Title Evaluating the Environmental Performance of by qxc16070

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									             Master of Science in Environmental Science

                                                                        ENV- 521

                                                     Business and the Environment

                                                                    Assignment - 01




       Title: Evaluating the Environmental Performance of
                 Nel Farm & Hatchery- Sri Lanka

                                           Author;

                   ARUNA JAYAWARDHANA – 30425435

                                       Total Words - 2185




Aruna Jayawardhana – 30425435, ENV - 521                                          1
Table of Contents


Introduction..................................................................................................................3
Corporate Objectives ....................................................................................................3
Environmental Policy ...................................................................................................3
Cord of Environmental Practices and Standers of Practices ..........................................4
Corporate Structure and Employee Involvement...........................................................4
Environmental Management Systems ...........................................................................4
Consumption, production and Waste Management .......................................................5
Environmental Auditing and Cost Benefits ...................................................................5
Environmental Liabilities, Accident and Compensations ..............................................5
Relationship with public and stakeholders ....................................................................6
Communication and Verifications ................................................................................6
Overall Desires to Improve...........................................................................................6
   Stakeholder Information ...........................................................................................6
   Report Presentation ..................................................................................................8
   Benefit to the Organisation .......................................................................................8
Evaluation Results........................................................................................................9




Aruna Jayawardhana – 30425435, ENV - 521                                                                                     2
Introduction

Corporate Environmental Reporting is a sign of transparency of the organization and it
shows their accountability and transparency to the stakeholder and others concentration.
An organization is effectively a function of its stakeholder groups, including its
employees, shareholders, the public, regulators, contractors, suppliers, customers and
other interested external parties, who have varying objectives and expectations that
need to be satisfied. The measurement and reporting of environmental performance is
becoming increasingly important in order to satisfy the expectations of such stakeholder
groups.
At present, in the world organizations are following many ways of environmental
reporting, among them mainly involuntary reporting such as media exposures, green
groups’ activities and court investigations can be seen. The methods of reporting can
categorise as Mandatory, Regulatory; Signatory, Voluntary, Confidential and Non-
confidential. Public environmental reports, Press releases and media briefings,
Employee newsletters comes under the non- confidential reporting category and it is
now become a most famous environmental reporting method. However, considering the
Public Environmental Report issued by many organizations can be seen clear
differences regarding the reporting objectives and framework.

As a result of world trend to CER, Nel Frrm and Hatchery as a one of Leading Poultry
Farm in Sri Lanka, has began to report their environmental activities. The purpose of
this review is to evaluate the first report of environmental performances of “Public
Environmental Report - 2005” - Nel Farm & Hatchery, Sri Lanka; using the Global
Reporting Initiative’s (GRI) criteria.


Corporate Objectives

Giving information in relation to the strategic thinking of Poultry Company to the
stakeholders about their environmental policy totally not included in the report. From
Managing Director and General Manager Statements quite clear about their company
profile, vision, mission, overall strategic objectives and core values and code of conduct
or ethical principles. It is quite clear that from beginning of the company and today
situation indicate that clear improvement of the organization. But it did not convince to
readers much environmental friendly in preference to sustainability.


Environmental Policy

Most of the agricultural farms producing reasonable amount of Green House Gases and
poultry farm one of main place for the pollution of environment. Therefore all the farms
should be under the environment policies and regulations. Taking into consideration of
this report is aware of the policies. Farm processes and practices endeavor to minimise
the impact on the community and environment. Their waist management practices and
sustainable use of coconut land could be important massage for the stakeholders and
other readers.



Aruna Jayawardhana – 30425435, ENV - 521                                                3
Moreover report mentioned their farm practices applied to an international operation,
but it is not clear in what way or how? But, overall ideas of environment policies are
quite clear and comprehensive.

Cord of Environmental Practices and Standers of Practices

This report indicates as a multi industry company within the Poultry Industry and
Coconut productions. From the company founder it was came through the same
principles, because founder was a foreigner to the country. As a sustainable use of
land, sustainable use of wastes to the land as manure, it is some what recycling.
Thinking about alternatives of proper land use and management, company ethics are
quite clear with the practices.


Corporate Structure and Employee Involvement

Corporate structure of the company is unclear; some places mentioned about that their
working under the departments regulations. It seems to be a green wash of their work.
According to report not mention about any officer of department within the
organization regarding environmental management or coordinating and also no any
accounts or figures about their mechanisms within the company or corporate with other
organizations. Nevertheless no any sufficient dates provided to specify their employee
involvement towards the activities or any of company rewords system to encourage
them.


Environmental Management Systems

EMS quite unclear according the report, even though some of the figures available
(Chart 01) but of lack of evidence to support for that, as a example report revealed
GHG emission details without giving system of measurements or what type of
instrument or technology they got to do?. Some of the dates can be proof that company
in position the Global Reporting Initiative’s (GRI) sion about the financial and sufficient
human resources to do the job and it is good news that their under supervision of ISA
14001.

Chart 01
Environment                                 2000       2001      2002      2003      2004
Direct methane (CH4) f (tones)                0.0001    0.0005   0.00062   0.00012   0.00018
Direct greenhouse gas (GHG) f
(tones CO2 equivalent)                     0.0000001 0.0000011 0.0000014 0.0000011 0.0000001
Sulphur dioxide (SO2) (tones)                   0.01     0.012     0.014     0.013     0.015
Fresh-water use (cubic meters)                   254       265       268       300       312




Aruna Jayawardhana – 30425435, ENV - 521                                                    4
Consumption, production and Waste Management

Nel Farm and Hatchery is in a quite better position of their utilizations such as
materials, energy and water usage. Even though without accounted dates to verify,
readers are persuading about the sustainable ways of company planning to prevent high
cost of transport, row materials and diseases control.
Production-vice report not mentioned the annual profits or loses, but in other ways
mentioned about their production capacities. There is no clear evidence about the
product quality assurance system or life cycle assessments. But some verbal and
pictures evidence confirms that their rearing high genetic environmental friendly
breeders.

Waste management can be seen as successful, because of the main waist of poultry
litter use of lot other alternative ways. But still insufficient evidence to support the
statements that how much waist their producing a year or period, how much income
getting or recovering by selling or use of their own land. Other than that, energy and
water use minimization records also unavailable.

Environmental Auditing and Cost Benefits

It is a new concept for the organizations to auditing the environmental activities. As
most of the reports, this report also giving some information about lots of their
activities (training program, scholarships, work shop, laboratory work) of environment,
but not clear about the auditing systems or cost to the organizations. However I believe
that spending money on environmental activities can be beneficial to improve public
image.


Environmental Liabilities, Accident and Compensations

Referring the report it seems to be no any hazards happen so far. No any statement
about the liabilities or funds from the annual budget or any penalties so far. But there
are examples for (Chart 02), safety facilities during the five years period and it may
reduces the accident in work place. But company need to report their liabilities,
accidents. Also require to have superfund site record for compliance.

Chart 02

Safety                                     2000      2001      2002       2003       2004
Fatalities – employees                           1       1.2       1.3        1.4              2
Fatalities – contractors                     0.001     0.002      0.01      0.003          0.004




Aruna Jayawardhana – 30425435, ENV - 521                                                     5
Relationship with public and stakeholders


Relationship with the public is most important specially food and beverage
manufacturing company. However this company appears maintain good public
relationship via introducing income-ways to the surrounded communities and supplying
fee technical services. But there is no evidence about how many stakeholders they got.
Relationship with media not clear but some evidence confirm about the social activities,
Donations, Educational Programs, some relationship with the Government. But, still
report has lack of evidence to influence the number-vice or figure-vice about succeed of
the work.

Communication and Verifications

First effort of environmental reporting gives witness with this. However there was no
evidence before had any contribution of reporting their activities. But it is nice to here
form now on their on the track and waiting for ISO green certificate.


Overall Desires to Improve

However, a general review of the performance of the company is clear, various
activities and products during the period under has fairly mentioned.
But This Company is still in the initial stage in line with the Corporate Environmental
Criteria. Therefore I would like to mention some important recommendations need to
improve. Following instructions can be helpful for the successful environment
reporting.
    • A brief summary of Business Risks and Challenges facing
    • company including analysis of external environment steps taken to manage
         effectively such risks and plan to meet such challenges
    • A general review of the future prospects, outlook and plans expansion including
         future cash flows in comparison with short and long-term commitments of the
         company
    • Business process reengineering / development activities
    • Outline of the contribution of the company to the national tax and the economy
         of the country.
    • Information on how the company contributed to its responsibilities towards the
         development of Human Resources
    • Social respond


Stakeholder Information

More wide rage of information need include relevant for shareholders and other users
of financial statements and their interest. Nel Farm and Hatchery Report (Chart 03) is
totally incomplete according the criteria’s.




Aruna Jayawardhana – 30425435, ENV - 521                                                     6
Chart 03
Financial and Operation                                  2000      2001      2002        2003      2004
Total Broiler parents (Numbers)                           38000     38000        45000    65000     85000
Total Layer parents (Numbers)                             18000     22000        26000    26000     30000
Total Commercial Broiler Products
(kg)                                                     360,000   454,000   435,000     624,000   852,000
Total Chicks Products (Millions)                            1.56       3.1       4.2         4.8       6.5
Total Commercial Egg Products
(Millions)                                                   3.2       4.5         6.8      10.4     10.85
Taxes to governments (Rs million)                           21.5      23.6        24.8      28.5     28.64
Distributions to shareholders (Rs
million)                                                   18.25     17.53       18.06      19.2     22.45
Benefits to employees – including
wages, salaries, benefits and
pensions (Rs million)                                       14.3      15.5        14.6     16.12     17.56
Spending on suppliers and
contractors (Rs million)                                    24.5      23.5       24.68      29.5      32.8

Example chart 01

               100%
                80%
                60%
                40%                                                       2004
                20%                                                       2003
                 0%
                                                                          2002
                        .. .       .
                                n.     .. .     ... ..                    2001
                      pe are rod rnm plo.
                    O        p     P         e
                 nd     er      s      ov       em                        2000
              l a Lay hick o g s to
           cia al         lC      s
                                     t
                                           f it
         an Tot        ta axe ene
     F in           T o       T      B


Data reporting is most important part of the Corporate Environmental reporting. As
chart 03 presented their financial and operation data’s, not clear in their position in the
market and how their annual profits or losses and reasons. Only they supplied data of
total number of productions. But important thing is to tell that how many present they
supply from the total requirements or their potential contribution, Instead of presenting
data’s, it’s clear to present as graph or chart (Example chart 01). So it shows quick
transparency of the company for readers. Data presenting in following areas can be
most important.
1. At least Six year summary including
    • Profit and Loss
    • Net Turnover
    • Gross profit
    • Operating Profit
    • Profit after Tax
    • Dividends including bonus shares

2. Balance Sheet

Aruna Jayawardhana – 30425435, ENV - 521                                                                  7
    • Share Capital
    • Reserves
    • Property, Plant and Equipment
    • Net current assets / liabilities
    • Long term / Deferred liabilities
3. Investor information
    • Gross profit ratio
    • Earning per Share (EPS)
    • Inventory turnover ratio
    • Debtor turnover ratio
    • Total assets turnover ratio/ fixed assets turnover ratio
    • Employees as remuneration
    • Government as taxes
    • Shareholders as dividends
    • Retained within the business

Report Presentation

Report presentation is important to get reader’s attractiveness. Also way of presenting
such as colors ,shape, printing papers, and printing methods and cover page, are
important areas to improve, following qualities are will useful to present complete
report.
   • Theme on the cover and verification information
   • Quality of printing and paper
   • Effectiveness of photographs and their relevance
   • Effectiveness of charts and graphs
   • Comprehensiveness of corporate information such as address for
        correspondence along with website, email address and telephone numbers est.


Benefit to the Organisation

Public environmental reporting is able to raise the environmental responsiveness and
assurance of their organization’s employees and management. Environmental reporting
can be associated to the health and safety of employees, the neighboring environment
where their located in or increase the confidence level within the organization. Hence
number of benefit can be achieving by Reporting their organizational commitment with
the environment.

Creation of market opportunities; Environmental reporting increased the profile of an
organisation, as a result can be achieving more recognition of accessible and potential
customers. Present trend of customers towards organic foods can be helpful of their
choose to purchase products from 'environmentally friendly'

Indirect improvements in internal environmental performance; Environmental reporting
can be results to put more investments to the company due to successfulness of the
company and they may prefer to invest in 'clean and green organisations' and may
appreciate the availability of public environmental performance information. It can
increase confidence of investors, insurers and financial institutions.

Aruna Jayawardhana – 30425435, ENV - 521                                                  8
When company work openly and closely according to the environmental organization’s
rule and regulations, equally company will gain improvement of relationships with
local communities, regulators, and non-government organizations.

Environmental reporting is leading to keep close relationship with the local
communities and even supportive of organisation that openly communicate with their
stakeholders. On the other hand work place safety and welfare programmers can
increase staff commitment.



Evaluation Results

Criteria                                                          %
   1. Environmental Policy ……. ……..               …….            40%
   2. Cord of Environmental Ethic and Standards   …….            45%
   3. Corporate Structure …… ……..                 …….            40%
   4. Employee Involvements       ……..            …….            55%
   5. Environmental Management Systems            …….            42%
   6. Total Quality Environmental Management      …….            10%
   7. Materials ,Energy, Water Usage              …….            55%
   8. Pollution Prevention, Waste Minimisation    …….            48%
   9. Product and Process Stewardship             …….            30%
   10. Environmental Accounting Benefits/Costs    …….            25%
   11. Environmental Auditing     …….             …….            00%
    12. Environmental Releases        …….            …….         40%
    13. Sustainable Relationship with Natural Ecosystems         20%
    14. Environmental Liability, Compliances         …….         00%
    15. Environmental Accident        ……             …….         00%
    16. Relationship with the Public/Medics          …….         65%
    17. Relationship with the Local Community        …….         60%
    18. Relationship with the Stakeholders           …….         20%
    19. Relationship with the Supplies               …….         30%
    20. Relationship with the Environmental Groups…….            00%
    21. Relationship with the political /Regulatory Systems      40%
    22. Participation in Comparative Environmental Counsels and Partnership    20%
    23. Communication of Environmental Activities……..            00%
    24. Industrial Ecology           …….          ……..           00%
    25. Verification with Independent Body        ……..           50%


    Average………………………………………………………… 28.15%




Aruna Jayawardhana – 30425435, ENV - 521                                             9

								
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