From a corporate standpoint, progressive environmental management encompasses all efforts to minimize the negative environmental impact of a firm’s products or services throughout the entire life cycle, from “cradle to grave” (Klassen and McLaughlin, 1996). Environmental concerns in purchasing and supply chain management deal with an assortment of issues, and from an investment recovery perspective, particularly deal with the last three bullet points listed below:
 
  • Water, ground, air and noise pollution.
  • The use, storage and disposal of hazardous materials and their waste in manufacturing.
  • Waste water management.
  • Unsafe and unhealthy working environments.
  • Unsafe finished products.
  • Industrial harm to plant and animal life.
  • Restoration and reclamation of lands impacted by industrial activity.
  • Reuse, recycling or disposal of excess inventories, equipment and manufacturing-generated scrap.
  • Sale or recycling of obsolete or scrapped end products.
  • Design of products and manufacturing processes for material conservation, reuse or recycling.
Investment recovery consists of finding alternative uses for items that are no longer of direct value to a firm, with the primary purpose of deriving the greatest financial recovery for the disposal of a company’s surplus or idle assets. For investment recovery professionals, their day-to-day responsibilities directly aligns environmental concerns with fiduciary responsibilities.
 
Perhaps it would come as a surprise to the media looking for a sensational story, but most large corporations are extremely sensitive to environmental issues. And perhaps nowhere is that more visible than with the utility and forestry products members of the Investment Recovery Association. There are 25 member companies of the Investment Recovery Association that are categorized as utilities, and virtually every one has a significant position on its website detailing its commitment to advanced environmental policies. The positive impact these companies have on the environment is substantial, as a few examples will show.
 
Investment Recovery Association member South Carolina Electric & Gas Company is part of SCANA Corporation, whose environmental stance is stated as follows: “SCANA is fortunate to be the guardian of lands that run through the heart of the Southeast United States, following rivers and rights-of-way needed to provide energy to our customers. In the best interest of our family and yours, we work to protect and preserve the beautiful lands that host our facilities and carry our pipelines and power lines while providing the public with access to many of the area’s bountiful natural resources. Parks and recreation are inextricably linked to the quality of life of our customers. To that end, SCE&G, a SCANA company, has donated thousands of acres for public use.” Because of its commitment to preserving the land and protecting water quality (while providing a consistent source of power), SCE&G has donated conservation easements to thousands of acres around the state. It is also very actively involved in wetlands and forestry management.
 
SCANA is always looking for new ways to save energy and protect the environment, especially in the area of recycling. Steel, copper, brass, coal ash, lamps, batteries, paper, wood chips, aluminum cans, toner cartridges, wood reels and pallets—you name it, a SCANA company probably recycles it. For example, SCE&G recycles more than 75 percent of the coal ash it produces and has identified several innovative ways to use it. In addition to saving millions of cubic yards of landfill space, coal ash is now being used with a cement and sand mixture for road repairs, in cement and ready-mix concrete, as filler in paints and plastics, and as structural fills for highway embankments, ramps and bridges.
 
SCE&G also burns used transformer and motor oil for energy recovery though its POWER (Power Originating With Energy Recovery) Program. Another ongoing recycling effort involves computer and other “white” paper. It takes two tons of trees to make one ton of paper. By recycling just one ton of paper, we are able to save 17 trees; 7,000 gallons of fresh water; 4,200 kilowatt hours of electricity; 60 pounds of air pollutants; and 81 cubic feet of land space.
 
The positive examples shown by SCE&G are replicated by every utility company that is a member of the Investment Recovery Association. In 2006, Ontario Power Generation, Inc. planted 326,000 trees in ecologically strategic locations around Ontario. Since the spring of 2000, OPG has planted 2.5 million native trees on more than 1,000 hectares. This effort will offset about 1 million tons of carbon dioxide over the lifetime of the trees. Sequestration carbon dioxide (CO2) is a contributing factor to global climate change. Carbon sequestration refers to the process of removing greenhouse gases from the atmosphere or an industrial process, and either converting the gases or holding them in storage. One way to sequester CO2 from the atmosphere is to plant trees. Trees turn CO2 into oxygen through photosynthesis.

 
Planting trees since 1995 … Association member DTE Energy has planted more than 20 million trees in Michigan. The Detroit-based utility funds an annual Urban Forestry Grant program administered by the Michigan Department of Natural Resources that has awarded grants to 95 Michigan communities since 1998 and is one of the leading partners in PowerTree Carbon Co., LLC, a voluntary consortium of 25 U.S. power companies engaged in six bottomland hardwood forest restoration projects in the lower Mississippi River Valley. At an international level, it partners with the Nature Conservancy and Programme for Belize to preserve an endangered Central American rain forest.
 

The list goes on and on. Another Association member that is intimately involved in progressive environmental practices is forestry products company Weyerhaeuser. According to Bruce Amundson, “It is a core policy at Weyerhaeuser to be responsible stewards of the environment wherever we do business. This entails practicing sustainable forestry; setting and meeting goals to reduce pollution; conserving natural resources and energy; and continually improving our environmental performance. Because of its importance, we hold our employees and leaders worldwide accountable for managing and operating our businesses in full compliance with all applicable environmental laws and meeting other external requirements to which the company commits.”

 

Weyerhaeuser expects business activities will be conducted to:

  • Employ environmental management systems to achieve company expectations.
  • Manage the environmental impact of our business activities and products, including innovative and advanced technology solutions.
  • Promote environmental laws, policies and regulations that are based on sound science and that incorporate incentive-based approaches to improve environmental performance.
  • Adopt company standards to protect the environment.
  • Manage forestlands for the sustainable production of wood while protecting water quality; fish and wildlife habitat; soil productivity; and cultural, historical and aesthetic values.
  • Audit compliance with environmental laws, policies, regulations and company requirements.
  • Resolve noncompliance conditions promptly, including when necessary, curtailing operations to protect human health and the environment.
  • Track and publicly report on our environmental performance.
The global reach of the companies that make up much of the membership of the Investment Recovery Association is substantial. But the activities of “Reduce, Reuse and Recycle” practiced daily by the IR professionals help to ensure that the environmental footprints left by these corporate giants will be tiny and gentle. 
 

Reprinted from ASSET 2.0, the Investment Recovery Business Journal, Vol. 2, 2007
© The Investment Recovery Association