ENVIRONMENTAL SAVINGS ARE BEYOND COSTS IN INDUSTRY

Commonsense measures in enterprises often bring environmental and financial benefits at the same time. Industry can save more money through easy measures, than environmental innovation costs. This is the main message of a continuous empirical survey in Hungary.
The KÖVET Association for Sustainable Economies (KÖVET) published its fifth study and case study collection, entitled Money back through the window. The five volumes (published every year since 2002) altogether contain 56 case studies from leading companies (e.g. Alcoa, Audi, Ericsson, Flextronics, GE, HP) and small enterprises. These companies represent 25% of the countries industrial output and 11% of all employees in the manufacturing sector. KÖVET surveyed and described 211 measures from these companies, which were not only beneficial for modernization, but also saved costs and the environment.
Measures have been classified into three groups (see the table for data):

“Washed fruits on the table”: These measures typically needed no investment at all, only rethinking a problem, reorganizing a process. Usual measures include the reuse or recycling of a waste, which had been transported and disposed of at a cost before. Cleaning concentrates, better insulation during renovating buildings, redesigning products, changing the order of production, optimization of transport routes are also common steps taken.

“Low hanging fruits”: The steps described here required some financial investment from the companies, but their payback period was quick: less than three years. Typical activities include modernization of sanitation of buildings, utilization of storm and groundwater, development of selective waste, change of the production process, waste compression.

“High hanging fruits”: In this group we find high investment activities, with long – 8 years average – payback time. These activities show that the responsibility of some companies go beyond short-term profit interest. These investments are more significant for the implementing firms – the ratio of the annual savings and the turnover is typically ten times higher, than in the previous group. Examples are the complete reconstruction

The winners of 2006

As a result of the five-year experience KÖVET has gathered a valuable database of cases, which can serve as positive examples and practical information for those who are also interested - but do not know how to proceed - in changing business operation to more environmentally friendly ways. The studies are introduced every year at KÖVET’s annual conference in Budapest, with about 150 participants. Hungary’s environmental minister is present every year and he gives three “Environmental Saving Awards” to the companies reaching the highest relative and absolute environmental and economic benefits. These companies have been promoted by KÖVET for the prestigious European Awards for Environment contest.