creating more value with less impact

DEDICATED TO MAKING A DIFFERENCE

eco-efficiency

forewordIn 1991, we in the then Business Council for Sustainable Development werelooking for a single concept, perhaps a single word, to sum up the businessend of sustainable development.

Finding no such concept on the lexicographer s shelf, we decided we would have to launch an expression. After a contest and much agonizing,we came up with eco-efficiency. In simplest terms, it means creating moregoods and services with ever less use of resources, waste and pollution.

After only a decade, eco-efficiency is everywhere. I just now did a websearch on one search engine, which offered me 6,149 more web sites abouteco-efficiency. Today, universities teach it; consulting companies charge youto tell you how to do it; organizations like UNEP and the OECD holdconferences about it. This shows that the world very much needs theconcept of eco-efficiency. And I am pleased that it is an open, expanding,evolving concept.

Also, it is right and satisfactory that much of the opening up of the concepthas been at the hands of the World Business Council for SustainableDevelopment (WBCSD). This report, in an admirably few pages (in otherwords extremely eco-efficiently) wraps up a decade of Council work on thetopic. It shows how what began as a concept has become a sharp tool forbetter business performance. It is the eco-efficiency metrics approach –putting numbers on the concept – that makes it useful to business. In ayear-long pilot test of eco-efficiency indicators in 23 companies, it haspassed the acid test of business practicality.

Now eco-efficiency needs more government attention. The concept is soobvious you would think every company in the world would seize it andmilk it. Use less of the things you must buy – like resources – and produceless of the things you may get fined or sued for – like pollution – and youmust make more money! Correct? Not always. Not when those resourcesare perversely subsidized or that pollution goes unpunished. Thusgovernments need to encourage companies towards eco-efficiency – largelyby making it even more profitable.

Those of us who have developed the concept and developed and tested itsmetrics and found it profitable now have a great opportunity to pushgovernments to clamp down harder on waste and pollution and to cutharmful subsidies. This will make any sloppy competitors we may have lesscompetitive. The concept of win-win may be trite, but it still feels goodwhen it happens to you.

Stephan SchmidheinyChairman, Anova AGVice-chairman, WBCSD August 2000

introductionWith this publication, the WBCSD is releasing a new state-of-the-art declaration on eco-efficiency. It summarizes the evolution of the concept and presents eco-efficiency s achievements, both inside and outside business. Together with ourrecently released report, Measuring Eco-efficiency, this paper supersedes earlierWBCSD literature on eco-efficiency.

Already, the member companies of the WBCSD are applying the eco-efficiencyconcept in their business and many of the national BCSDs are running eco-efficiencyprograms for their constituencies. We hope this report will help spread and promotethe eco-efficiency brand even more widely.

People from many different countries and business sectors have contributed to theideas you will find in these pages. Continuous discussions, the sharing of learning,and the reporting of case histories all help to advance our understanding on eco-efficiency. Two WBCSD programs – Eco-efficiency Metrics & Reporting and theEuropean Eco-efficiency Initiative (EEEI) – have been especially influential in shapingour thinking over the last few years.

The EEEI is a program which the WBCSD conducts jointly with European Partners forthe Environment (EPE) in Brussels. EEEI became possible through financial supportoffered by Directorate General Enterprise of the European Commission and alsobenefited from participation and substantial input from more than 20 EEEI partnerorganizations across Europe. They, along with the many other participants at ourvarious events and workshops, have contributed to the development of our thinkingon eco-efficiency.

A team of champions from our member companies and from our local BCSDs and regional network partners reviewed the concept and drafts for this report. Weshould like to thank them for their feedback and suggestions for improvement.

Finally my thanks go to Markus Lehni, who conceptualized and wrote this report. Forthe last four years, he has been the brand manager for eco-efficiency at the WBCSDand has led our work programs on Eco-efficiency Metrics & Reporting, the EEEI, andSustainability through the Market, as well as several other of the WBCSD s activitiesrelated to environmental management issues, such as Sustainability Reporting andStakeholder Dialogue. He has actively disseminated our messages on eco-efficiency tomany constituencies and made it possible that a growing number of companies havenow adopted eco-efficiency and also that it is becoming seen as a valuable policy toolin many parts of the globe. We wish him well as he leaves the WBCSD.

I hope that you enjoy reading this report and that you are able to make good use ofthe ideas and suggestions it contains, so helping to bring about further much-neededprogress toward sustainable development.

Björn Stigson President, WBCSD October 2000

setting the scene

executive summary

CHAPTER 1

embracing eco-efficiencyA visionary idea is becoming mainstream

What does eco-efficiency mean? • Signposts to sustainability • How the idea grew •Answering the skeptics • Eco-efficiency in the broader context

CHAPTER 2

creating more value with less impactHow companies turn the challenge of sustainability into businessopportunities

Why eco-efficiency? The business rationale • What can companies do to improve? •Navigating for eco-efficient opportunities • Companies show their success • A guideto reporting performance • How companies measure and report eco-efficiency

CHAPTER 3

increasing quality of life without depletingour natural capitalHow governments can make eco-efficiency work for society

Why eco-efficiency? A macro-level rationale • Economy and quality of life up –Resource use and pollution down • The policy agenda for eco-efficiency • Howgovernments can measure eco-efficiency • National action for eco-efficiency • Eco-efficiency and macro-economic development

CHAPTER 4

with creativity and shared responsibilityOnward to an eco-efficient economy

The 12 key action points for an eco-efficient future

bibliography

about the WBCSD

contents

4

8

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22

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table of

executivesummary

4

Eco-efficiency is a managementphilosophy which encourages business tosearch for environmental improvementsthat yield parallel economic benefits. Itfocuses on business opportunities andallows companies to become moreenvironmentally responsible and moreprofitable. It fosters innovation andtherefore growth and competitiveness.

As defined by the WBCSD: Eco-efficiencyis achieved by the delivery ofcompetitively-priced goods and servicesthat satisfy human needs and bringquality of life, while progressivelyreducing ecological impacts and resourceintensity throughout the life-cycle to alevel at least in line with the earth sestimated carrying capacity. In short, itis concerned with creating more valuewith less impact.

It is important to understand that eco-efficiency is not limited simply to makingincremental efficiency improvements inexisting practices and habits. That ismuch too narrow a view. On thecontrary, eco-efficiency should stimulatecreativity and innovation in the search for

new ways of doing things. Nor is eco-efficiency limited to areas within acompany s boundaries, such as inmanufacturing and plant management.It is also valid for activities upstream anddownstream of a manufacturer s plantand involves the supply and productvalue-chains. Consequently, it can be agreat challenge to developmentengineers, purchasers, product portfoliomanagers, marketing specialists and evenfinance and control. Eco-efficiencyopportunities can emerge at any point inthe entire life-cycle of a product.

However, eco-efficiency is not sufficientby itself because it integrates only two ofsustainability s three elements, economicsand ecology, while leaving the third,social progress, outside its embrace. Therole of business is to satisfy human needsand it expects to be rewarded withprofits for doing so. But responsiblebusinesses also aim to improve quality oflife and this is very much part of what itmeans to become more sustainable. Thechallenge is to do this without increasingthe overall use of resources and havingan adverse effect on the environment.

KEY ELEMENTS OF THE ECO-EFFICIENCY CONCEPT

5

executive summary

Eco-efficiency is primarily a businessconcept because it talks the language ofbusiness. Put simply, it says thatbecoming more efficient makes goodbusiness sense. Eco-efficiency calls forbusinesses to achieve more value from lower inputs of materials andenergy and with reduced emissions. Itapplies throughout a company – tomarketing and product development as much as to manufacturing ordistribution. It is concerned with threebroad objectives:

! Reducing the consumptionof resources: This includesminimizing the use of energy,materials, water and land,enhancing recyclability andproduct durability, and closingmaterial loops.

" Reducing the impact onnature: This includes minimizingair emissions, water discharges,waste disposal and the dispersionof toxic substances, as well asfostering the sustainable use ofrenewable resources.

# Increasing product orservice value: This meansproviding more benefits tocustomers through productfunctionality, flexibility andmodularity, providing additionalservices and focusing on sellingthe functional needs thatcustomers actually want. Thisraises the possibility of thecustomer receiving the samefunctional need with fewermaterials and less resources.

Many companies have a fourthobjective, namely implementing anEnvironmental or SustainabilityManagement System that is integratedwith their existing businessmanagement systems in order to drivethe eco-efficiency approach. AnEnvironmental Management System(EMS) is a means of ensuring that all therisks and opportunities relating tosustainability are properly identified andefficiently managed.

Implementing eco-efficiency in acompany s business processes is first andforemost about navigating foropportunities. Such opportunities formore eco-efficiency can be found infour areas:

First, companies can re-engineertheir processes to reduce theconsumption of resources, reducepollution and avoid risks, while at thesame time saving costs. Second, bycooperating with other companies,many businesses have found creativeways to re-valorize their by-products. In striving for zero-waste or100%-product targets, they have foundthat the so-called waste from theirprocesses can have value for anothercompany. Thirdly, companies canbecome more eco-efficient by re-designing their products. Fourth,some innovative companies not only re-design a product, they find new waysof meeting customer needs. They workwith customers or other stakeholdergroups to re-think their marketsand re-shape demand and supplycompletely. Too many customersneeds today are met in a material- andenergy-intensive way. There aredifferent, and better, ways of satisfyingthose needs.

Eco-efficiency works not just in largetransnational companies, as many of theWBCSD member companies are, butalso in small and medium-sizeenterprises (SMEs). Likewise, it is asapplicable in developing countries andemerging economies as it is in theindustrialized nations.

The five examples described in thisreport illustrate the three dimensions ofeco-efficiency objectives and the fourstrands of eco-efficient opportunities.They also show the effect ofmanagement systems that support eco-efficient improvements.

The WBCSD has also explored ways ofmeasuring and reporting the overalleco-efficiency performance of acompany using eco-efficiency ratios.Ways of placing a measuring rodagainst eco-efficiency are detailed in aseparate WBCSD report, MeasuringEco-efficiency, in which the WBCSDputs forward a framework which can beused to measure progress towardeconomic and environmentalsustainability. The framework is flexibleenough to be widely applied and easilyinterpreted across the businessspectrum while providing a commonset of definitions, principles andindicators.

THE BUSINESS AGENDA FOR ECO-EFFICIENCY

6

Business cannot achieve eco-efficiencyalone. Progress requires going beyondthe internal actions of individualcompanies; it requires close cooperationamong the stakeholders. It needssociety to create an enabling frameworkwhich allows individual companies andwhole markets to become more eco-efficient. Governments have animportant role to play in creating theseconditions.

Already, several countries and regionshave enacted national and regionalaction plans aimed at fostering a moreeco-efficient and sustainable society.Arriving at a broad consensus onheadline indicators for eco-efficiencyand setting appropriate targets areamong the crucial elements that willhelp the transition to an eco-efficienteconomy.

Governments can implement a policywhich fosters economic growth andfavors a reduction in resource use andthe avoidance of pollution withincentives for eco-innovation. Suchpolicy measures to leverage businessinitiatives for more eco-efficiency caninclude elements such as:

Identifying and eliminatingperverse subsidies

Internalizing environmental costs

Shifting tax from labor and profitto resource use and pollution

Developing and implementingeconomic instruments

Promoting voluntary initiativesand negotiated agreements

The WBCSD, in co-operation withvarious multi-stakeholder organizationsand governmental bodies, isimplementing several projects todevelop eco-efficiency further as apolicy concept.

With European Partners for theEnvironment (EPE), supported from theEuropean Commission DirectorateGeneral for Enterprises, the WBCSDlaunched the European Eco-efficiencyInitiative (EEEI) in 1998. In its first twoyears, the initiative has promoted theunderstanding and use of eco-efficiencythroughout Europe and supported andfacilitated national initiatives, as well asthe creation of eco-efficiency actionplans. There is a focus made on Centraland Eastern European Countries (CEEC),several of which are in the process ofaccession to the European Union.

The WBCSD also has a long tradition ofcooperating with business organizationsin developing countries and emergingeconomies – in particular through itsRegional Network of 24 national BCSDsand partner organizations with a totalmembership of over 800 companies inLatin America, Southern Africa, East andSoutheast Asia and Eastern Europe.

Governments can quantify eco-efficiency as well and they can use it todrive the sustainability performance ofthe entire economy. Factors 4 and 10are eco-efficiency targets for theeconomy. By calling for increasedwelfare and reduced use of natureand for environmental space to bemore equally distributed, one is reallysetting macro-economic eco-efficiencyobjectives. Companies can, and must,contribute to attaining these objectivesbut they cannot do so alone.

The European Environment Agency(EEA) has adopted eco-efficiency ratioindicators for countries, asking for anabsolute and relative de-linking ofgrowth of welfare from the use ofnature . It intends to measure andcompare economic sectors andcountries with each other according totheir eco-efficiency status andimprovements. The agency hasannounced a set of Headline Indicators with the intention ofdeveloping a data basis for Europeancountries and economic sectors. Boththe EEA and the WBCSD are workingtoward matching headline indicators fornations and generally applicableindicators for corporate reporting.

Governments can use variousincentives to promote action towardprogress and support initiatives toadvance eco-efficiency – rewarding theleading-edge companies and puttingpressure on the laggards. Incentives toreward eco-efficiency will guideinnovation in the right direction andcreate new products and services. Eco-efficiency leads to more value fromfewer resources, through redesign ofproducts and services and through newsolutions. The more successfulcompanies will be those that setthemselves tough environmentaltargets and meet them with newtechnologies and practices.

THE POLITICAL AGENDA FOR ECO-EFFICIENCY

7

executive summary

Eco-efficiency can serve companies as ameans for developing and successfullyimplementing a business strategytoward sustainability. Such a strategywill have a strong focus ontechnological and social innovation,accountability and transparency, as wellas on cooperation with other parts ofsociety with a view to achieving the setobjectives.

Similar to the way it serves the privatesector, eco-efficiency can supportgovernments in deriving a nationalstrategy for sustainable development.Establishing framework conditionswhich foster innovation andtransparency and which allow sharingresponsibility among stakeholders willamplify eco-efficiency for the entireeconomy and deliver progress towardsustainability. The economy, togetherwith the quality of life, will continue togrow, while the use of resources andpollution will go down.

All parts of society share theresponsibility for progress. Business hasan important part to play and acceptsthe challenge. But similarly there is alsoa need for governments and civil societyto play their part. In this report, theWBCSD proposes 12 action pointswhich, if adopted by the variousstakeholder groups, will help move theworld forward toward an eco-efficientfuture.

THE WAY FORWARD TO AN ECO-EFFICIENT ECONOMY

embracingeco-efficiency

Eco-efficiency is a management philosophy that encourages business to

search for environmental improvements which yield parallel economic

benefits. It focuses on business opportunities and allows companies to

become more environmentally responsible and more profitable. It

fosters innovation and therefore growth and competitiveness.

Eco-efficiency is also a goal for society at large. It is recommended by

intergovernmental organizations and adopted by various countries as

their most promising policy concept for moving toward sustainable

development.

In this chapter, we explain how the WBCSD and other opinion leaders

have shaped eco-efficiency, how it fits into the broader context, and how

it relates to other approaches which work for progress toward

sustainability.

8

chapter 1

A visionary idea is becoming mainstream

9

resource intensity throughout thelife-cycle to a level at least in linewith the earth s estimatedcarrying capacity.

Many business leaders, inside andoutside the WBCSD, often express eco-efficiency as creating more value withless impact or doing more with less .Academic experts and practitioners termeco-efficiency the synthesis ofeconomic and environmental

efficiency in parallel , where the prefixeco stands for both economy andecology.

The OECD, has called eco-efficiencythe efficiency with which ecological

resources are used to meet humanneeds and defines it as a ratio of anoutput (the value of products andservices produced by a firm, sector oreconomy as a whole) divided by theinput (the sum of environmentalpressures generated by the firm, thesector or the economy). The EuropeanEnvironment Agency (EEA), whichintends to use eco-efficiency indicatorsto quantify progress towardsustainability on the macro-level, defineseco-efficiency as more welfare fromless nature and says it comes throughdecoupling resource use and pollutantrelease from economic development.

However, eco-efficiency is not limitedsimply to making incremental efficiencyimprovements in existing practices andhabits. That is much too narrow a view.On the contrary, eco-efficiency shouldstimulate creativity and innovation inthe search for new ways of doingthings. Nor is eco-efficiency limited toareas within a company s boundaries,such as in manufacturing and plantmanagement. It is also valid for activitiesupstream and downstream of amanufacturer s plant and involves the

Before the 1992 Earth Summit in Rio deJaneiro, business was asked to developits contribution, both in word and deed,to sustainable development. Businessresponded in Changing Course, writtenby Stephan Schmidheiny with theBusiness Council for SustainableDevelopment (BCSD). The book s aimwas to change the perception ofindustry as being part of the problem ofenvironmental degradation to the realityof its becoming part – a key part – of thesolution for sustainability and globaldevelopment.

The book sought to develop a conceptthat, by marrying environmental andeconomic improvements, would makea business out of the challenge ofsustainability . That concept was eco-efficiency. Since then, eco-efficiency hasbeen further shaped and developed bythe WBCSD and by many otherorganizations too. Importantly, it hasalso been demonstrated, throughhundreds of case examples, to work forcompanies of all sizes, in all industrialsectors and in all regions.

Changing Course defined eco-efficientcompanies as those which create evermore useful products and services – inother words, which add more value –while continuously reducing theirconsumption of resources and theirpollution.

At the first multi-stakeholder workshopon eco-efficiency in 1993 participantsagreed on the following workingdefinition:

Eco-efficiency is achieved by the delivery of competitively-priced goods and services thatsatisfy human needs and bringquality of life, while progressivelyreducing ecological impacts and

embracing eco-efficiency

Companies adopting eco-efficiency aremost often among the leaders in theirsector. As their success inevitably andconstantly provokes many others tofollow, eco-efficiency will finally growinto the mainstream.

FRANK W. BOSSHARDT

POLICY ADVISOR ANOVA HOLDING AG,

FOUNDER OF THE WBCSD ECO-EFFICIENCY

PROGRAM

WHAT DOES ECO-EFFICIENCY MEAN?

10

chapter 1

supply and product value-chains.Consequently, it can be a greatchallenge to development engineers,purchasers, product portfolio managers,marketing specialists and even financeand control. Eco-efficiency opportunitiescan emerge at any point in the entirelife-cycle of a product.

Companies can use eco-efficiency as anintegral cultural element in their policyor mission statements. They can also seteco-efficiency objectives for theirenvironmental or integratedmanagement systems. And it is a usefultool for monitoring and reportingperformance, and for helping the firm s communication and dialogue withits stakeholders.

Eco-efficiency opportunities are notlimited to big or internationalcompanies. Small and medium-size

enterprises (SMEs) and micro-businessescan also find and gain from eco-efficientsolutions. Similarly, service organizationscan apply the concept to the way theyprovide their services and, in doing so,help their clients to become more eco-efficient as well.

Through the work of the OECD, the USPresident s Council for SustainableDevelopment (PCSD), the EuropeanCommission (EC) and othergovernmental institutions, eco-efficiencyhas now become established as aconcept for policy on the macro-levelfor industrialized countries as well as fordeveloping, emerging and transitionaleconomies.

Improving eco-efficiency does not,however, lead automatically tosustainability. Simply improving inrelative terms (value per impact) may

still mean an overall increase in anactivity s impact and createunacceptable harm or irreversibledamage. The EEA points out thatabsolute reductions in the use of

nature, and associated environmentalpressure, may be necessary to getwithin the earth s carrying capacities, so that both absolute and relative de-linking between growth of welfare anduse of nature are needed .

The WBCSD and its member companiesare continuing to work on developingthe eco-efficiency concept and areactively encouraging more businessleaders to implement it in theirorganizations and more policy makersto adopt it too. Eco-efficiency is, in fact,work in progress and will continue to be so because it is in essence adynamic rather than a static process.

As the horizontal arrows in thesignpost diagram show, companiesinitially dealt with pollution problemsthrough Compliance Management.Next, they moved toward proactivelypreventing pollution via Cleaner

SIGNPOSTS TO SUSTAINABILITY

Production. Eco-efficiency then began tocontribute because, for the first time, itestablished the link betweenenvironmental improvements andeconomic benefits. The next step isResponsible Entrepreneurship through

which the private sector aims tobalance all three pillars of sustainability(social justice, economic prosperity andecological balance). A comprehensiveapproach to sustainability managementby business should encompass all fourof the above.

Business has used a number of tools toimplement these concepts (see bullets),including Environment Health & Safety (EHS) auditing, the BusinessCharter for Sustainable Development of the International Chamber ofCommerce (ICC), and theEnvironmental Management System(EMS) standards, which originate froman idea of the WBCSD. Today,management s focus is on developingand implementing a business strategywhich embraces the imperative ofsustainability.

11

embracing eco-efficiency

Meanwhile, there has been majorprogress on the policy agenda as well.First was the idea of SustainableDevelopment (see first oval in thediagram), which then became a moreconcrete action program with Agenda21. Next we could list the so-calledFactor X concept, asking for

quantified targets in improving eco-efficiency and reducing impact acrossthe entire economy. A fourth step maybe the notion of the EnvironmentalFootprint which argues that the spaceavailable for human activity is limitedand that it should be distributed moreequitably.

After the days of Command and ControlLegislation, policy makers haveresponded in a number of ways, notablyby introducing more effective Co-regulatory Agreements and EconomicIncentives to complement, or evenreplace, their former reliance onlegislation (see vertical arrows).

HOW THE IDEA GREW

In 1991, when the BCSD first used theterm eco-efficiency , it was hard toforesee how important the conceptwould become. Yet, in less than tenyears, it has moved into the mainstreamand migrated from corporateboardrooms to policy arenas.

The term eco-efficiency was actually first used by the Basel based researchersSchaltegger and Sturm in 1990. But theidea that preventing pollution andavoiding waste pays off financiallypredated this by at least 15 years. TheUS-based consumer goods manufacturer,3M, initiated its Pollution Prevention Pays(3P) program in 1975, achieving morethan US$ 800 million in cumulative first-year savings from more than 4,000 3P projects and Dow Chemicals not less successfully followed with WasteReduction Always Pays (WRAP).

Through Changing Course, StephanSchmidheiny and the BCSD took up thisconcept and launched it as eco-efficiencyworldwide. The WBCSD has sincemarketed eco-efficiency as its centralbusiness concept for bringing aboutcorporate progress toward sustainabilityand has helped it become adopted bynumerous companies, firstly in Europeand in North and Latin America, then onother continents.

Initially, the BCSD invited leading businesspeople and experts from stakeholders,

academia and governments to developthe concept in a series of eco-efficiencyworkshops. The major drivers in that earlyphase were forward-looking managersand thinkers in 3M and Dow. Additionalcompanies then contributed case studiesdescribing the practical application of eco-efficiency and their achievements. It wasthe constant efforts of a team of leaderswithin Dow Chemicals and 3M that madeeco-efficiency achieve a break-though froma brilliant idea to a workable concept. Onlya few years after the successful launch ofthe concept, the WBCSD was able topresent all the achievements business hadmade so far in Eco-efficiency – The businesslink to sustainable development, a full eco-efficiency textbook authored by Livio DeSimone and Frank Popoff, as well as inSignals of Change the progress report tothe UN s Rio+5 conference.

In the meantime, the focus has movedfrom the operational aspects of eco-efficiency toward eco-innovation anddesign for environment, spearheaded byDriving Eco-innovation from ClaudeFussler of Dow Europe. This has openedup even bigger opportunities forcompanies to advance their eco-efficiency performance. For manycompanies, the main effects on theenvironment actually occurred outsidetheir fence-lines – either upstream in theraw material generation and supplierprocessing phases, or down-stream inthe product use or disposal phases.

The WBCSD has also directed its messageat the financial markets, pressing them tobecome more aware of the value of eco-efficiency. The results of the WBCSD swork making the linkage betweenenvironmental performance and thebottom line were published in 1997 in itsreport Environmental Performance andShareholder Value.

Guided by the business edict: Onlywhat s measured actually gets done ,WBCSD has explored a framework formeasuring eco-efficiency. It hasdeveloped the elements for a commonapproach to reporting corporateperformance, a list of generally applicablevalue and environmental indicators and away of expressing the performance witheco-efficiency ratios. With this work theWBCSD has compiled, for the first time,specific practical guidance to companieson how to implement eco-efficiency inpractice by presenting a tool formeasuring eco-efficiency and reportingperformance. The results of this workwere published in the report MeasuringEco-efficiency in June 2000.

The WBCSD also concluded that thehitherto neglected consumption side ofthe coin needed more attention. It hastherefore been working, through itsSustainability through the Market (STM)program, towards the adoption of abusiness-based approach to sustainableconsumption. WBCSD member

12

chapter 1

companies are aiming to make marketseco-efficient, for example by offering lessresource-intensive service solutionsinstead of bulky products; by enteringinto alliances with stakeholder groups; orby providing the information consumersneed to help them buy more responsibly.

Business has also pushed eco-efficiency asa policy concept and has met with somesuccess. For example, urged by its privatesector members, the US President sCouncil for Sustainable Development(PCSD) first recommended eco-efficiencyas a useful approach for government

action. The OECD s Committee onSustainable Development, again led bybusiness leaders, adopted eco-efficiencyas the most promising concept forprogress toward sustainability and hasengaged in a major work program onthe topic. Or again, the CanadianNational Round Table on theEnvironment and the Economy (NRTEE),an institutionalized multi-stakeholderorganization sponsored by the Canadiangovernment, has been involved in severalprojects on eco-efficiency indicators andfiscal reform. For its part, the EuropeanCommission (EC) refers to eco-efficiency

in its policy process, while the EuropeanEnvironment Agency (EEA) is using theconcept for defining and reporting onmacro-economic indicators.

Overall, the WBCSD sees eco-efficiency asmoving from what could be called aproprietary brand to something akin to acommon property . A growing numberof companies, organizations and govern-ments are using and interpreting it fortheir own projects and benefit. This, webelieve, will put eco-efficiency firmly intothe corporate and political mainstream.

What eco-efficiency is not

Eco-efficiency has never been meant to

be an all-inclusive panacea. Indeed, it is

important to remember that eco-

efficiency is…

● Not a take-it-or-leave-it approach● Not an either-or (but much more

a both-and-and ) approach● Not a solution to all the problems

on the way to sustainability● Not a rigid framework● Not anyone s single strategy● Not a management system ● Not a certifiable standard● Not a reporting format● Not a cook-book with recipes● Not something one can buy off the

shelf● Not an assurance against failure

ANSWERING THE SKEPTICS

But eco-efficiency has not yet woneveryone over.

Some claim that a relative increase incompany eco-efficiency is not enough.Instead they demand an absolutecutback in resource consumption. Thismisses a key point about eco-efficiency –it is not limited to achieving relativeimprovements in a company s use ofresources and its prevention of pollution.It is much more about innovation andthe need for change toward functionalneeds and service intensity, to contributeto de-coupling growth from resources.

Others call for eco-effectivenessrather than efficiency, stressing theimportance of innovation. We believethey are right to focus on going beyondsimply improving existing processes. Itdoes this by changing industrialprocesses, creating new products andchanging and influencing markets withnew ideas and with new rules.

There is also the claim that using fewerresources per unit of production fails todeliver progress toward sustainability ifthe number of units continues toincrease faster than the gains in

resource productivity. Critics maintainthat incremental improvements inefficiency distract attention from theinnovation needed to achieve realimprovements and changes in behavior.Arguing that the environmentalfootprint of the rich is too big, theydemand sufficiency instead of efficiency.The WBCSD accepts the need to reducepollution and resource depletion butdoes not agree that reducing livingstandards will achieve a better-balancedworld. In our view, it is more importantto opt for a different way of living thatcan offer a better quality of life andmore welfare for all, while limiting theuse of resource and pollution toacceptable levels.

It is also claimed that eco-efficiency willnot work in poor economies becausepreventing pollution is too costly andrequires legal enforcement andsubstantial financial help. The WBCSDhas demonstrated that this view ismistaken. We have shown that eco-efficiency does work in developingcountries and countries in transition. Inparticular, companies can achieve bigimprovements in areas where resourceswere previously not used efficiently.

However, profits from resource efficiencyare limited. Only when externalities areinternalized, and when resources andpollution are priced properly, willefficiency improvements provide a fullpay-off. Governments must thereforeensure that the external costs of resourceuse are internalized into the respectiveprices, that perverse subsidies areeliminated and that those who avoidpollution are rewarded.

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embracing eco-efficiency

Eco-efficiency is a key concept forhelping companies, individuals,governments and other organizations tobecome more sustainable. As we haveseen earlier, it brings together theessential ingredients – economic andecological progress – necessary foreconomic prosperity while usingresources more efficiently and reducingemissions of environmentally harmfulsubstances. Eco-efficiency was called theshear zone between the economic andenvironmental bottom lines.

However, eco-efficiency is not sufficientby itself because it integrates only twoof sustainability s three elements,economy and ecology, while leaving thethird, social progress, outside itsembrace. The role of business is tosatisfy human needs: it expects to berewarded with profits for doing so. Butresponsible businesses also aim toimprove quality of life and this is verymuch part of what it means to becomemore sustainable. The challenge is to dothis without increasing the overall use ofresources and having an adverse effecton the environment.

Sustainability will only be achieved bybusiness working together withgovernments and external stakeholderssuch as suppliers, customers, neighborsand NGO, sharing the responsibility.Governments, for example, cancontribute by formulating economicand industrial policies which encourageeco-efficiency in business as well asreduce energy and resource usethroughout the economy.

Business cannot, by itself, ensure equalopportunities for society as a whole, norensure that the use of natural resourcesis in line with the earth s carryingcapacity . But it can contribute to thesegoals through eco-efficiency andresponsible entrepreneurship.

As a macro-level concept, eco-efficiencyembraces the critical issues upfront. Thetargets Factor 4 and Factor 10 areeco-efficiency targets. Factor 4 meansDoubling income with divided resource

use means more value with reducedimpact for the entire economy, in otherwords: eco-efficiency. Factor 10 means atenfold increase in resource efficiency inthe developed economies, whilereducing the total use of naturalresources globally to keep within thelimits of the carrying capacity. Factor 10is asking for an absolute – not simply arelative – de-linking of economic growthand the use of natural resources.

For many, eco-efficiency is one amongmany approaches with a similarobjective: that of making business andthe economy more sustainable. Yet eco-efficiency has a number of uniquecharacteristics which differentiate itfrom, and add value to, other concepts.

For example, businesses implementingEnvironmental Management Systems(EMSs) will benefit from applying theproactive and opportunity-basedmindset which is central to adoptingeco-efficiency. By looking for morebottom-line gains they will ensure thattheir EMSs really do lead to continuous

improvement. EMS standards such asEMAS and ISO 14000ff, which WBCSDhelped to create, can play an importantrole supporting companies toward eco-efficiency and sustainability but must beseen as a means to an end, not the enditself. EMSs can ensure that risks andopportunities are identified andmanaged systematically and efficiently,and they offer organizations – businessesand others – the tools and instrumentsto manage and communicate effectivelytheir performance and achievements.

UNEP s Cleaner Production Programmehas much in common with eco-efficiency. Both concepts were shapedmore or less in parallel and continue tobe further developed through theexchange of know-how and experience.Far from being in conflict, they aremutually reinforcing. Indeed, theWBCSD has a close partnership withUNEP, cooperating with it in variousfields and co-publishing with it tworeports on Cleaner Production and Eco-efficiency.

In summary, eco-efficiency is a conceptwith much to offer for many. It can beused for a variety of purposes andapplied on various levels.

ECO-EFFICIENCY IN THE BROADER CONTEXT

Eco-efficiency is primarily a business concept because it talks the

language of business. Put simply, it says that becoming more efficient

makes good business sense.

Eco-efficiency has moved from being concerned with making resource

savings and preventing pollution in manufacturing industries to

becoming a driver for innovation and competitiveness in all types of

companies. Financial markets also start recognizing the value of eco-

efficiency because there is growing evidence that eco-efficient

companies produce a better performance financially.

In this chapter we explain what companies can do to make themselves

more eco-efficient – where they can find the opportunities to improve.

Successful case examples from several different areas show how eco-

efficiency works in practice. The way companies measure and report

their overall performance in eco-efficiency completes the picture.

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How companies turn the challenge ofsustainability into business opportunities

creatingmore value with less impact

15

The business rationale for eco-efficiencyis straightforward: it makes goodbusiness sense. Being efficient is alwaysa high priority for every company. But ifit includes creating economic value andreducing environmental impact andresource use at the same time, the valueadded becomes even more significant.

The business case for eco-efficiencyapplies to every area of activity within acompany – from eliminating risks andfinding additional savings through toidentifying opportunities and realizingthem in the marketplace.

Financial markets have also started to lookat these aspects of business performance.

Forward-looking analysts are selecting thesustainability pioneers and leadersbecause they know that the companiesthat have developed a sustainabilitystrategy and have implemented eco-efficiency as a business concept out-perform their competitors significantly.

The WBCSD has led the way in makingmore visible the link between eco-efficiency excellence and the value of acompany for its stakeholders. Its 1997report, Environmental Performance andShareholder Value, deals comprehensivelywith this subject. That work has beenreinforced by more recent approachessuch as the Dow Jones SustainabilityGroup Index (DJSGI).

Bearing in mind the nature of ourbusinesses, we founded the long-termperformance strategy for Suez Lyonnaisedes Eaux on eco-efficiency. This conceptlinks competitiveness and value creationto protecting the world s equilibriumand enhancing our understanding ofenvironmental challenges. Sustainablegrowth must thus be part of businessstrategy, integrated in all decision-making processes, and demonstratedthrough concrete action.

THIERRY CHAMBOLLE

SENIOR VICE PRESIDENT ENVIRONMENT

AND TECHNOLOGY, SUEZ LYONNAISE DES EAUX

Our experience shows thatsustainability does not require sacrificeor deprivation. Rather it meansexploiting the latest technologies,reducing waste, reusing resources,adopting lean production and betterlogistics practices and making soundinvestments in efficient productivecapacity. In fact, eco-efficiency andsustainability are not free; for a marketleader they are actually more than freebecause they provide a real competitiveadvantage.

PASQUALE PISTORIO,

PRESIDENT AND CHIEF EXECUTIVE OFFICER,

STMICROELECTRONICS

Our business challenge is to delivercompetitive economic value, and at thesame time operate in an environmentallysound and socially responsible manner. I strongly believe that excellence inenvironmental approach and solutions,in social responsibility and in economicperformance are complementary, andnot conflicting. In periods withsubstantial and rapid businessrestructuring, the need to providepractical proof of this complementarityis becoming increasingly important.

EGIL MYKLEBUST

PRESIDENT AND CEO, NORSK HYDRO

creating more value with less impact

WHY ECO-EFFICIENCY? THE BUSINESS RATIONALE

Eco-efficiency calls for businesses toachieve more value from lower inputs ofmaterials and energy and with reducedemissions. It applies throughout acompany, to marketing and productdevelopment as much as tomanufacturing or distribution.

The WBCSD has identified sevenelements that businesses can use toimprove their eco-efficiency:

Reduce material intensity

Reduce energy intensity

Reduce dispersion of toxicsubstances

Enhance recyclability

Maximize use of renewables

Extend product durability

Increase service intensity

These seven elements may be thoughtof as being concerned with three broadobjectives:

1) Reducing the consumption ofresources: This includes minimizingthe use of energy, materials, water andland, enhancing recyclability andproduct durability, and closing materialloops.

2) Reducing the impact on nature:This includes minimizing air emissions,water discharges, waste disposal andthe dispersion of toxic substances, aswell as fostering the sustainable use ofrenewable resources.

3) Increasing product or servicevalue: This means providing morebenefits to customers through productfunctionality, flexibility and modularity,providing additional services (such asmaintenance, upgrading and exchangeservices) and focusing on selling thefunctional needs that customers actually

WHAT CAN COMPANIES DO TO IMPROVE?

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chapter 2

want. Selling a service instead of theproduct itself raises the possibility of thecustomer receiving the same functionalneed with fewer materials and lessresources. It also improves the prospectsof closing material loops becauseresponsibility and ownership, andtherefore concern for efficient use,remain with the service provider.

Many companies have a fourthobjective, namely implementing an Environmental orSustainability ManagementSystem that is integrated with theirexisting business management systemsin order to drive the eco-efficiencyapproach. An EnvironmentalManagement System (EMS) is a

means of ensuring that all the risks and opportunities relating tosustainability are properly identifiedand efficiently managed. ISO 14000ffand EMAS are both state-of-the-artapproaches to achieving this. Otherstrategic tools, such as BalancedScorecard and Value BasedManagement, can also be used.

NAVIGATING FOR ECO-EFFICIENT OPPORTUNITIES

The diagram below is a view mapfor eco-efficiency. It can help companiesto identify where the opportunities canbe found and who, inside and outsidethe company, will be involved inexploiting them. It suggests that thereare four areas that provide opportunitiesfor more eco-efficiency:

First, companies can re-engineer theirprocesses to reduce the consumptionof resources, reduce pollution and avoidrisks, while at the same time savingcosts. Experience shows there aremanifold possibilities, some straight-forward, some less obvious. Invariably,the whole workforce has to be involvedin identifying opportunities and inmaking the changes necessary to seizethem. Process changes may also berelated to delivery or to supplier

operations, as well as to distribution,customer use or disposal.

Second, by cooperating with othercompanies, many businesses have foundcreative ways to re-valorize their by-products. In striving for zero-waste or100%-product targets, they have foundthat the so-called waste from theirprocesses can have value for anothercompany. Sometimes, in the chemicalindustry for example, by-products haveeven become a real cash-generatingproduct of a production process. Zero-waste targets and by-product synergieslead to the more effective use of theresources in a process and create anadditional cash benefit. In short, theyare eco-efficient because they allowcreating more value with fewerresources.

Product designers and procurementmanagers play a key role in a company.Their influence is not only crucial toproduct functionality and price but alsohas a big effect on costs and theenvironmental impact in production,product maintenance and disposal. Thistherefore suggests the third area foreco-efficiency opportunities: companiescan become more eco-efficient by re-designing their products. Productsdesigned to ecological design rules arefrequently cheaper to produce and use.They are smaller and simpler in theirdesign. They include a smaller variety ofmaterials and are easier to disassemblefor recycling. Often, too, theyencompass higher functionality, betterserviceability and easier upgradeability.Because they can provide a higher valuefor their users, while the environmentalinfluence related to their use isminimized, they are eco-efficientproducts.

Fourth, some innovative companies notonly re-design a product, they find newways of meeting customer needs. Theywork with customers or otherstakeholder groups to re-think theirmarkets and re-shape demand andsupply completely. Too manycustomers needs today are met in amaterial- and energy-intensive way.There are different, and better, ways ofsatisfying those needs. For example, it ispossible that by providing a service

17

creating more value with less impact

instead of selling the product, theoverall material or energy intensity maybe reduced. This also opens upopportunities for new economic growthand higher profitability.

As the diagram makes clear, alldepartments within a company cancontribute to increasing eco-efficiency:operations, procurement, R&D, sales,marketing and management all havetheir part to play. Many companies,

recognizing this, have made eco-efficiency part of their overall businessstrategy. They have realized that key eco-efficient opportunities lie not just in theirmanufacturing but also along the entiresupply chain as well as in the use of theirproduct and services. Eco-efficiency forthem has become a major driver ofinnovation and progress, a vehicle thathelps them meet the economic andenvironmental targets they had set.

The WBCSD believes that it is of vitalimportance that top management buysinto the concept of eco-efficiency.Those corporations where eco-efficiencyhas entered into the CEO s agendabecome able to make real progress.Their performance path is not limited tosome incremental improvements inspecified aspects. Instead, they begin toleapfrog eco-efficiency with innovativeproducts, new services and a changedbusiness strategy toward sustainability.

COMPANIES SHOW THEIR SUCCESSES

Eco-efficiency works not only in largetransnational companies, as many of theWBCSD member companies are, butalso in small and medium-sizeenterprises (SMEs), as well as indeveloping countries, emergingeconomies and the industrializednations alike.

In this section we present five examplesof how eco-efficiency works in practice.Space limitations mean that only briefsummaries can be provided. Moredetailed cases, together with the criteriafor what makes a good eco-efficiencycase study, can be found in thecollection of eco-efficiency case studieson the WBCSD website(www.wbcsd.org).

The examples illustrate the threedimensions of eco-efficiency objectivesand the four strands of eco-efficientopportunities. They also show the effectof management systems that supporteco-efficient improvements.

Lura Group, member of BCSD Croatia,is the leading dairy company inCroatia. In 1997, its managementdecided to tackle waste-water from thecompany s Sirela production plantwhich was discharged into the town ssewer system and treated together withmunicipal waste-water. Lura set up aproject to purify the wastewater in aclosed-circle system, then treat thesludge and, rather than pay to disposeof it, turn it into commercial compost.The purification process now producesabout seven tons of sludge a day. Thehigh-quality compost is a mixture ofthe residual sludge, unripe manure,bark and sawdust.

The investment in eco-efficiency turnedout to be good business. The benefitsare a significantly improved environ-mental performance of the plant, yearlysavings on waste-water pollution feesthat paid back the investments inequipment within 18 months, and anexpansion of the business. The endresult? New earnings, new partnershipsand new employment possibilities.

Source: Damir Brlek at Lura d.d. Zagreb andWBCSD; Eco-efficiency case study collection,www.wbcsd.org, 1998

The only thing not re-invented isthe wheel. That s how Volkswagenheadlines its report on the Lupo 3LTDI passenger car. A completely newcar, the Lupo was brought to marketin 1999, with a fuel consumption ofless than 3 liters per 100 kilometers.It was designed for eco-efficiencyand embodies many technicalinnovations. Indeed, VW says that itsperformance is optimizedthroughout its entire life-cycle.

It is not just that the Lupo s enginehas low-emissions and low fuelconsumption; the cars themselvesare built from recycled materialsusing production methods whichminimize waste and emissions. Andwhen the car reaches the end of itsuseful life, the Lupo s design alsosupports the segregation of materialsin the dismantling and recyclingprocesses. Moreover, says VW, thecar can deliver what customersdemand: good driving performanceat a remarkably low price.

Source: Christiane von Finckenstein, VolkswagenAG, Wolfsburg and Volkswagen EnvironmentalReport, www.volkswagen.de, 1999

Volkswagen Lupo, Germany:Designed for eco-efficiency

Lura, Croatia:By-products yield business value

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chapter 2

Since 1997, the Swiss Federal Railways (SBB) has

successfully cooperated with the car-sharing company

Mobility. Car-sharing is an innovative service offered to

people who frequently want to use a car without

buying their own. Mobility cars are parked at pre-

defined places, ready for use by registered clients for a

pre-announced period of time. The sharing concept

allows people to benefit from using a car in a more

efficient way than they would by owning a car

themselves. Furthermore, Mobility clients can always

get the right car at the right size and for the purpose

they need.

Mobility has more than 1,300 cars in 330 communities

throughout Switzerland, 250 of them at railway

stations. The combined offer with SBB is a step forward

in eco-efficient service value. It allows railway

passengers to get dedicated mobility options at the

arrival point of their journey almost everywhere in

Switzerland. SBB offers this combined mobility services

at attractive tariffs and provides financial incentives to

its customers to use the car-sharing service.

Car-sharing members measurably change their travel

behavior. More than two-thirds of their travel is by

public transport. Per car-sharing client, the percentage

of rail travel grows on average by more than 2,000

km. Active car-sharers consume less than half the

amount of fuel than they did when they drove their

own car, and the overall distance they travel declines.

Mobility today has more than 34,000 clients, of whom

more than 12,000 are frequent customers of SBB and

benefit from the priority conditions of the alliance.

Source: Séverine Wermeille, SBB AG Bern and SBB AG EnvironmentalReport, 1999

The Italian diary producer, Parmalat, is the market

leader for milk of UHT quality on a global level. In

Setúbal, Southern Portugal, Parmalat is a local

producer and distributor of various milk products and

fruit juices. The facility has recently certified its quality

and environmental management system according to

ISO 9002 and 14001.

Parmalet participated – together with nine other

companies from the Setúbal area – in a local eco-

efficiency program that was conducted by

INETI/CENDES as part of the WBCSD s European Eco-

efficiency Initiative (EEEI). Parmalat, such as the other

participating companies, systematically analyzed eco-

efficiency opportunities in its operations and

implemented measures for water management,

wastewater reduction and raw material and energy

losses with great success. More than 80 opportunities

for cleaner production in production, maintenance

and quality control were identified, leading to 58

concrete measures for adapting its processes and

changing its operating practices.

Parmalat Portugal could reduce the quantity of raw

material lost from 2 percent to 1 percent. It has also

cut the amount of water used by 4 cubic meters per

cubic meter of product processed, and the amount of

wastewater by 2.5 m3/m3. The annual savings have

exceeded the investment by more than three times.

The overall program in the ten companies (Parmalat

Portugal, ABB Alstom Power, Tintas HEMPEL, Merloni

Electrodomésticos, Moinhos de Trigo de Setúbal,

Refrige, Rieter, Salus, SECIL Betão, SECIL Prébetão) has

clearly demonstrated the usefulness of the eco-

efficiency concept, not only for the companies

themselves (micro level) but also as a contribution to

local sustainable development (meso level).

Source: Constança Peneda (constanca.peneda@mail.ineti.pt),INETI/CENDES Lisboa, 1999

Parmalat, Portugal: Eco-efficiency measures with excellent saving

Car sharing in Switzerland: A customer service with higher resourceefficiency in mind

19

creating more value with less impact

Illuminating though the above examplesare, at the end of the day they are nomore than that – examples. While theyillustrate how eco-efficiency works, theycan give only a limited picture of theperformance of an organization or abusiness.

This is why the WBCSD has exploredways of measuring and reporting theoverall eco-efficiency performance of acompany with eco-efficiency ratios.Ways of placing a measuring rod against eco-efficiency are detailed in a separateWBCSD report, Measuring Eco-efficiency –A guide to reporting companyperformance, published in June 2000.We therefore provide only a briefsummary of its recommendations here.

In that report, the WBCSD puts forwarda framework which can be used tomeasure progress toward economic andenvironmental sustainability. Theframework is flexible enough to bewidely used and easily interpretedacross the business spectrum whileproviding a common set of definitions,principles and indicators.

The concept defines two types ofindicator to help companies keep theirreporting system flexible. This permitsmore efficient decision-making internallyand fulfills stakeholder requirements.First, a small number of indicators wereidentified as being valid for virtually allbusinesses. These were calledgenerally applicable indicators.They are widely relevant and subject toa common measurement approach.However, they may not be of equalvalue or importance to all companies.For each one, there must be generalinternational agreement that: theindicator is related to a globalenvironmental concern or businessvalue; it is relevant and meaningful to

virtually all businesses; and there aremethods for measurement establishedand definitions accepted globally.

But many indicators are not applicableto all companies. So a second group ofindicators was devised to be used byindividual companies to fit theirparticular context. These are termedbusiness specific indicators. Eachcompany must therefore evaluate itsown business to determine whatbusiness specific indicators should applyto it and would be useful tomanagement and external stakeholders,in addition of course to the generallyapplicable indicators.

Various efforts are also being made toharmonize sectoral indicators. TheEuropean Chemicals ManufacturersAssociation (CEFIC) has taken aleadership role in asking its members forharmonized reports using agreedindicators. In other sectors, such asbanking, Swiss and German firms areworking on defining indicators tomeasure the eco-efficiency performanceof banking services. Other sectors arefollowing suit. The WBCSD, which hasstarted sectoral projects for the mining,cement and transportation industries,wants those projects to work towardsdefining eco-efficiency indicators thatare relevant to each sector.

Eco-efficiency brings together the twoeco-dimensions of economy and ecologyto relate product or service value toenvironmental influence. Eco-efficiencymay be represented by the followingratio:

Product or service value

Environmental influence

Carvajal S.A. in Cali, Colombia,member of BCSD Columbia, isengaged in several main businessareas in partnership withindependent companies, amongthem printing services. For decades,the graphic arts industry has useddiverse solvents and cleaning agents.Although they have excellentcleansing properties, they are alsoinjurious to health, detrimental tothe environment and highlyflammable or even explosive.

For several years, Carvajal hasworked successfully on substitutingthese traditional solvents with othersthat are equally effective but lessdangerous and environmentallyharmful. Today, the company haspractically eliminated toxic solventsfrom its printing processes. At thesame time, it has cut backsignificantly on spending oncleaning agents – total consumptionhas been reduced by roughly 60 percent water-based solvents,used instead of the formerflammable agents, have reducedenvironmental impact of toxic by-products by 75 percent. That sequivalent to releasing up to 130 tons fewer pollutants annually.

Carvajal has shown thatenvironmentally benign solutions donot necessarily conflict with costeffectiveness and that it is possible toreduce a company s environmentalimpact while also cutting its costsand improving its operatingefficiency.

Source: Carmen Elena Orozco, Carvajal, Calíand WBCSD Eco-efficiency case studycollection, www.wbcsd.org, 1998

A GUIDE TO MEASURING ECO-EFFICIENCYCarvajal, Colombia: Impact reduction withremarkable benefits

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chapter 2

There are numerous ways by which eco-efficiency can be calculated using thisbasic ratio. Both product or service valueand environmental influence includemany different indicators that cannot bemerged into one single number.Companies will need to choose eco-efficiency ratios that best serve theirprocess for communication and decision-making. Specific calculations will dependupon the needs of individual decision-makers. Value and environmental

influence can also be measured for diffe-rent entities, such as production lines,manufacturing sites, or entire corpora-tions, as well as for single products,market segments or entire economies. Inthe same way, eco-efficiency ratios canbe calculated and used for many of theseentities. The same indicator may not besuitable for each one.

The WBCSD recommends companiesintegrate eco-efficiency information into

their overall decision-making andcommunications processes. Internally, itshould be part of routine managementsystems. Externally, eco-efficiencyindicators could be provided incorporate environment or sustainabilityreports as one of the integratingelements between the three pillars ofsustainability. They could also beincluded in existing financial reports asan extension to pure financial reporting.

Five elements for corporate eco-efficiency reports

The WBCSD proposes the following five

elements for inclusion in any report on a

company s eco-efficiency:

Organization profile This will provide a

context for the eco-efficiency

information. It should include the

number of employees; the business

segments involved, primary products and

major changes in the structure of the

company.

Value profile Indicators from the

value portion of the WBCSD framework,

including financial information, the

quantity of products, or functional

indicators for specific products.

Environmental profile This will include

generally applicable indicators of

environmental influence as well as

business-specific indicators relating to

product/service creation and use.

Eco-efficiency ratios In addition to

providing the basic numerator and

denominator data for estimating eco-

efficiency, companies may also wish to

provide calculations of the eco-efficiency

indicators that they consider most relevant

and meaningful for their business.

Methodological information This will

describe the approach used to select

indicators, data collection methodologies

and any limitations on use of the data.

HOW COMPANIES CAN REPORT THEIR PERFORMANCE

Reporting, both internally tomanagement and externally tostakeholders, is a key element of aneffective management system.Performance reports on the key relevantaspects – financial, environmental orsocial – facilitate management decision-making. Preparing a report for thepublic can have the further benefit ofscreening performance assessment anddata collection procedures and it oftentriggers a company to set improvementtargets. The WBCSD has largely beeninvolved with stakeholders indeveloping guidance on sustainabilityperformance reporting and continuesworking on the subject. A new projecton Sustainability Reporting was justrecently initiated.

The Sustainability Reporting Guidelines,published in June 2000 by the GlobalReporting Initiative (GRI), reflect thestatus of that work in progress. Theguidelines ask organizations to reporton their environmental, economic andsocial performance. They also ask for astatement by top management and forinformation to be provided on thereporting organization, its vision,strategy, policies, organizationalstructures and management systemswith respect to sustainability. A GRI

report is not meant to be the sum ofthree independent reports on theenvironmental, economic and socialelements of sustainability. Instead, itasks for information that includescrosscutting indicators that build abridge between the three elements aswell as systemic indicators that makethe link between micro-level companyperformance and macro-level objectivesand biophysical limits.

By bridging the gap betweenenvironmental and economicsustainability, eco-efficiency forms acore element of performance reportingon sustainability. Eco-efficiency ratioindicators allow companies tocharacterize this important shear zonemore effectively and to assess theirperformance relative to it. This makes itimportant that companies provide theireco-efficiency indicators together with

21

creating more value with less impact

absolute value and environmentalinfluence data. Users of the data canthen assess the company s performanceand progress in relation to otherplayers, as well as estimate therelevance of value and impact inrelation to the company s overallimpact.

Twenty-three WBCSD membercompanies have taken part in practicalpilot exercises using eco-efficiencyindicators and performance reporting.Some of them involved their marketing,financial, product development andproduction people in the pilot activities.After the end of the pilot phase,participating companies continue to useeco-efficiency indicators in theirprocedures and include eco-efficiencyprofiles in their reports. Some haveexpanded the test approach from theparticular pilot site or business unit to

the entire corporation. Overall, theresults of the pilot studies show that theconcept is valid for all company typesand sizes. They also show that thegenerally applicable indicators, whichthe group had selected, as well as thereporting profile and use of eco-efficiency ratios, are appropriate across a wide range of business andgeographical sectors.

The WBCSD presents on its website aPerformance Platform that containsexamples of eco-efficiency profiles.These profiles describe companyperformances with key value andenvironmental indicators, and eco-efficiency ratios. The profiles are builtfrom a uniformly structured set of datapoints of a company s actualperformance and they also includeselected trend graphs of historical dataand some targets.

The WBCSD collection providescompanies with a platform to presenttheir eco-efficiency performance in aneasily understandable, clearly structuredway. With the direct link to corporateenvironmental or sustainability reportsand company websites, it is a portal tomore detailed data and contactinformation. Its aim is to show howcompanies can report theirenvironmental and economicperformance, and how to inter-relatethe two. Users can obtain a briefoverview of a company s eco-efficiencyscorecard. Using the same indicatorsrepeatedly allows them to develop abetter feeling for their meaning and tointerpret performance results. Theplatform also allows users to comparesimilar companies and develop sectoralaverage values.

Business cannot achieve eco-efficiency alone. Progress requires going

beyond internal actions of individual companies; it requires close

cooperation among societal stakeholders. Progress also needs society to

create an enabling framework that allows individual companies and whole

markets to become more eco-efficient. Governments have an important

role to play in creating those conditions.

Already, several countries and regions have enacted national and regional

action plans aimed at fostering a more eco-efficient and sustainable

society. Arriving at a broad consensus on headline indicators for eco-

efficiency and setting appropriate targets are among the crucial elements

that will help the transition to an eco-efficient economy.

This chapter summarizes the key elements of the political agenda for eco-

efficiency, describes the way governments can develop and implement

action plans for eco-efficiency and explains how eco-efficiency can be

quantified on the macro-level.

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chapter 3

How governments can make eco-efficiencywork for society

increasingquality of life without

depleting our natural capital

The government rationale for eco-efficiency is this. Environmentalimprovement and economic prosperityare both high priorities in manycountries in all parts of the world: eco-efficiency offers the opportunity tocomplement, not contradict, these twoobjectives.

Eco-efficiency also offers benefits to civilsociety – increasingly so as more andmore people aim to get more value fortheir money in the marketplace whilealso enjoying a better environment. Ifgovernments create the frameworkconditions which reward sustainability,more consumers would buy eco-efficientproducts and eventually contribute to amore sustainable economy.

23

increasing quality of life without depleting our natural capital

Progress toward sustainability andimproved environmental quality willcome mostly from better economicpolicies, as influenced by environmentalobjectives. Eco-efficiency is the conceptthat allows us to create the type ofinformation that governments need tohelp integrate environmental objectivesinto economic policies in order toachieve de-coupling of the use of naturefrom economic growth, therebycontributing to more sustainabledevelopment.

DOMINGO JIMÉNEZ-BELTRÁN

EXECUTIVE DIRECTOR,

EUROPEAN ENVIRONMENT AGENCY,

COPENHAGEN

WHY ECO-EFFICIENCY? ITS MACRO-LEVEL RATIONALE

ECONOMY AND QUALITY OF LIFE UP – RESOURCE USE AND POLLUTION DOWN

The above title could indeed becomethe news headline for an eco-efficienteconomy.

The solid lines in the below graph showwhere we are today. As economicgrowth has taken place, quality of lifehas also risen, but so too has resourceuse and pollution. Our argument is that,by adopting eco-efficient practices, it ispossible to decouple these trends sothat, as the dotted lines show, theeconomy and quality of life continue torise while resource use and pollution fallaway. Indeed, by reducing the pressureon natural resources and theenvironment we will actually magnifythe improvement in the quality of life

and cause it to climb more steeply thanit would otherwise have done.

For example, sulfur dioxide emissionsand the related acid rain could in manyareas be reduced to acceptable levelswith the help of advanced technologies.Or again, total energy consumption andits resulting carbon dioxide emissionsmight in some countries grow lessrapidly than the economy if eco-efficiency really takes hold.

Set against this, however, in someregions the overall quality of life willgrow more slowly than the economy ormay even tend to decline because ofincreasing environmental and social

24

chapter 3

pressures. Newly developed quality oflife (QoL) indices, which try to quantifyand measure this relationship, clearlyshow this unsatisfactory trend.

For the future, governments need tomaintain or improve quality of life,allowing it to grow closely coupled witheconomic prosperity, while resource useand pollution must become de-coupled

from the economy. There is a need tofind ways of preventing further increasesin the pressure on the environment oreven make them retreat to a level thatnature can digest and regenerate. Ofcourse, the two things are closely inter-related. Reducing pressure on naturewill also reduce the downward pressureon quality of life.

Ultimately, what is needed is animproving quality of life for all parts ofsociety along with an intact andbalanced natural environment. Ahealthy and eco-efficient economycould be a useful way of achieving bothtogether.

In chapter 2 we set out the businessagenda for eco-efficiency. Businessundoubtedly has many opportunities toincrease its eco-efficient performanceand thereby to help de-couple use ofnature from overall economic growth.However, the potential could be reallyamplified through political measuresthat reinforce the eco-efficientopportunities business already has.Such a political agenda is driven byforces outside business and isconcerned with the frameworkconditions and policies set by societyfor business.

The graph below describes the channelsalong which a business strategy for eco-efficiency can help de-coupling betweenuse of nature and growth in aneconomy. It also shows how policymeasures can amplify the effectivenessof these channels.

With a vision for a more sustainablefuture, entrepreneurs can implement aneco-efficiency strategy that hasinnovation as a major driver. Innovationcreates new products and new skills.While new products can lead to highercompetitiveness and therewith to

increased market shares, new skills canlead to increased knowledge and toadditional service jobs. Both lead then tomore employment and to entrepreneurialsuccess, finally ensuring economicprosperity and social betterment.

Governments – on their part – canimplement a policy that fosterseconomic growth and favors reductionof resource use and avoidance ofpollution with incentives for eco-innovation. Such policy measures toleverage business initiatives for moreeco-efficiency can include the following:

Identifying and eliminatingperverse subsidies: In manycountries, unsustainable behavioris still supported with subsidies.These should be reduced andeventually removed.

Internalizing environmentalcosts: In several economicsectors, considerable costs causedby environmental pollution andsocial damage are still notincluded in the price of goodsand services. Until this ischanged, the market willcontinue to send wrong signalsand polluters will have noincentive to change and adaptthe performance of theirproducts and processes.

THE POLICY AGENDA FOR ECO-EFFICIENCY

25

increasing quality of life without depleting our natural capital

Shifting tax from labor andprofit to resource use andpollution: To avoid destructiveeconomic effects, tax shiftsshould be implemented in apredictable way, avoiding anyincrease in the overall taxburden.

Developing and implementingeconomic instruments: Theseinclude emissions trading as an

incentive for companies toimplement eco-efficiencymeasures.

Promoting voluntaryinitiatives and negotiatedagreements: Governmentsshould negotiate agreements andsupport voluntary initiativesdesigned to promotesustainability in particular sectorsor market areas.

Governments could also developnational plans to make their economiesmore eco-efficient. These plans shouldinclude measures and programs whichinvolve all sectors of society.

NATIONAL ACTION PLANS FOR ECO-EFFICIENCY

Several countries and regions havealready developed national and regionalaction plans and made dramaticprogress as a result. We list here just afew examples, knowing that many morecountries have started to think abouteco-efficiency.

In its 1996 report, Sustainable America: ANew Consensus, the President s Councilfor Sustainable Development (PCSD)made several recommendations forbuilding a new framework. Amongthem were performance-basedmanagement systems, an extendedproduct policy, a shift in tax policies,subsidy reform and the use of marketincentives.

Also in 1996, OECD environmentministers observed that a strategy toimprove eco-efficiency might enableindustry, governments and householdsto decouple pollutant release andresource use from economic activity.The OECD investigated the potential ofthe eco-efficiency concept in the lightof studies suggesting that factor-of-tenefficiency improvement are bothnecessary and possible in the next 30years . The results were published in the1998 OECD report on eco-efficiency,which recommended the development

and use of eco-efficiency ratios asmacro-level indicators. The OECDidentified innovation as the key driverfor improving eco-efficiency and saidthat it was best stimulated by strongcompetition, high factor prizes andregulatory incentives, an effectiveprocess of disseminating best practiceand the presence of a good climate forinnovation .

Eco-efficiency has become an importantstrategic element of the EU s policytoward sustainable economicdevelopment. The EU Council has calledfor the integration of environmental (aswell as social) aspects into the EU seconomic and industrial policies of theUnion. The European EnvironmentAgency (EEA) is using eco-efficiency asthe leading concept for definingnational performance indicators andsetting respective targets.

Several European countries, particularlyin the Nordic region, have alreadycreated a framework within theireconomic and industrial policies toprovide more support for higherresource productivity and environmentaland social improvements. And EUmember states, as well as countries inother parts of the globe, have started to

explore ways of using eco-efficiency as apolicy concept.

The WBCSD, in co-operation with variousmulti-stakeholder organizations andgovernmental bodies, is implementingseveral projects to develop eco-efficiencyfurther as a policy concept:

Under the leadership of theCanadian National Round Tableon the Environment and theEconomy (NRTEE) together withWBCSD, first attempts weremade to develop eco-efficiencyindicators for business in varioussectors.

With European Partners for theEnvironment (EPE), supportedfrom the European CommissionDirectorate General for Enterprises(formerly DG III), the WBCSDlaunched the European Eco-efficiency Initiative (EEEI) in 1998.In its first two years, the initiativehas achieved its objectives ofpromoting the understanding anduse of eco-efficiency throughoutEurope and supporting andfacilitating national initiatives, aswell as the creation of eco-efficiency action plans.

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chapter 3

The WBCSD s eco-efficiency workin Europe focuses on Central andEastern European Countries(CEEC), several of which are inthe process of accession to theEuropean Union. Under theauspices of the Aarhus Businessand Environment Initiative(ABEI), and in concert with theRegional Environmental Center

(REC) in Budapest, the WBCSD isworking to make eco-efficiencymore widely understood andimplemented by CEEC businessesand governments.

The WBCSD also has a longtradition of cooperating withbusiness organizations indeveloping countries and

emerging economies – inparticular through its RegionalNetwork of 30 national BCSDsand partner organizations with atotal membership of over 800companies in Latin America,Southern Africa, East andSoutheast Asia and EasternEurope.

HOW GOVERNMENTS CAN MEASURE ECO-EFFICIENCY

What works for business can also workfor national economies.

Quantifying problems, setting targetsand measuring progress towardachieving them are very effectivemanagement tools for governments,too. Quantitative figures and indicatorscan tell what needs to be changed andby how much. Such indicators areimportant for measuring the progress inlinking governmental and businessactions.

Together, business and governmentscan set the right targets and formulatetheir strategies for meeting them.Governments can stimulate progress byenacting legislative, financial andtechnical measures to create the rightincentives to encourage and rewardinnovation and change in performance.

Factors 4 and 10 are eco-efficiencytargets for the economy at large. By

calling for increased welfare andreduced use of nature and forenvironmental space to be more

equally distributed one is really settingmacro-economic eco-efficiencyobjectives. Companies can and mustcontribute to attaining these objectivesbut cannot do so alone.

The OECD lists trends and targets ofeco-efficiency ratio indicators,formulated as GDP per environmentalinfluence, and relates them to the goalsof Factors 4 and 10. While GDP (theratio numerator) is growing in mostOECD countries, some environmentalinfluence figures (the ratio denominator)are decreasing. Other environmentalaspects are also increasing, some with aslower rate than GDP, others higher.

The EEA has adopted productivity oreco-efficiency ratio indicators forcountries, asking for an absolute andrelative de-linking of growth of welfare

from the use of nature . It intends tomeasure and compare economic sectorsand countries with each other accordingto their eco-efficiency status andimprovements. The agency hasannounced a set of Headline Indicatorswith the intention of developing a databasis for European countries andeconomic sectors. Both EEA and WBCSDare working toward matching headlineindicators for nations and generallyapplicable indicators for corporatereporting.

Formulating targets is the key toprogress. The WBCSD has proposedsetting macro-economic targets assustainability conversion criteria in theform of eco-efficiency ratio indicators.Such conversion criteria should, webelieve, include targets fordematerialization, energy and waterefficiency, greenhouse gas emissionreduction, job creation and povertyalleviation.

27

increasing quality of life without depleting our natural capital

Eco-efficiency is not a model formaintaining the status quo. It is aleadership practice aimed at thoseintending to stay ahead of the curveand meet the future needs of society,natural resource availability and publicperceptions. By creating competitiveadvantage, it appeals to those whowant a competitive and innovativeeconomy.

Quantifying eco-efficiency with macro-level headline indicators givesgovernments the ability to measureprogress on national and supranationaleco-efficiency targets. Macro-performance will be measured by theperformance data of the various sectors(industry, households, agriculture, etc.)and of individual companies.

Assessing performance against targetsallows governments to develop andenact the policy measures that willaccelerate progress towards thosetargets. The indicators and programs to support such measures form the key elements of a policy framework that promotes eco-efficiency andsustainability.

Governments can use various incentivesto promote action toward progress andsupport initiatives to advance eco-efficiency – rewarding the leading-edgecompanies and putting pressure on thelaggards. Incentives to reward eco-efficiency will guide innovation in theright direction and create new productsand services. Eco-efficiency leads tomore value from fewer resources,through redesign of products andservices and through new solutions. The more successful companies setthemselves tough environmental targetsand meet them with new technologiesand practices.

Eco-efficiency fosters the application ofnew knowledge to the design ofcomplex systems and value chains.There is a unique opportunity fornations to leverage, network andenhance the many centers of excellencethat have already emerged in manyorganizations. Education, research &development will create a new breed ofdesigners, system specialists andentrepreneurs able to meet the world sdevelopment goals.

Eco-efficiency will also create new jobsprovided that conditions that supportinvestments, entrepreneurial skills andfriendly markets are met. Eco-efficiencytargets and negotiated agreements willencourage businesses to embark on aneco-efficiency course. Public procurementinitiatives which integrate eco-efficiencycriteria will accelerate demand andprovide clear market signals. Consumerinformation, energy and water standardsin key activities such as housing,agriculture, transport or tourism willcreate a demand for service providers ofeco-efficient solutions.

Eco-efficiency will create a competitiveadvantage for enterprises and foster acompetitive economy. What is more,putting it at the heart of the policyframework and strategy for sustainabledevelopment will catalyze the efforts ofall stakeholders.

ECO-EFFICIENCY AND MACRO-ECONOMIC DEVELOPMENT

Eco-efficiency is not a model formaintaining the status quo.

Eco-efficiency will also createnew jobs provided thatconditions that supportinvestments, entrepreneurialskills and friendly markets aremet.

Eco-efficiency can serve companies as a means for developing and

successfully implementing a business strategy toward sustainability. Such a

strategy will have a strong focus on technological and social innovation,

accountability and transparency, as well as on cooperation with other parts

of society with a view to achieving the set objectives.

In the same way as it serves private companies, eco-efficiency can support

governments in deriving a national strategy for sustainable development.

Setting framework conditions which foster innovation and transparency,

and which allow sharing responsibility among stakeholders, will amplify

eco-efficiency for the entire economy and deliver progress toward

sustainability. The economy, together with quality of life, will continue to

grow while the use of resources and pollution will go down.

In this, the final chapter, we list action points for the various players

involved. If they are adopted by all concerned, we are confident that we will

arrive at more eco-efficient performance by business, a growing world

economy and a more sustainable future for the planet.

28

chapter 4

Onward to an eco-efficient economy

with creativityand shared responsibility

Governmental leaders and civil servants

1. Set macro-economic eco-efficiency targets and conversion criteria forsustainable development

2. Integrate policy measures to strengthen eco-efficiency (by, for example,eliminating subsidies, internalizing externalities and effecting shifts in taxpolicy)

3. Work toward changing international policy rules and systems for trade,financial transactions, etc, to support higher resource productivity andemissions reduction, as well as improvements for the underprivileged

Civil society leaders and consumers

4. Encourage consumers to prefer eco-efficient, more sustainable productsand services

5. Support political measures to create the framework conditions whichreward eco-efficiency

Educators

6. Include eco-efficiency and sustainability in high school and universitycurricula and build it into research and development programs

Financial analysts and investors

7. Recognize and reward eco-efficiency and sustainability as investmentcriteria

8. Help eco-efficient companies and sustainability leaders to communicatetheir progress and related business benefits to financial markets

9. Promote and use assessment tools and sustainability ratings to supportthe markets and to help widen understanding of eco-efficiency s benefits

Business leaders

10. Integrate eco-efficiency into their business strategy, including theiroperational, product innovation and marketing strategies

11. Report company eco-efficiency and sustainability performance openlyto stakeholders

12. Support policy measures which reward eco-efficiency

29

with creativity and shared responsibility

We can expect that eco-efficiency willbecome the leading economic principlefor the first quarter of the 21st century.In 2030, about 8 billion people will liveon this planet, 3 billion of them at thestandard which Europeans enjoy today.This will mean a four-times increase ingoods and services overall. Withoutdramatically increased eco-efficiency thiswould surely be the ruin of the planet. Afactor 4 increase in eco-efficiency withina generation is therefore the very modestobjective we can call for to ensure theplanet s ability to survive and lead intoa sustainable future.

If business and academia use all theirpotential for creativity and innovation,civil society will emotionally follow. Thengovernments will also adopt theframework and finally reward those thatare courageous and more efficient. Eco-efficiency and Factor 4 are ourtrademarks for that vision.

ERNST ULRICH VON WEIZSÄCKER,

PRESIDENT OF THE WUPPERTAL INSTITUTE FOR

CLIMATE, THE ENVIRONMENT AND ENERGY,

MEMBER OF THE GERMAN BUNDESTAG

All parts of society share theresponsibility for progress. Business hasan important part to play and acceptsthe challenges. But governments andcivil society must also play their part.

TWELVE KEY ACTION POINTS FOR AN ECO-EFFICIENT FUTURE

The WBCSD proposes 12 action pointswhich, if adopted by the variousstakeholder groups, will help move theworld forward toward an eco-efficientfuture. We believe each group shoulddo the following:

30

Stefan Schaltegger, Andreas Sturm;Ökologische Rationalität, in DieUnternehmung Nr 4, 1990

International Chamber of Commerce(ICC); The Business Charter forSustainable Development, Paris, 1991

Stephan Schmidheiny and the BusinessCouncil for Sustainable Development;Changing Course, MIT Press, 1992

Roberto de Andraca, Ken F. McCready;Internalizing Environmental Cost toPromote Eco-efficiency, BCSD, Geneva,1994

Ernst Ulrich von Weizsäcker, AmoryLovins, L. Hunter Lovins; Factor Four,Droemer Knaur, 1995

WBCSD; Eco-efficient Leadership,Geneva, 1996

Stephan Schmidheiny, Federico J. L.Zorraquin with the WBCSD; FinancingChange, The Financial Community, Eco-efficiency and Sustainable Development,MIT Press, 1996

The President s Council on Sustainable Development; SustainableAmerica, A New Consensus forProsperity, Opportunity and a HealthyEnvironment for the Future,Washington, 1996

Mathis Wackernagel and Willam Rees;Our Ecological Footprint, ReducingHuman Impact on the Earth, NewSociety Publishers, 1996

Claude Fussler with Peter James; DrivingEco-innovation: A breakthroughdiscipline for innovation andsustainability, Financial Times Pitman,London, 1996

Stephan Schmidheiny, Rodney Chase,Livio DeSimone; Signals of Change,WBCSD, Geneva, 1997

Livio D. DeSimone, Frank Popoff withthe WBCSD; Eco-efficiency – TheBusiness Link to SustainableDevelopment, MIT Press, 1997

Jerald Blumberg, George Blum, ÅgeKorsvold; Environmental Performanceand Shareholder Value, WBCSD,Geneva, 1997

John Elkington; Cannibals with Forks, The Triple Bottom Line of 21 Century Business, Capstone, 1997

WBCSD; Exploring SustainableDevelopment, Global Scenarios 2000-2050, Geneva, 1997

Robert M. Day; Beyond Eco-efficiency:Sustainability as a Driver forInnovation, World Resources Institute,(WRI), 1998

Stefan Schaltegger, Andreas Sturm; Eco-efficiency by Eco-Controlling, vdf,Zürich, 1998

Organization for Economic Co-operation, and Development(OECD); Eco-efficiency, Paris, 1998

UNEP and WBCSD; Cleaner Productionand Eco-efficiency, ComplementaryApproaches to SustainableDevelopment, 1998

WBCSD; Eco-efficiency Case StudyCollection, www.wbcsd.ch/eedata/eecshome.htm, 1998

Responsible Care: Health, Safety &Environmental Reporting Guidelines,European Chemicals Industry Council(CEFIC), 1998

WBCSD; Sustainability through theMarket, A Business Based Approach toSustainable Production andConsumption, Executive Brief, Geneva,1999

National Round Table on theEnvironment and the Economy (NRTEE);Measuring Eco-efficiency in Business,Feasibility of a Core Set of Indicators,1999

Friedrich Schmidt-Bleek, YannisPaleocrassas, Franz Lehner, Willy Bierter,Tony Charels; The International Factor10 Club s 1999 Report to Government and Business Leaders,Institute for Work and Technology,Gelsenkirchen, 1999

Nordic Council of Ministers; Factors 4and 10 in the Nordic Countries,TemaNord, Copenhagen, 1999

European Environment Agency (EEA);Making Sustainability Accountable: Eco-efficiency, Resource Productivity andInnovation, Topic Report No 11, 1999

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31

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European Environment Agency (EEA);Environment in the European Union atthe Turn of the Century, EnvironmentalAssessment Report No 2, 1999

Ernst Ulrich von Weizsäcker, Jan-DirkSeiler (Hrsg.); Ökoeffizienz,Management der Zukunft, Birkhäuser,1999

European Partners for the Environment(EPE) and WBCSD; European Eco-efficiency Initiative (EEEI); Brief No1 andBrief No 2, Brussels and Geneva, 1999

The Regional Environmental Center(REC); The Aarhus Business andEnvironment Initiative: Eco-efficiency forCentral and Eastern Europe s Enterprises means being a successfulneighbors, Budapest. 2000

Hendrik A. Verfaillie, Robin Bidwell;Measuring Eco-efficiency – A guide toreporting company performance,WBCSD Geneva, 2000

WBCSD; Performance Platform: ACollection of Company Eco-efficiencyProfiles, www.wbcsd.ch/ee/EEMprofiles/index.htm, 2000

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32

The World Business Council for Sustainable Development (WBCSD) is a coalition ofabout 150 international companies united by a shared commitment toenvironmental protection, social equity and economic growth, in other words, tosustainable development. Members are drawn from more than 30 countries and 20major industrial sectors. The WBCSD also benefits from a thriving global network ofnational and regional business councils and partner organizations.

In broad terms, the WBCSD aims to develop closer co-operation between business,government and all other organizations concerned with the environment andsustainable development. We also seek to encourage high standards ofenvironmental management in business itself. More specifically, our objectives are:

Business leadership: To be the leading business advocate on issues connected withthe environment and sustainable development

Policy development: To participate in policy development in order to create aframework that allows business to contribute effectively to sustainable development

Best practice: To demonstrate progress in environmental and resource managementin business and to share leading edge practices among our members

Global outreach: To contribute through our global network to a sustainable future fordeveloping nations and nations in transition.

DisclaimerThis report is released in the name of the WBCSD. Like other WBCSD reports, it is theresult of a collaborative effort by members of the secretariat and executives fromseveral member companies. Drafts were reviewed by a wide range of members, soensuring that the document broadly represents the majority view of the WBCSDmembership. It does not mean, however, that every member company agrees withevery word.

Ordering publicationsWBCSD, c/o E&Y Direct, PO BOX 6012, Fairfax House, Southfield Lane Tockwith,North Yorkshire YO26 7YU, UKTel: (44) 1423 846 336 Fax: (44) 1423 846 030 E-mail: wbcsd@e-ydirect.comPublications are available on WBCSD’s website: http://www.wbcsd.org

Copyright © World Business Council for Sustainable Development

October 2000ISBN 2-940240-17-5

about the WBCSD

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