ISO 14001: A Case Study in Certification at Bayer Pharmaceuticals in Berkeley, California Lauren E Godshall Environmental Sciences, University of California at Berkeley Abstract The ISO 14001 standard is a voluntary international standard outlining the framework for the creation and implementation of an environmental management system (EMS). Being certified as an ISO 14001 company is considered highly prestigious and valuable but few American companies have chosen to build an EMS and gain certification, possibly due to concerns that ISO 14001 tends to only create a “paper EMS” that does not add environmental value to the company. The Bayer Pharmaceuticals site in Berkeley, California is the only Bayer site in North America currently certified. This study employs a case study methodology to conduct an analysis of the company's certification process in order to lead to an understanding of the factors that prevented the Bayer process from resulting in a valueless ISO 14001 certification. Evidence suggests that the two most important factors in determining whether the ISO 14001 EMS improves the environmental performance of an organization are (1) auditor bias/knowledge of environmental policy and science; and (2) motivating factors within the company for achieving certification.Introduction The current environmental regulatory regime is highly command-and-control oriented, with strict sets of rules dictating limits on emissions and often stricter agencies charged with monitoring compliance with the standards. The inherent inflexibility of this system has created adversarial relationships between business and government, and hinders attempts at collaboration (Lally 1998). Growing concern over this state has led to increasing numbers of proposals for cooperation between the two players. Recent proposals in the US and Europe have suggested a more "voluntary" approach to environmental protection in which a general framework would be established and each industry or business could organize their operations and services in the most effective way to work within the parameters of that framework (Andrews 1998). A growing consensus is developing among world-wide industry that environmental protection and compliance are best achieved when environmental factors are integrated into industrial operations in a systematic way (Diamond 1999). Happily, a voluntary framework with both binding but adjustable parameters and a systematic integration of environmental tasks has developed in the ISO 14001 international standard. The ISO 14000 standards were released in 1996 by the International Organization for Standardization, having been requested by the United Nations following the Rio Environmental Summit (Lally 1998). ISO 14001 is the specific standard that provides guidance for the development of a comprehensive environmental management system (EMS). The EMS is based on the Total Quality Management (TQM) business concept of continuous improvement, or the Plan-Do-Check-Act cycle in which a procedure is developed, implemented, and then reviewed and improved upon if necessary. This cyclic nature ensures that the EMS is both proactive and continuously improving. While ISO standards are voluntary, market forces have mandated compliance with 14001’s predecessor, the ISO 9000 standard for quality management, as a virtual passport to the conducting of international business (Diamond 1999). The expectation is that eventually 14001 will follow suit, and companies without certification will not be able to engage in international trade. This has contributed to the large numbers of European and Asian companies certifying their EMSs under the standard. However, in the US, companies have been both slow to adopt the standard and highly critical of its potential value. Procter andGamble, for one, has stated that it specifically did not want to be associated “with the ISO 14001 bureaucracy” (Business and the Environment 1997). Most criticisms of the standard stem from the perception that certification is essentially an exercise in creating large amounts of paperwork (Buchholz 1999, Business and the Environment 1997). Policy analysts have noted that: “ISO 14001-certification mandates by large corporations may promote ‘paper EMSs’ in which certification is nothing more than a bureaucratic exercise that does not result in improvements in environmental performance. . . A race to become ISO 14001 certified solely for the sake of certification would erode its value as a tool for better environmental management” (Morrison et al. 2000). This criticism is important because the few case studies on ISO 14001-certified firms that have been performed have noted at least some improvements in environmental performance. These studies have all documented positive impacts of ISO 14001 and have failed to uncover any negative results from undergoing the certification process (Boudouropoulos and Arvanitoyannis 1999, Gunningham and Sinclair 1999, Ruddell and Stevens 1998, Mohammed 2000). But despite this, the perception that certification is a valueless exercise remains. ISO 14001 registration is seen as a non-value-added process with uncertain benefits, and a “wait-and-see” approach among US industries have slowed acceptance of the standard nation-wide (Ruddell and Stevens 1998). Similar concerns have been raised over the related ISO 9000 standards for quality management, which were used as a model for the language of 14001, as the standards do not specify how to develop quality processes. Instead, they require only that a company define its own processes and document them, thus defining what the system is but not how effective the system will be (Kanji 1998). However, while 9000 has the advantage of being a requirement for international business, 14001 does not. Unless further studies are performed that support or deny the worth of the claims that 14001 certification is a paperwork exercise, the industry perception of 14001 will not change. Towards this end, I have conducted an analysis of an individual company's certification process, in order to evaluate the validity of the concerns that ISO 14001 creates a “paper EMS.” A review of the process that the studied company underwent will demonstrate what, if any, significant changes to practices and procedures occurred that would ultimatelyimprove the environmental performance of the corporation, and help disprove the perception of
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