Buying Green

Ms Linda W P Ho

Chief Executive OfficerChief Executive Officer

Green Council

January 10, 2011y ,

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Presentation Outline:

I. About Green Council

II. Green Purchasing and CSRII. Green Purchasing and CSR

III. Green Purchasing and Ecolabelling

IV. Worldwide Trend on Green Purchasing

V. Green Purchasing in Hong Kong

VI. Green Purchasing Network

VII Hong Kong Green AwardVII. Hong Kong Green Award

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I. About Green Council

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Green Council

• Established in 2000

• Non-Government Organization (NGO)Non Government Organization (NGO)

• Non-Profit-Making Organization

• Non-Partisan Environmental Organization

1 T h th i t l f

Major Objectives1. To enhance the environmental awareness of

the general public

2. To assist local and international enterprises inimproving their environmental performance

3. To help Hong Kong establish a greener imageworldwide

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Key Green Council Initiatives

– Hong Kong Green Label Scheme (HKGLS)

香港環保標籤計劃香港環保標籤計劃

– China Environmental Label

中國環境標誌產品認証計劃

– Cyber Green Centre

環保資源中心

– Hong Kong Green Purchasing Charter (HKGPC)g g g ( )

香港環保採購約章

– Hong Kong Green Awards (HKGA)

香港綠色企業大獎香港綠色企業大獎

– Eco-product Certification Scheme (ECS)

環保產品認證計劃

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List of Green Council’s Activities

1. Hong Kong Green Label Scheme (HKGLS)

2. Hong Kong Green Purchasing Charter (HKGPC)

3. Hong Kong Green Awards (HKGA)3. Hong Kong Green Awards (HKGA)

4. Cyber Green Center (CGC)

5. Representative of China Environmental Labelling

6 E i t l l t d i f6. Environmental related congress, symposium, forum, seminars and Exhibitions

7. Training of EMS and specific on Green Purchasing

8. Environmental, product and CSR Audits

9. Green Carnival

10. International Coastal Cleanup10. International Coastal Cleanup

11. Community Educations

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II. Green Purchasing and CSR

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Definition of Green Purchasing

Green Purchasing is the purchase of goods andservices that minimize environmental impacts. Itincludes the purchase of product that have “aincludes the purchase of product that have alesser or reduced effect on human health and theenvironment when compared with competingproducts that serve the same purpose.”

From the United State Environmental Protection Agency (USEPA)

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What is Green Purchasing?

Quality Cost Delivery ++ + EnvironmentQuality Cost Delivery ++ + Environment

Purchasing

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Green

=

Purchasing Green

Purchasingg

9Source: The Green Purchasing & Green Public Procurement Starter Kit

Target Fields of Green Purchasing

Office Supply

MotorcarPaper Hotel & MeetingPrinting

ServicesProducts

PC Distribution

Parts and Materials Cleaning

Printer

Furniture

Work wear

ElectricityBanking

LightingElectric Appliance Canteen

CateringConstruction

ElectricityEnergy

Electronic Parts

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Foodg g Catering

Source: The Green Purchasing & Green Public Procurement Starter Kit

“There is no business to be done on a d d l t”dead planet”

David Brower www.onepercentfortheplanet.org

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Cyclone Tornado

Gigantic Cyclone above Sea of IndiaTornado in Oklahoma

Gigantic Cyclone above Sea of India 

High Tide Hurricane

Family in Despair after Destruction of Cyclone What Tornado left…

House Destroyed, Bicycle blown

Uki 浮世繪 “Pi t f Fl ti W ld” i 17th C t

Major Typhoon Bankrupt of Insurance Company

Severe High Tide  Hitting Levee 

Desperate Mother with a Baby after TyphoonDestroyed House in Honduras

Ukiyo-e 浮世繪 “Picture of Floating World” since 17th Century

Coral Decay

Levee Destroyed and Flooding Houses

Utility Pole Knocked down by Strong Wind

Levee Destroyed and Flooding Houses Close to Ocean

Dying Coral in Okinawa 

Bankruptcy due to Increasing Number of Natural Disaster and its Results in 

Expanding Insurance Money 

En ironmental Disasters1212

Environmental DisastersSource: Yamamoto Laboratory, Institute of Industrial Science,  University of Tokyo  

What is Sustainable Development?Sustainable development, according to the World Commission on Environment and Development, is :

"development that meets the needs of the present without compromising p p gthe ability of future generations to meet their own needs." ["Our Common Future" 1987][ Our Common Future , 1987]

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Green Purchasing is Part of Sustainable Development

Sustainable Development Indicators – UK Defra (Department for Environment, Food and Rural Affairs)

http://www.defra.gov.uk/sustainable/government/progress/national/index.htm

68 indicators categorized into four themes:

1. Sustainable consumption and production2. Climate change and energy3. Natural resource protection and enhancing p g

the environment4. Creating sustainable communities and a

fairer world

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What Opportunities for Business?pp

• New markets through an improved understanding of consumer needs

• New products through the application ofNew products through the application of new technologies

• Greater investor confidence in ’ bilit t hcompany’s ability to manage change

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Corporate social responsibility: A business contribution to sustainablebusiness contribution to sustainable

development.

The European Commission definescorporate social responsibility (CSR) as "acorporate social responsibility (CSR) as aconcept whereby companies integrate socialand environmental concerns in theirbusiness operations and in their interactionbusiness operations and in their interactionwith their stakeholders on a voluntary basis".http://europa.eu/legislation_summaries/employment_and_social_policy/employment_right

s_and_work_organisation/n26034_en.htm

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Core CSR Area In Hong Kongg g

• Strategy & Reporting

• Stakeholder Engagement• Stakeholder Engagement

• Workplace Quality

• Environmental Performance

• Supply Chain

• Community Contribution

Source: Corporate Social Responsibility Survey of Hang Seng Index Constituent Companies 2009 by OXFAM HONG KONGhttp://www.hsbc.com.hk/1/PA_1_3_S5/content/cr/common/images/hsi_csr_survey_2009/HS_index_eng.pdf

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CSR and Green PurchasingGreen

PurchasingSupply Chain Management in CSR*

1. Supplier Code of Conduct

g

Green Spec.

Health & Safety

Supp e Code o Co duct

• Labour standards

• Environmental standards

Monitoring & Greenhouse gas

management

• Health and Safety Standards

2. Monitoring Mechanism

3 G h G M tManufacturing

&Distribution

Business

Purchasers

Governments

ConsumersBusinesses

management

Towards

3. Greenhouse Gas Management

4. Engaged Suppliers in Programmes

• Labour rights / educationSustainable

Society

g

• Environmental protection

• CSR reporting

Environmentally preferableproducts / services

• Creation of new green/sustainable products

18*Source: Corporate Social Responsibility Survey of Hang Seng Index Constituent Companies 2009 by OXFAM HONG KONGhttp://www.hsbc.com.hk/1/PA_1_3_S5/content/cr/common/images/hsi_csr_survey_2009/HS_index_eng.pdf

CSR and Green Purchasing

Source: Olympus Green Procurementhtt // l l b l / / / / i t/ d t /http://www.olympus-global.com/en/corc/csr/environment/products/green-procurement/

19Source: Nissan Green Purchasing Guidelinehttp://www.nissan-global.com/EN/DOCUMENT/PDF/SR/Nissan_Green_Purchasing_Guideline_e.pdf

CSR and Green Purchasing

Source: Hino Green Purchasing Guidelineshttp://www.hino-global.com/csr/environment/green.html

S G• Sony Green Procurement guidance is one of the CSR procurement requirement

Source: Sony CSR Procurement & Green Procurementhttp://www.sony.net/SonyInfo/csr/quality/cod /i d ht l

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de/index.htmlhttp://www.sony.net/SonyInfo/procurementinfo/green.html

CSR and Green Purchasing

Source: Hong Kong Housing Authority Sustainability Report

Source: HSBC CSR Report http://www.hsbc.com.hk/1/PA_1_3_S5/content/cr/co

g g g y y phttp://www.housingauthority.gov.hk/hdw/en/aboutus/publication/sr0809/our-environmental-performance.htm

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mmon/pdf/brochure/CS_brochure_eng.pdf

CSR and Green Purchasing

Source: Corporate Responsibility Report 2009 http://www.hangseng.com/e_about_us/corporate_responsibility/2009/customers.html#service_environment

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CSR and Green Purchasing

Source: Cathay Pacific CSR Report 2008http://downloads.cathaypacific.com/cx/press/CSRreport_en2008.pdf

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UNEP Sustainable Consumption programme

Sustainable consumption has been defined as:“The use of services and related productswhich respond to basic needs and bring ap gbetter quality of life while minimizing the useof natural resources and toxic materials aswell as the emissions of waste andwell as the emissions of waste andpollutants over the life-cycle so as not tojeopardize the needs of future generations.”

Source: UN CSD International Work Programme, adopted in 1995

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UNEP Sustainable Consumption programmeprogramme

• Production and consumption policies were considered to be two sides ofthe same sustainability coin, which needed to be addressed in anintegrated manner.

• integrated life-cycle approach towards achieving more sustainableconsumption and production patterns.

• Consumption patterns are the result of choices and activities of a wide variety of actors.

• Influencing these choices means stimulating and facilitating new economic opportunities and altering the current infrastructure and regulatory framework that lock consumers into unsustainable behavior.

• UNEP SCP Guidelines: consider the following in consumption and production

1. Environmental protection

2. Sustainable development

3. Strengthen the linkage between consumer interests

4. Sustainable consumption

25Source: http://daccess-dds-ny.un.org/doc/UNDOC/GEN/N98/038/55/PDF/N9803855.pdf?OpenElement

III. Green Purchasing and Ecolabelling

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Green/Ecolabelling/EnvironmentalISO Standards

Green/Ecolabelling/Environmental

ISO14020 Series - guidance for green/environmental labels

ISO14021 ISO14024 ISO14025 Other Types and (Type II)- self declared claims

(Type I)- life cycle, selective, third-party verified

(Type III)- life cycle information

Variationssingle-attribute with vertification

party verified

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GEN MembersGEN Members

Asian Members

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Relationship and Synergy between GP and Ecolabel

• Ecolabel product criteria used as purchasing technical

between GP and Ecolabel

Ecolabel product criteria used as purchasing technicalspecifications (precise, quantitative and certified)

• Ecolabelling and ecolabelled products flourish due to• Ecolabelling and ecolabelled products flourish due togovernment’s statutory and voluntary initiative ongreen purchasing (obvious and solid incentive)

• Green purchasing helps to select productcategories for ecolabelling (e.g. office equipment)

• Green purchasing may help to estimate the producteffectiveness

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Relationship and Synergy between GP and Ecolabel (cont)

• Ensure the positive environmental impact by commit to buy

between GP and Ecolabel (cont)

ecolabelled products due to its’ high credibility with third-party verification

• Easy to adopt ecolabel as technical green specificationsin tender for green purchasing.

• Facilitate the communication between purchasers andrelevant stakeholders on its green purchasing requirements.

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Product Information Tool/System

Ecolabelling, certification standards, reporting, declaration and green or ethical claims

F b i t t l t t l f• For business: management tools to control performancethrough the supply chain, and making tools to communicate the environmental credentials of productsFor consumers: they are shopping guides and action tools to• For consumers: they are shopping guides and action tools tovoice their concerns through the purchasing power

• For governments: these are policy tools to provide marketincentive and stimulate the demand for sustainable productsincentive and stimulate the demand for sustainable products

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IV. Asia Trend on Green Purchasingg

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GGP in TaiwanGGP in Taiwan

Article 96 of Government Procurement Act (1999)

• may purchase Green Mark products or equivalents preferentiallymay purchase Green Mark products or equivalents preferentially

• guides and enables government purchasers to consider and purchase green products at 10% high

Plan for Implementing Green Procurement by Government AgenciesPlan for Implementing Green Procurement by Government Agencies (2001)

• 44 designated product categories (2008) include:

– office equipments and utilities, home electrical appliances, water saving toilets, products made from recycled material and cleaning products, etc.

• Since the GGP programme’s implementation, the annual GGP spending in Taiwan has increased from 2.6 billion NTD (for the second half of 2002) to 5.6 billion NTD in 2003 and reached 6.77 billion NTD in 2008.

• Concurrently, the numbers of Green Mark licensed and ecolabelledproducts have also increased from 576 in 2002, to 717 in 2003, and to 876 in 2008.

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

GGP in Japanp

Green Purchasing Law, JapanEnacted May 2000 enforced May 2001Enacted May 2000, enforced May 2001All state institutions obligated to purchase designated procurement items (200 products in 18 categories)

• All central government ministries, 47 prefectural governments, 12 designated cities and 68% of 700 cities practicing green purchasingpracticing green purchasing.

• For designated items 95% green products• Labels referenced by government purchasers:

E k 94 4% E St 37 3% GPN D t B d• Eco-mark 94.4% ; Energy Star 37.3% ; GPN Data Base and others 28.4%.

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

GGP in Japan (cont.)GGP in Japan (cont.)

• Green Contract Law (Building) (enacted 2007)

– Promote public sector contracts’ consideration of GHG reductions

– Governs contracts in:Governs contracts in:• Electric power: evaluate power companies’ carbon

emission factors and environmental load reductions

• A t bil l t b th f l ffi i d i• Automobiles: evaluate both fuel efficiency and price

• ESCO projects: promote ESCOs through inclusion of equipment replacement in their scope

• Building designs: include eco-friendly technology as criteria for designer competence evaluation

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

GGP in Korea

Act on the Promotion of the Purchase of Environment -Friendly Products , Koreae d y oducts , o ea• Since July 2005, MoE annually sets up Purchasing

Guidelines of Eco-Products • Public agencies shall announce purchasing plans, practice, g p g p , p ,

and report annually

Government Spending on Green Products million USD

FY 2002 2003 2004 2005 2006

120 160 155 570 650

90 100 100 200 20090 100 100 200 200

Total 210 260 255 770 850

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

GGP in China

Government Procurement Law ChinaGovernment Procurement Law, China

• Since 2003

• “Government Procurement List on Environmental Labeling Products” released in January 2007

• 10,239 products within 33 categories under Energy Saving LabelSaving Label

• 2,823 products within 14 categories under Type I Label

• GGP amounted to 3. 5 billion US in 2007

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

GGP in Thailand

Green Public Procurement Policy, Thailand

• “Governmental Management Plan” in March 2005 required all agencies to buy green products within 4 years

• All governmental agencies (departmental level) must• All governmental agencies (departmental level) must

purchase green products within 2011 (starting from 25% of agencies in 2008 to 100% in 2011).

• Purchasing amount in each target product and services will be 25%, 30%, 40% and 60% of each product group in 2008, 2009, 2010 and 2011, respectively2010 and 2011, respectively

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

V. Green Purchasing in Hong Kongg g g

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GGP in Hong Kong

• In 2000, the Government Logistics Department (GLD) developed green specification for 38 categories of product

• Total amount of the GLD procurement in 2008 was HK$ 3.92 billion (approximately US$ 500 million) and the total value of products with ( pp y ) pgreen spec. was HK$ 1.76 billion

• In 2008, the Environmental Protection Department commissioned a consultancy study to update existing and develop new “green y y p g p gspecifications” to a total of 68 specifications documents.

• In 2010, completed the third consultancy study, the products with green specifications have increased to 103.green specifications have increased to 103.

Source: Linda W.P. Ho, Nicholas M. Dickinson and Gilbert Y.S. Chan / Natural Resources Forum 34 (2010) 24–38

Green purchasing Has Been One of the HKSAR Government’s Policies

(2005-2014)

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“The Government will also take the lead in making Hong Kong a green city, through l i l ti d ifi i l dilegislation and specific measures including:

expanding the scope of green procurement;stopping the purchase of incandescent light

bulbs; andformulating guidelines and providing new

resources to encourage departments to procure g p pgreen products.”

42@The final meeting of the HKSAR Government’s Task

Force on Economic Challenges on 22 June 2009

Green Purchasing Survey (2006)

• Objective

– Investigate the profile of the current practices and aspirations on green purchasing in Hong Kong

• Methodology (August – October 2006)Methodology (August October 2006)

– Personal interviews

– Online survey

Source: Green Purchasing Survey (2006) conducted by Green Council g y ( ) yhttp://www.hkgpc.org/html/eng/doc/2006survey_results.pdf

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Green Purchasing Survey (2006)

Summary of Results and Conclusion (N=735)

75% f d t illi t id75% of respondents were willing to consider

paying more for green products

among which 59% had found it difficult to locate desiredamong which 59% had found it difficult to locate desired green products

Government should play a stronger lead role in

practicing and promoting GP

great potential for the development and

advancement of green purchasing in Hong Kongadvancement of green purchasing in Hong Kong

comprehensive green products database is

crucial for practicing and promoting GPp g p g

44Source: Green Purchasing Survey (2006) conducted by Green Council http://www.hkgpc.org/html/eng/doc/2006survey_results.pdf

Green Purchasing Survey 2009

• Objectivesj– Determine the current status and emerging trends of GP by

Hong Kong businesses– Identify both achievements and shortcomings to dateIdentify both achievements and shortcomings to date– Provide sound guidance and recommendations for

strengthening and advancing GP (particularly in the private sector) in Hong Kongsector) in Hong Kong

• Methodology

– 1st Phase: online surveyy

– 2nd Phase: interviews with selected respondents

– Review of domestic and international GP policies and lit tliterature

45Source: “Report of The Research Study on The Current Status and Direction for Green Purchasing in Hong Kong” by Green Council

http://www.hkgpc.org/html/eng/doc/GPSurvey2009_report_FINAL.pdf

Green Purchasing Survey 2009

• Result

• 1st Phase (104 small and medium enterprises; 102 large• 1 Phase (104 small and medium enterprises; 102 large corporations)

– Around 58% respondent with GP procedure and in place

– Mostly concern about the impact on waste generation, energy consumption and GHG emission

• 2nd Phase (33 small and medium enterprises; 27 large• 2 Phase (33 small and medium enterprises; 27 large corporations)

– Around 50% respondents spend 10% of total purchasing dit GPexpenditure on GP.

– Over 50% of respondents thought GP will increase their total expenditure, but it will also show positive changes on the p , p genvironment.

46Source: “Report of The Research Study on The Current Status and

Direction for Green Purchasing in Hong Kong” by Green Council http://www.hkgpc.org/html/eng/doc/GPSurvey2009_report_FINAL.pdf

Challenges

According to GP Survey 2009, the common “obstacles”/ “challenges” faced by HK companies on implementing GPg y p p g

1. Increase in expenditures without significant improvement in environmental performance

2 Difficulty in integrating GP policy into their existing company’s2. Difficulty in integrating GP policy into their existing company s policy

3. Insufficient knowledge on identification of “green” products/servicesproducts/services

4. Inadequate supply of “green” products/services for selection in the marketI d id d/ i i GP i l i5. Inadequate guidance and/or training on GP implementation

6. Insufficient incentive in terms of financial support and commitment from top management

7. Socio-economic environment may impact upon the sustainability of GP implementation

47Source: “Report of The Research Study on The Current Status and Direction for Green Purchasing in Hong Kong” by Green Council

http://www.hkgpc.org/html/eng/doc/GPSurvey2009_report_FINAL.pdf

VI. Green Purchasing Networkg

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Green Purchasing NetworksGreen Purchasing Networks

Asia Europe North America International

Government Established/

Focused

Non-GovernmentGovernment

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Hong Kong Green Purchasing Charter• Launched in October 2007

• Objectives

– To formulate and apply green purchasing policies and strategies

– To implement green purchasing through practicable andTo implement green purchasing through practicable and sustainable means

– To promote and influence stakeholders to adopt green purchasingpurchasing

Funded by

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Local Green Purchasing Initiative –Hong Kong GreenHong Kong Green

Purchasing Charter (HKGPC)

• Supported by Environment & Conservation Fund (Government)L h d 4 O t b 2007• Launched on 4 October 2007

• 11 large corporations as founding members• 60+ members – large corporations and g

small and medium sized enterprises joined

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Workshops, Seminars and Exhibition

5252

EcoExpo Asia 2010

Membership Categories

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On-going Projects

Formation of GP Task Force• input to, and assist in the development andinput to, and assist in the development and

implementation of strategic and voluntaryprogrammes to promote the HKGPC and its greenpurchasing-related activities;p g ;

• prepare and/or share information on latest trends,initiatives and market information on environmentallypreferable products and/or services;p p ;

• identify and formally recognize outstanding ‘green’producers and suppliers; and

• participate regularly and enthusiastically in the Taskparticipate regularly and enthusiastically in the TaskForce meetings and activities arranged andconducted with the intention of pursuing andaccomplishing the three green purchasing promotionp g g p g pactivities identified above.

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VisionVision

• Raise awareness on the importance and benefits of green products and GP

Sti l t i d d d f d f ilit t MORE• Stimulate increased demand for and facilitate MORE green products available in the market

• Encourage private sector to practice GPg p p

• Form a Green Purchasing Network locally

Sustainable market for green products

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Future

IGPN

HKGPNJGPN KGPN GPNMCGPN GPNIGPI TGPN

HKGPC

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VI H K G A dVI. Hong Kong Green Award

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AwardsAwards

Hong Kong Green Awards (HKGA)Hong Kong Green Awards (HKGA)

1.Green Purchaswi$e Award (GPA)$ ( )

2.Green Office Management Award (GOMA)

• Each Award sets with Platinum, Gold, Silver & Bronze

• Two Sectors:

1. Large Corporations

2. SMEs

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ObjectivesObjectivesHong Kong Green Awards (HKGA)Hong Kong Green Awards (HKGA)• Encourage business in Hong Kong to include environmental consideration in their

operation and management processes

• Recognize corporations with high environmental conscious and their contribution• Recognize corporations with high environmental conscious and their contribution

on social responsibilities on greening of our city throughout the years.

1. Green Purchaswi$e Award (GPA)– recognizes and praise local corporations with their outstanding performance

on green purchasingon green purchasing.

2. Green Office Management Award (GOMA)g ( )– offers recognition on their achievement on offer environmental management.

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Supporting Organizations

Government:

International:

Commercial Association:

Purchasing Association:

HONG KONGWASTE

MANAGEMENTASSOCIATION

Professional Association d Oth

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ASSOCIATION香 港 廢 物 管 理 學 會

and Others:

http://www.hkgpc.org/html/eng/activities.aspx

http://www.greencouncil.org p g g

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Thank youThank you

Green Council Contact Details:

Website www.greencouncil.org

Email info@greencouncil orgEmail info@greencouncil.org

Telephone (852) 2810 1122

Facsimile (852) 2810 1998

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