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What a waste

Author : Brian Mayne, Kathryn Warren & Adam Read

29 June 2012

With rising costs and resource security driving awareness of waste management issues, Brian Mayne, Kathryn Warren & Adam Read ask ‘is this a wasted opportunity for companies?’

Figure1: The waste hierarchy

There is increasing pressure on facilities management companies to make more efficient use of their resources and to reduce waste. This is a result of escalating waste disposal costs, the increase in the landfill tax, the introduction of new environmental legislation and voluntary codes of practice, and increasing environmental awareness of customers, employees and investors.


Many FM companies and their clients underestimate the true cost of waste. This is because they often only identify the waste disposal costs and not the other related activities such as handling, storage or treatment of waste. In addition there are also the hidden costs associated with waste management such as the value of wasted materials, labour and energy costs of production, and staff time and equipment used to move waste around. The actual cost of waste is typically equivalent to between 4% and 5% of turnover, but it can be as high as 10%. Therefore in today’s challenging economic climate, the need to identify and control the true cost of waste is more important than ever before.


Apart from the benefits of FM companies reducing their customer’s costs by better on (and off) site waste management, the need for them to keep abreast of changes in waste regulation, which has been a constant feature of UK waste policy, is extremely important. Waste regulations in the UK are largely derived from EU Waste law; however we are now increasingly seeing variations in waste policy and strategy in England, Wales, Scotland, and Northern Ireland which FM companies will need to be mindful of. Every business has legal responsibilities (a duty of care) when it comes to disposing of their waste and therefore keeping up to date with these requirements is essential for a progressive FM company that doesn’t want to face future liabilities for poor waste management decisions / practices.


There is also growing pressure faced by FM companies from customers, employees and investors who all have an increasing interest in local environmental performance.
Customers are increasingly requesting proof of an organisation’s green credentials when procuring services, and organisations in some sectors may be asked to demonstrate that they are implementing programmes to reduce waste and conserve resources (this is already evident in the FM market). Employees can see the benefits of working for a resource efficient company which as a result of being more competitive provides better safeguards for their future employment, whist investors/shareholders want the maximum possible return on capital and high dividend growth. They are therefore more likely to invest money in businesses who successfully use borrowed capital effectively through resource efficiency programmes and policies.


In order to improve resource efficiency, first of all it is necessary to establish a baseline to understand where waste arises and how inefficiencies occur. Often the main reasons for wasted resources are inefficient systems and poor working practices – machinery that hasn’t been ‘tuned’ for some time, or staff working practices that are more akin to habit than best practice for example. Overall, the best way of reducing wasted resources is to prevent waste occurring in the first place, and this requires a change of mindset from the top down.
Waste can be dealt with in a number of ways, but the most effective is by following the waste hierarchy that ranks waste management options in terms of their overall sustainability. This is shown in Figure 1.


At the top of the hierarchy is preventing waste in the first place; however, if this is not possible, then you should consider reusing, recycling or recovering other value (e.g. energy) from the waste. At the bottom of the waste hierarchy is waste disposal, which has the greatest impact on the environment (contributing to climate change, global warming and soil and water pollution) and is typically the least cost-effective waste management solution.
Therefore, it is best to aim to ‘move up’ the waste hierarchy so that you can save money, raw materials, water and energy – as well as improving your environmental reputation.
To ensure the more efficient use of resources and to identify how waste can be prevented, an FM organisation will need to work closely with their customers to identify the types and quantities of waste being generated. Although the onus may not be on you as the facilities manager to organise or monitor waste generation at the site, the likelihood is that you will have to handle what is produced. By identifying how much, the type and where the waste is generated it allows improvements to be suggested which could result in waste being eliminated and or reduced, providing savings in disposal costs. Data is key here – allowing an appreciation of the situation and informing decisions regarding new campaigns, services or policies. Some business models have been established where any profits from the sale of recyclables, or savings from waste reduction initiatives are shared between the FM company and the client. Even if there are no financial savings to be made by you as an FM provider, your client will surely appreciate you being proactive, leading to good working relationships and a close partnership approach to waste management.


Obtaining a better understanding of waste generated on site will also mean better decisions can be made in selecting the most appropriate balers, compactors and collection frequency for your clients waste. If the service can be made more efficient, then once again it is likely to lead to cost savings. By identifying the types of waste being generated, new systems could be put in place to ensure materials are source separated, as income can be generated from recycling certain wastes (metals, paper etc.), which may offset the costs of implementing the new system. A further benefit of undertaking these waste reviews is that they will assist you in not only developing actions to improve resource efficiency, but in enabling you to go back and monitor and evaluate any successes against a known baseline. The reviews could also be used to set performance targets and then monitor progress towards them year on year. Reviewing your waste collection contracts will also ensure that you are getting value for money from your service providers and that they have all the necessary paperwork to comply with waste regulations (the aforementioned duty of care).
A key element in reducing the amount of waste generated and increasing recycling of the remaining wastes is to communicate to your own staff, facility staff and contractors. This can be done in a variety of ways and doesn’t have to be complicated, for example artwork is available for waste prevention signs and posters which are nationally recognised and are readily available.


Support is available through companies who have extensive experience of developing waste on-site audits and reviews and then developing action plans for waste prevention, reuse and recycling as well as creating effective communication strategies. In addition the Waste Resources and Action Programme (WRAP http://www.wrap.org.uk/) is currently engaging the FM sector to identify and quantify the potential for cost and waste savings. They are looking at running pilot projects to improve resource efficiency through optimised procurement of goods and services consumed in and by the sector, as well optimising the management of assets both within and across FM contracts. They also aim to share good practice to improve resource efficiency across the whole sector as well as pilot alternative business models to reduce exposure to supply instability and price volatility.


If FM companies want to work with them to review a particular facility or service to determine where the greatest resource and cost savings could be made then you will need to contact them through their website (http://www.wrap.org.uk/).


There is no doubt that managing waste more effectively can save resources and money, for all parties. By reviewing your client’s waste streams (through composition and characterisation studies), supply chains and waste management contractors, you can ensure legislative compliance, improve performance and reduce expenditure – all of which are important in the current economic circumstances. By developing awareness and educating staff and customers you can ensure that everyone is on board and part of the process of reducing your overall environmental impact and provide proof that your company can “walk the talk” in resource efficiency, which will be key to business resilience and competition in the coming years.


The authors all work for AEA


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