Growing concerns around energy generation, water shortages, flooding and rising sea levels present some significant challenges that demand attention in order to mitigate disruption risks due to potentially crippling supply chain events. The semiconductor industry, and especially chip manufacturing, is particularly at risk of disruption and crises due to these mounting environmental challenges.
While environmental challenges are often global, most solutions start at a very local, even individual, level. This article provides a look into how one distributor put into place a full set of sustainability programs, from building architecture, energy efficiency, and office recycling to employee and customer focused services around a zero-landfill goal for e-waste, asset disposition, and improved packaging for shipments.
What exactly is CSM?
Corporate Sustainability Management (CSM) is a broad-reaching, business strategy that not only can contribute to positive environmental sustainability but also can improve business sustainability and cost management. Unfortunately, while many businesses have begun to adopt CSM, barely one-third has successfully integrated CSM plans as part of their active business strategy and culture. So, how do we push past the early CSM speed bumps to be able to realize the positive public and business relations that offer genuine returns.
There are real businesses and environmental gains that CSM affords from improved margins and opportunities to contributing to improving environmental sustainability for generations to come. Smith & Associates has long believed that corporate and environmental responsibility go hand-in-hand and our efforts and participation in green events like the Green Office Challenges and Peer Leadership Groups sponsored by the City of Houston have helped us formulate approaches to CSM.
Where do we start?
Developing a realistic and successful CSM can begin with reviewing the best practices to gauge what improvements are possible and are a good fit for your company. These best practices reviews should consider not only facility use practices (e.g., timed and/or motion sensing lighting; energy-efficient lighting such as LED; video conference calling instead of travel; use of recycling stations; recycled office goods; environmentally friendly pest control and cleaning; etc.). Additionally, these best practices should also include a review of logistics practices, efficiency opportunities, and should establish a set of Key Performance Indicators (KPI) that can measure both day-to-day internal practices as well as more far-reaching improvements in efficiency and waste reduction by the company. (Please see this Smith & Associates case study for specifics around developing and implementing a short- and long-term CSM along with KPIs.)
Leading CSM activities range from direct environmental practices to internal company work environments:
- Green asset disposition (recycling, secure remarketing, zero-landfill, etc.)
- Industry certifications & accreditations (ISO 14000, etc.)
- Green corporate practices and green buildings (Sustainability Management)
- Environmentally-friendly manufacturing practices
- Greener work environments for employees
To be honest, Smith’s CSM has not always been defined at a granular level that easily produces ongoing, step-by-step action items that proceed as planned. At Smith, we learned that accepting the reality that sustainability and adherence to CSM goals throughout the organization are really fluid as opposed to fixed goals was very important to keeping the overall momentum. Maintaining momentum while allowing for flexibility along our own CSM path is the “trick” to how we’ve been successful. Just as quality and agility in the semiconductor and electronics supply chain are critically important and necessary to succeed in the marketplace, the same is true when it comes to sustainability strategies inside of an organization. As Smith’s Chief Administrative Officer, Matthew Hartzell, commented, “To Smith & Associates, the road to truly having a green company is long, but it is well worth the effort. We are proud of the commitment of our employees as well as the recognition and support that we have achieved thus far […].”
What are some initial CSM steps?
Taking small CSM steps first is a rational and feasible way to get started. The efficiency of the workplace setting itself is an opportunity for immediate CSM success in terms of cost-savings and reduction in wasteful uses of natural resources. More specifically, whether you own or lease your facility, it is possible to make a number of relatively low-cost changes and build momentum for CSM. The most recent major “Greenovation” project that Smith completed, just before Earth Day 2013 (which was also tied into our overarching CSM strategic plan), was the renovation of our trading floor. Interior renovations are typically part of a corporation’s plans, whether in an owned or leased facility.
Among the one-by-one, small steps that Smith has taken over the recent years are the following:
- Installation of video-conferencing capable phone systems at employees’ desks to reduce travel and carbon-footprint through easy and accessible use of VoIP teleconferencing;
- Energy-efficient lighting (conversion to LED technology);
- Sensors for lighting, water, and room controls to avoid waste;
- Increased use of recycled paper, paper napkins, and other products;
- Installation of campus-wide recycling stations, including recycling bins, waste bins, and paper recycling bins;
- Elimination of disposable cups for all employees by providing reusable company cups, mugs, and utensils, with use encouraged by Green Bag Lunches and speaking events;
- Switching to environmentally-friendly cleaning products and pest control services;
- Employee of the Month incentives include the free use of a corporate-owned Chevrolet Volt Electric Vehicle (EV) for each of two employees, with reserved parking in dedicated Level 2 recharging spots with PV shading; and
- Establishment of Smith Sustainability Group (SSG), an employee-directed green team comprised of employees and managers from across the corporation.
Checking in with the KPIs that your organization selected become critical steps to maintaining momentum because with each minor milestone, company-wide support builds and higher goals no longer seem out of reach. For Smith, we have focus on a definable set of metrics that include, but are not limited to, the following:
- Working towards significant energy use reduction (at roughly 43% and counting)
- Double the recycling of waste (we have moved from an average of 2.21 tons per month in 2008 to close to 6.50 tons per month and increasing)
- Increase average waste diversion to 95%
- Elimination of paper cups (over 53,000 paper cups saved annually)
Some big CSM steps
In preparation for the September 2012 U.S. Environmental Protection Agency (EPA) announcement of the Sustainable Materials Management (SMM) Electronics Challenge, Smith began to focus and intensify our CSM efforts that had been underway since 2008. The new focus for Smith’s global headquarters in Houston (a company-owned building, land, and facility) was a complete “Greenovation.”
In 2011, Smith completed a major renovation of its Houston headquarters. Smith’s “Greenovation,” an environmentally-based, energy-efficient, green renovation, included structural as well as more corporate changes, as detailed in this National Geographic article by co- founder, Bob Ackerley. The following are some of the major green building innovations and sustainability management programs that were implemented and tied together under Smith’s Greenovation project:
- Changing out asphalt roof with eco-friendly materials (cool roof and solar TPO poly roof system);
- Solar photovoltaic rooftop system that can generate 91.08KW of solar power;
- Solar thermal rooftop system to heat 115 gallons of water/day up to 140 degrees for office use;
- Solar photovoltaic parking system to provide shade and electric car recharging stations for employees;
- LED interior and exterior lighting systems with motion and light sensors, respectively;
- Replacement of compressed gas HVAC system with air-cooled chiller towers, exterior water pumps, and chill water air handling units.
In April 2012, after the completion of this Greenovation project, the City of Houston recognized Smith as the winner of the first-ever Greatest Implementation of Green Building Innovations award. This highest honor, awarded by Houston’s groundbreaking Green Office Challenge program, recognized Smith for its ongoing efforts to become fully sustainable and carbon-neutral in its campuses and operations at home and around the world. Partnering with municipal agents is not only a great motivator for resetting CSM goals and rallying the organization behind green momentum, but working together with municipalities establishes win-win relationships because they too cannot reach their city goals without the support and work of corporations. Together, we can make real change happen and realize successes on many levels.
One might describe recent examples of sustainability management as being “corporate grass roots.” Individual corporations and entire industries have seized on the type of efforts usually employed by individuals and promoted them to expand what quality management and corporate citizenry means today. For example, the global electronics supply chain, from materials to manufacturing, logistics and e-waste handling, follows legislated requirements as well as individual corporate sustainability management programs and environmental stewardship. Electronics companies are responding to consumer demands for reduced footprints, ever-lower energy consumption, and easy and reliable e-waste recycling, synchronizing them with traditional business goals of cost reductions, alignment with national and international electronics and carbon footprint regulations, and innovative solutions to increasing challenges of safety, resource and waste management.
Successful sustainability solutions from corporate leaders in the electronics industry are not just improving costs, reducing waste and carbon footprints, these solutions are improving customer and employee retention. While environmentalism can still be understood as an important grassroots effort, lessons learned from corporate sustainability efforts along the electronics supply chain is directly transferrable to multiple industries, cities, and back to individuals and the product choices they make.