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How Long Is Your Environmental Management System Value Chain?

mcsparrin-lynnjeanSuppliers and contractors are called out three times in the current ISO14001:2004 standard with requirements to communicate with all of them. The standard states that the environmental policy needs to be communicated to “all persons working on behalf,” and that is quite of lot of communicating since many resources essential to the environmental management system are outsourced, from contract temporary employee services, to laboratories, waste haulers and recyclers — even your compliance professional.

No matter who pays, the individual working for the organization that was hired by your organization needs to know you have an EMS. Even though you have no control or influence over the lab tech who runs your tests or the guy who drives the truck that hauls your waste off site, they need to know you have an EMS, what requirements apply to them and how to comply. The sad story is that most chemical and safety hazard investigation reports all too often involve contractors and sub-contractors.

Lab work done in house by your organization’s own employees is a first-party relationship, one of control and hierarchy, of inbred monitoring and measuring. The hauler of scrap or waste is in a second-party relationship, one of control and influence; it is in his best interest that you are pleased. Your Registrar’s representative is a third party, influenced by your records and not controllable except by appeal.

But in this complicated world, when so much work is outsourced to resource services that can do the job better or cheaper or with special expertise, each layer removed from corporate control adds to the risk that work will be done poorly, will not be done at all, or will be delayed. This is true for first parties as well as fifth parties; a value chain is only as strong as its weakest link. Each party’s interest in you, their customer, or their customer’s customer wanes the further away from you they are.

How long are your environmental management system’s value chains? Knowing your stakeholders and shareholders and the context in which you operate becomes increasing important as some value chains stretch to four or five layers of subcontracting, such as with recycling. Remember, risks and opportunities are mitigated by outside interested parties such as the Environmental Protection Act and its Agency. It’s always good to know who has your back.

I find that companies typically outsource those activities (a) which are a high liability, like hazardous waste transport storage and disposal; (b) where the test is technically complex or where the output is sensitive; or (c) that are beyond the scope of the organization itself, such as when maintenance is outsourced on the building and grounds.

Lynn Jean McSparrin
Lynn Jean McSparrin is former Registration Accreditation Board Certified LEAD environmental management system auditor. She is owner and principal of Best Impressions Environmental Management Services and writes on the International Standards Organization and its application in North America.
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