2025; green will undoubtedly be one of the deciding factors if not the preeminent reason to choose one company over another. An EMS can prove to the buyer that the company has exercised better management control, reducing the potential for hidden liabilities.

Eight - the legacy issue has other implications. Many SMEs are family owned. Unless there has been a solid management approach for the environment, an intergenerational sale may carry with it the harsh reality of heavy financial penalties and even jail sentences for the new owners, your children or your grandchildren. Succession is enough of a nightmare for a small business unless it is well planned, and this is not common.
Watch noted environmental lawyer Dianne Saxe explain the pitfalls in the interview series "In the Limelight".

Nine - "Over the past 20 years, environmental risk and liability issues have emerged to become one of the most value-destructive factors facing family-owned businesses, and are therefore major factors in the family business valuation." Don Schwerzler, a well-respected advisor on succession planning for family-based businesses in the US, has proven that the adoption of ISO 14001 has not only helped stop the drain on valuation, he has used it with good success to prepare the business for sale or transfer.

Ten - what so many policy makers and shapers over look is the fact that most small business owners have already bought into the opportunity of better environmental management. Three surveys conducted by the Canadian Federation of Independent Business (CFIB) between 1991 and 2007 consistently indicated that over 80% of small business owners believe they can protect the environment and growth the economy. What they lack are the right tools, and guidance from a trusted business advisor.