Manufacturers warned to test supply chains against eco-legislation
As legislators shift their focus from individual factories and processes towards tracking entire product lifecycles, manufacturers need to ensure their entire supply chain complies with environmental legislation, an environmental consultant has warned.
Many UK manufacturers could be operating illegally, simply because they have not kept track of liability thresholds built into environmental laws, said Leigh Holloway, a director of consultancy Eco3, speaking at the Subcon subcontract manufacturing exhibition in Birmingham today.
An example is the legislation on packaging, which covers any company that annually turns over more than £2 million and handles over 50 tonnes of packaging. Affected companies must join a compliance scheme and contribute towards the cost of packaging recovery and recycling.
"But many companies aren't aware how much packaging they're using," Holloway said. "It includes cardboard, strapping, even pallets, and it covers everything you import, whether from EU or non-EU countries."
Among those who have already been fined for breaches of the packaging rules are Porsche, JJB, River Island, and importer Western Wines, which last year was hit with the largest penalty yet, totalling £230,000.
Holloway added that there is also a host of other laws and regulations that manufacturers must keep track of. They include regulations prohibiting the use of substances such as lead, mercury and cadmium, the Carbon Reduction Commitment, and relatively new rules called REACH, which require the registration, evaluation and authorisation of chemicals.
A further challenge for manufacturers is that these rules only affect certain areas. So a fixing treated with anti-corrosive hexavalent chromium might be fine in some sectors, but would be illegal in electronic equipment or an automobile.
Holloway said that not only are too many companies unaware of their own obligations, many do not realise that environmental legislation also extends up and down the supply chain. They could therefore be vulnerable as suppliers and customers, not merely for what they manufacture themselves.
However, he added that in many cases, keeping track of how eco-legislation affects you can be a business win: "For instance, if you use less packaging, you pay less - and if you get it below 50t, you pay nothing."
Subcon 2009 is at the Birmingham NEC from 9-11 June.