The Aqualtis washing machines, said to be Indesit’s most energy-efficient model of its class, are manufactured using nonpolluting spraying methods in its Comunanza plant in Italy.
Appliance makers do not automatically view environmental considerations as antithetical to business development. At the Green Manufacturing Conference held in Anaheim, CA, U.S. in January, speakers noted a growing trend: More and more companies are taking the initiative to adopt eco-friendly manufacturing practices. What’s more, as Open Circle Innovations managing director Harvey Stone told attendees, this new wave of corporate awareness is driven by the top management level, where sustainability and corporate social responsibilities are taking on more prominent roles.
Stone’s consulting firm provides green manufacturing solutions. He believes this shift has to do with companies coming to realize that their self-interests are linked directly to the health of communities and the natural world. “Like live organisms, businesses will flourish, languish, or perish based on their ability to adapt,” says Stone. As the threat of global warming looms larger day by day and corporate behaviors come under stricter scrutiny, “governments, customers, and shareholders will increasingly require the same levels of transparency for environmental accounting as for financial accounting,” says Stone.
Indeed, mechanisms for monitoring the environmental performance of corporations, both private and public, already exist and are gaining momentum. The Carbon Disclosure Project (CDP; www.cdproject.net), a nonprofit organization acting on behalf of more than 385 institutional investors, solicits data on greenhouse gas emissions from the world’s largest companies every year. The information is then compiled and made public online. Although participation is voluntary, the sizable total assets it represents—more than $57 trillion, according to CDP—make it a force hard to ignore. In 2008, more than 3000 companies responded to its climate change questionnaires, including LG, Hewlett-Packard (HP) Co., Husqvarna AB, Sony Corp., and Whirlpool.
Environmental Management Tools Are Essential
Many appliance OEMs are leading the way in the new wave of this self-motivated green movement. “Today, companies are judged not just on their business results, but also on their ethical, social, and environmental conduct,” Fabio Ginesi, a manager from the international technical affairs department of Italian appliance manufacturer Indesit Co., tells APPLIANCE magazine. “We combine the economic development with social progress, trying to reach a fair balance and focus our efforts on innovative products with a low environmental impact.”
In 2006, Indesit launched a project to identify environmental key performance indicators (KPIs) in an effort to monitor the environmental impact of its facilities and define measurable targets for improvement. The KPIs and related targets are now incorporated into an assessment system used by plant managers and will be monitored on a monthly basis as a management control activity, according to Indesit.
The project has already spurred some changes that benefit both the environment and the company. “We decided to replace liquid paints with powder-based products. This means a substantial reduction in the use of paints, the absence of solvents, and the possibility of reusing nearly 100% of the overspray that forms in the painting process,” says Ginesi. Indesit started using powder-based paints in its cooling plants in 2003, and now the spraying process has been adopted by all of its facilities worldwide.
ISO 14001 certification is also high on the priority list for environmentally-conscious appliance OEMs. The global standard provides the requirements for an environmental management system (EMS), so companies can minimize the impact of their operations on the environment. Indesit says that by the end of 2008, more than 60% of its plants will be certified to ISO 14001, and all of its major plants are scheduled to be ISO 14001 certified within 2009.
Appliance maker Electrolux has also implemented EMS in most of its manufacturing facilities with at least 50 employees. In 2007, 94% of its 94 factories were ISO 14001 certified, corresponding to 98% of the manufacturing area, according to Henrik Sundström, vice president, group environmental and sustainability affairs of AB Electrolux.
The main goal of EMS is to reduce an organization’s impact on the environment during production. Many companies achieve this through the use of clean energy, or electricity generated from nonpolluting sources like solar, hydro, wind, and landfill methane and biomass.
Last November, HP signed a power purchase agreement to install 5000 solar panels at its San Diego facility. The panels convert the sun’s light energy into about 1,676,000 kWh of electricity per year, enough for 10% of HP’s energy use on the site. Initial estimates show that the project will save HP about $750,000 in energy costs during the next 15 years. In addition, the company will earn renewable energy credits, as the installation will reduce CO2 emissions by more than 1 million lb per year. HP has also adopted wind power for its facility in Ireland, making 90% of its energy use in Ireland renewable.
Pat Tiernan, vice president, social and environmental responsibility, HP, believes it was a wise investment. “Switching to renewable energy sources such as solar and wind power makes both environmental and business sense.”
Similarly, last October, Sony Group signed an agreement to purchase 16 million kWh of biomass renewable energy. Together with existing contracts, the group now purchases a total of 36.4 million kWh of renewable energy per year for use by its companies in Japan. Sony Digital Audio Disc Corp. Austria and Sony Austria have also shifted their entire energy supply to water-generated 100% renewable energy since last November.
By using postindustrial wastewater in the scrubber (pictured) to clean the air in the factory, TOTO USA has reduced its potable water consumption by 500,000 gallons per month.
On the Water Front: Conserve and Save
Water is another hot-button environmental issue, as climate change causes irregular weather patterns and premature snow melt, often leading to severe droughts. TOTO USA Inc. makes water-saving bathroom fixtures, such as the EcoPower faucet, engineered with the Smart Sensor for automatic water-flow adjustment, and tankless Neorest fixtures, engineered with a Cyclone Siphon Jet pump system for flushing. In 2004 the company sought to increase the water conservation of its production facilities as well, and started a program to recycle the water it uses to manufacture vitreous china products at its ISO 14001–certified manufacturing facility in Morrow, GA, U.S.
“With this water-recycling program, we were able to reduce the amount of water used on a monthly basis by 18%, which is equivalent to 250,000 gallons of water per month or 3 million gallons of water per year,” says Lenora Campos, PhD, public relations manager of TOTO USA. The company then puts the water it uses through extensive treatment and purification processes before returning it to the local water authority.
In 2007, in an effort to alleviate drought, the governor of the U.S. state of Georgia mandated that all corporations in the state reduce their water consumption by 10%. TOTO set its goal higher. “We reduced water consumption by an average of 25%, saving an additional 3,859,000 gallons of water from November 2007 to January 2008, through the implementation of gray-water programs,” says Campos. “We use more than 1 million gallons of gray water each month for all plant maintenance purposes, e.g., washdown, robot scrubbers, and outdoor irrigation. This aggressive recycling program saves more than 1 million gallons of potable water.”
Packaging Design: Better Used and Small
Many companies have turned product packaging into an opportunity to flex their green muscles. Using recycled material is a good start, since it helps reduce the use of landfill and takes less raw material and energy to process, thus leaving a smaller carbon footprint in a product’s life cycle.
Campos says TOTO collects cardboard packaging and other paper waste at each of its three Georgia plants. A local paper mill recycles them as packaging material, which TOTO then purchases for use in its product packaging.
At Nokia, new packaging launched in 2006 uses only material containing 55% postconsumer recycled content. Moreover, the new design shed half of the volume of its predecessor, taking on a much lighter, smaller, and thinner look. “We want to evolve from the standard packaging solution to offer the right package for the right need,” says head of environment for Nokia North America, David Conrad, speaking at the Green Manufacturing Conference. Because of its significantly reduced size, “this package has taken 5000 trucks off the road and created approximately US$150 million direct savings from materials and transportation reductions,” says Conrad.
After much experimenting, the company’s researchers also came up with a foldable inner tray to replace the original 3-D tray inside the package. Not only does the flattened shape make shipping easier, but the flat surface can accommodate five-color printing, allowing for more aesthetically engaging design as well as more room for printed message.
Opportunities or Threats?
Manufacturers are gradually realizing that sustainability efforts can and often do lead to cost savings and innovations. The challenge lies in exploring and implementing ideas that are environmentally and economically viable. Bruce Klafter, a speaker at the conference and head of corporate responsibility and sustainability at Applied Materials Inc., believes that businesses are better off leading the trend rather than playing catch-up. After all, “Sustainability is here…whether we see this as an opportunity or a threat is up to us.”