The business value of Life-Cycle Thinking and Analysis
Speakers from DSM and Philips shared their views and internal practices which stimulated a lively discussion afterwards in small groups.
The first Environmental, Health & Safety Seminar took place at the sustainable ‘Wasven’ farm in Eindhoven with 45 people attending. The main objectives of this seminar were to share experiences and best practices between sustainability practitioners from various companies.
The topic of the seminar was “The business value of Life-Cycle Thinking and Analysis”. Speakers from DSM and Philips shared their views and internal practices which stimulated a lively discussion afterwards in small groups.
Two main insights of the seminar ‘The business value of Life-Cycle Thinking and Analysis’
- LCA can steer green (ECO+) products that significantly contribute to sales and margins;
- LCA can support material selection, but needs further development to measure Circular Economy environmental benefits (especially complicated recycling loops).
LCA within DSM
DSM uses LCA to generate and validate ECO+ and PEOPLE+ products respectively with less environmental impact and with better impact on people’s life’s compared to competitor products.
A powerful message of Dave Morris from DSM is that the ECO+ program proves to be a strong business driver: the delta in contribution margin % of ECO+ products with the non-ECO+ products is now more than 10 full percentage points.
As a next step DSM wants to improve the methodology and application of social LCA and also leverage profit on PEOPLE+ business.
LCA within Philips
LCA within Philips is also being used to steer and validate the Green Product portfolio. In addition, LCA is used to support its goals on Green Manufacturing. In the future, it is foreseen that LCA will increasingly be used to support green marketing i.e. to substantiate green claims.
Three LCA practitioners working in different part parts of the Philips organization shared their views on the added value of LCA:
Bas van Der Hoek, senior manager New Product Introduction at the Philips shaver factory in Drachten: “Activity based footprinting provides management with additional arguments, e.g. societal costs, when deciding on investments.”
Ruud Balkenende, principal scientist, commented on the limitation of the current LCA methodology to capture benefits of Circular Economy: “LCA can be used to screen different material options but when it comes to the full life-cycle with recycling loops and many possible repair, recovery and recycling scenarios, the LCA methodology has its limitations.”.
Hans van der Wel, director Sustainability and EcoDesign at Philips Group Sustainability, emphasized that easy and accurate data collection, especially the Bill of Materials (BOM) is the key for future LCA work.
During the group discussions, many different views on the business value of LCA were shared. Please read the full report.
The next PES seminar will most likely take place during the last quarter of this year and will focus on Behavorial Based Safety.