Authors
Wiche, Pia; Granato, Danilo
Abstract
This study shows that sustainable management in companies is focused on end-of-life (EoL) management but is made without robust life cycle indicators. The data was obtained using a self-assessment based on (UNEP/SETAC Life Cycle Initiative, 2014) that evaluates the life cycle management (LCM) maturity of companies in four dimensions: Sustainability policies, Indicators, Supplier management and Use and EoL management. The self-assessment was applied to 800 Latin-American exporting companies from Chile, Colombia, Mexico, and Peru, revealing patterns of their LCM maturity. Results show that the starting point and the focus of the companies is on Use and EoL. While 30% of companies surveyed declare advanced Use and EoL management, only around 10% declared advanced management in the other three dimensions. However, Use and EoL management is not done using life cycle thinking: from the 30% of the companies declaring advanced EoL management, only 13% use indicators that cover the entire life cycle. The lack of life cycle thinking and indicators can lead to time, effort and resources invested that do not significantly improve the environmental and economic performance of the company. For example, although up to 80 to 90% of the environmental impacts may come from the upstream supply chain (McKinsey, 2016), 45% of the surveyed companies don’t do supplier management. Furthermore, waste and recycling are not a differentiator for exporters, yet it is the most common topic in sustainability policies (75%) in contrast with energy efficiency (53%) that can reduce costs, traceability (47%) which is a demand for exporters, fairtrade (50%) and climate change (34%) which are of international consumers interest, and water (36%) that can be a limiting factor in production. It is concluded that companies must incorporate more life cycle thinking and the use of indicators to orient decisions that have significative positive impact to the environment and their business.