Ramon Arratia of InterfaceFLOR explains why company disclosure must embrace the full product life-cycle
After more than a decade of refinement, CR reporting by companies has progressively improved to achieve a high level of transparency about a company’s social and environmental impact.
Although the better reports discuss product impacts, the data in most CR reports still focuses primarily on performance of the company’s operations. For many companies this focus is mismatched with their true impact, which lies outside their operations in the life-cycle of their products.
When you view a company in terms of the products it makes, you frequently discover that the vast majority of environmental impacts lie outside its operational boundaries.
The impacts associated with raw materials extraction and processing, product use and end life, in many cases far outstrip the ‘in-house’ impacts. For our company manufacturing carpet tiles, around 68% of the impact is associated with the production of raw materials while only around 10% is in-house.
The extent of the mismatch depends on the type of company – in the mining sector, the main impacts may well be in-house. But in manufacturing and services this is usually not the case. Additionally, the business trend over the last decade to greater outsourcing has transferred more and more impact outside the company boundary.
So the seemingly impressive programmes and targets of many companies are in fact often confined to minor issues. Even when companies do talk about supply chain issues, it is usually in terms of codes of conduct and audits rather than performance data, that for many, now lies beyond their reach.
Break it down
The case for full product transparency is even stronger when you consider consumers and business customers. They don’t buy companies, they buy products, yet most of the information available to them on company websites and in marketing material is based on company performance.
Marketing teams have the impossible task of trying to differentiate their product from competitors when in reality there is little significant difference in environmental impact and a lack of data to establish the facts.
Frustrated at the inability of their CR colleagues to provide them with clear reliable sustainability product benefits, they have begun to fill the fact vacuum with partial claims or worse inaccurate statements.
This is producing an increasing volume of marketing greenwash, something that has been observed by for example the UK Advertising Standards Authority.
Starting with the marketing brief and working out what can be said about an existing product is an inherently flawed process: post-rationalisation. What we need to do is to place product design at the heart of the company sustainability strategy.
Wouldn’t it make more sense for companies to compete about having the most sustainable product and for the competition to drive product innovation?
LCA's can be abused
Life-cycle assessment (LCA) is of course the prime tool for sustainable design. InterfaceFLOR conducts an LCA for every carpet tile we market and we use the data to guide design innovation. For example, through LCA we identified nylon yarn as our biggest issue and came up a design that uses up to 50% less yarn per tile.
LCA has a troubled history because manufacturers frequently manipulated the terms of the LCA to favour their own product. Safeguards governing how LCAs are conducted are key to the data being a reliable basis for comparing products. We believe that an Environmental Product Declaration (EPD) provides the necessary framework.
An EPD includes an LCA that quantifies the environmental burdens of the complete life cycle and must be conducted by an approved third party independent of the manufacturer. The EPD also discloses a full ingredients list with details of their origin.
By standardising the methodology and insisting on independent LCA, the EPD ensures objective information is available to customers and
At InterfaceFLOR we have committed to disclose the impacts of all our products before 2012. We call this ‘full product transparency’ and believe it signals the next generation of company disclosure. We hope the rest of the industry joins us.
We look forward to the time when a customer tells us, “cut the fluff and send me your EPD”. For the first time market forces will really drive research and innovation and significant reductions in product environmental footprints will be achieved.
Ramon Arratia is sustainability director, EMEA, for InterfaceFLOR.
Join Ramon Arratia for a live text debate on October 8 2010 online on Ethicalcorp.com. The event will be a live online debate on stopping greenwash with full product transparency. To sign up for a reminder go to: http://bit.ly/3qutS2
For a podcast with Ramon Arratia click here to go to the podcasts page.