1. The European Eco-Management and Audit Scheme Performance, credibility, transparency EMAS REVISION – PROPOSAL 29 JUNE 2006 – ARTICLE 14 MTG - LUXEMBOURG

2. PRESENTATION OVERVIEW 1) TIMING 2) EVALUATION 3) SCENARIOS 4) DETAILED PROPOSAL

3. TIMING (I) Progress Since Turin Art. 14 Meeting -Result EVER Study -Result REMAS study -Two expert groups: - Legal compliance, - Accreditation, Verification, Validation - Environmental Management System - Environmental Performance and Reporting -Visit to Member States -Revision concept discussion in DG ENV

4. TIMING (II) Next Steps -1st Draft text: end-summer -Open internet consultation: Sept - Oct -Stakeholder workshop: End-October -COM Impact assessment: Sept - Oct -COM Inter-Service Consultation: Nov-Dec 200520062007200820092010 External evaluation 1st draft Revision Commission adoption EP – Council agreement New EMAS III Next steps until COM adoption:

5. PRESENTATION OVERVIEW 1) TIMING 2) EVALUATION 3) SCENARIOS 4) DETAILED PROPOSAL

6. EMAS EVALUATION (I) Political Context -EMAS created in 90ies as complement to traditional ‘command-and-control’ legislation -5 th + 6th Environment Action Programme strongly advocate use of voluntary instruments, specifically EMAS -Currently, renewed Lisbon strategy focus on improving and simplifying regulatory framework for business => renewed interest for voluntary instruments

7. EMAS EVALUATION (II) EVER Result - EMAS improves environmental performances - EMAS improves compliance w/ environmental legislation - No significant barrier to EMAS implementation found - EMAS not seen as ‘the’ system of reference - Lack of competitive reward Drivers: Barriers: Other main findings: - Majority do not want to stop EMAS : useful policy tool - Most requested changes: make EMAS global + provide incentives to participating organisations

8. EMAS EVALUATION (III) REMAS – Our Analysis -EMS leads to better site environmental management -Better site management = - better environmental performance - better regulatory performance REMAS: EMAS overall environmental impact = Impact per organisation X Number of organisations Conclusion: Working, EMAS is best existing EMS Not working, low market penetration EMAS ranks highest overall

9. EMAS EVALUATION (IV) WG I Interim Results -Keep link w/ ISO14001 (problem with implementation, not standard) -Introduce proportionality and simplified implementation in Regulation for SMEs -Not accept other EMS (would create verification problems) -Innovative idea: Replace EMS with requirements on key management activities and performance, to focus more EMAS on performances. -Standardise statement content with indicators -Liberalise statement format -Clarify verification – statement validation link -Liberalise use of EMAS logo EMS: Performance improvement / reporting:

10. EMAS EVALUATION (V) WG II Interim Results -Clarify definition Legal Compliance in Regulation -Clearly put LC verification responsibility to verifier -Create mechanism to involve MS enforcement authorities -Create single procedural requirements for LC verification -Very little room to improve current situation - Single accreditation system unrealistic - Single verification, CB procedures unrealistic - Not necessary to regroup NACE codes -Clarify role / tasks of AB, verifier, CB Legal Compliance: Accreditation / Verification / Competent Bodies:

11. PRESENTATION OVERVIEW 1) TIMING 2) EVALUATION 3) SCENARIOS 4) DETAILED PROPOSAL

12. 4 SCENARIOS ANALYSED 1) Develop a world-class EMAS 2) Re-inforce the scheme 3) Keep as current 4) Terminate the scheme + - Scenario:Evaluation:

13. SCENARIO 1 – WORLD-CLASS EMAS (I) Fundamentally reappraise EMAS with the aim to: -Rapidly expand number of organisations, especially towards SMEs -Clearly make EMAS ‘the benchmark’ for legal compliance, performance improvement and reporting Objective: - Problems facing EMAS are well-understood - Strong revision is only chance to turn EMAS into what it should be: a true, sizeable, alternative to ‘command-and- control’ EU Environmental legislation Rationale:

14. SCENARIO 1 – WORLD-CLASS EMAS (II) -Clearly position EMAS as standard of excellence -Simplify implementation to open EMAS to SMEs -Make EMAS Global -Provide meaningful incentives to organisations -Improve the institutional set-up of the scheme -Add optional reporting options Changes required: Pros: Only chance to improve EMAS significantly Cons: Some changes difficult to reach agreement on Risks: Smooth transition with current EMAS needed Potential impact:

15. SCENARIO 2 – RE-INFORCE CURRENT SCHEME (I) -No major changes to the scheme content / ambition -Only changes to make the current scheme run better Objective: -Since many changes after 1st revision: leave time to organisations to accustom to EMAS II -Drop in registration after EMAS I replaced by numbers up again & higher political support in some Member States Rationale:

16. SCENARIO 2 – RE-INFORCE CURRENT SCHEME (II) - All useful content from guidelines in Regulation - 3 years cycle for statement validation - One registration for organisation in several MS -No more need to print statement -Slightly increase support (promotion, incentives) - Single accreditation, verification, registration Changes required (limited and low depth): Pros: No significant effort needed from MS / Commission Cons: Only little improvement and no chance for much wider diffusion, especially towards SMEs Risks: Low uptake = continue to raise credibility questions Potential impact:

17. SCENARIO 3 – KEEP THE SCHEME AS CURRENT Leave EMAS as current, to allow maximum stability Objective: Same as Scenario 2 Rationale: None Changes required: Pros: No effort needed – maximum stability for new MS Cons: No improvement and no chance at all for much wider diffusion, especially towards SMEs Risks: Criticism for no action Potential impact:

18. SCENARIO 4 – TERMINATE THE SCHEME (I) Abolish EMAS, while minimising heavy criticism and major discontent from involved stakeholders Objective: -EMAS should close as it missed some of its target -EMAS ‘problems’ will take time to solve + cost efforts -Any changes proposed are uncertain to succeed - Alternative to EMAS (e.g. ISO14001) exist Rationale:

19. SCENARIO 4 – TERMINATE THE SCHEME (II) -Slowly reduce all resources allocated to EMAS - at Commission level - at Member State level -Remove from Regulation obligation to promote / inform Changes required: Pros: Financial & human resources set free for potential new initiatives Cons: No plan B; cost decrease slowly, political struggle continues; closure = return to ‘command-control’; opportunity loss to turn EMAS into successful tool Risks: Difficult to gain acceptance for this scenario; Commission credibility suffers Potential impact:

20. PRESENTATION OVERVIEW 1) TIMING 2) EVALUATION 3) SCENARIOS 4) DETAILED PROPOSAL

21. EMAS REVISION Detailed proposal – Scenario 1 – World-class EMAS 1. Position EMAS as standard of excellence –Reinforce Legal Compliance –Reinforce Performance improvement –Reinforce Reporting 2. Simplify implementation to open EMAS to SMEs –Simplify Environmental Management System –Simplify the institutional set-up of the scheme 3. Provide meaningful incentives to organisations –Make EMAS Global –Improve EMAS promotion –Add optional reporting options –Increase incentives at Member States and EU level

22. POSITION EMAS AS STANDARD OF EXCELLENCE (I) Reinforce Legal Compliance (1) Clarify and unify legal compliance requirements to make EMAS a true support to MS regulators Objective: -Little incentive granted by MS regulator -Different way of checking EMAS legal compliance in MS -No clear definition of who checks what how in Regulation -LC mentioned in 11 different places in Regulation Rationale:

23. POSITION EMAS AS STANDARD OF EXCELLENCE (II) Reinforce Legal Compliance (2) -Clearly define in Regulation: -What is Legal compliance -Role of organisation, verifier, competent body -Mechanism to involve MS regulator -List of minimum generic points to be checked Changes required: Pros: clearly position EMAS on its value added, more clarity for organisations and regulators Cons / Risk: clarification may be perceived as strengthening and scare organisations; no certainty MS Regulators will provide incentives Potential impact:

24. POSITION EMAS AS STANDARD OF EXCELLENCE (III) Reinforce Performance Improvement (1) Clarify and unify performance improvement requirements to make EMAS a true performance oriented instrument Objective: -No clear definition in Regulation of: - what is performance improvement - how is should be measured  No systematic measurement by organisations  No comparison between organisations  No market or regulatory reward Rationale:

25. POSITION EMAS AS STANDARD OF EXCELLENCE (IV) Reinforce Performance Improvement (2) -Clearly define performance improvement in Regulation -Set requirements to organisations to: - Measure performance based on a set list of generic KPIs - Report on reasons for missed targets Changes required: Pros: clearly position EMAS on its value added, more clarity for organisations and regulators; better comparability; more focus on political priorities Cons / Risk: clarification may be perceived as strengthening and scare organisations; no certainty MS Regulators or market will provide incentives / rewards Potential impact:

26. POSITION EMAS AS STANDARD OF EXCELLENCE (V) Reinforce Reporting (1) -Reporting main differentiating factor to ISO 14001 -Current reporting requirements not very prescriptive => Different requirements to organisations from verifier, CB => No comparison possible between organisations -Report mainly used by Competent Bodies -No market or regulatory burden relief reward - Clarify & unify reporting content to make EMAS a true reporting instrument + free reporting format and dissemination to make EMAS a true marketing tool Objective: Rationale:

27. POSITION EMAS AS STANDARD OF EXCELLENCE (VI) Reinforce Reporting (2) -Standardise reporting content, incl. with list of indicators -Fully ‘liberalise’ reporting format -Fully ‘liberalise’ validated information dissemination -Validation of report every 3 years vs. 1 years for SMEs Changes required: Pros: clearly position EMAS on its value added, more clarity for organisations and regulators; better comparability; more focus on political priorities Cons / Risk: clarification may be perceived as strengthening and scare organisations; no certainty MS Regulators or market will provide incentives / rewards Potential impact:

28. SIMPLIFY IMPLEMENTATION (I) Environmental Management System (1) -ISO14001 (current EMAS EMS) perceived as too complicated for SMEs -Direct link between EMAS and ISO detrimental to EMAS uptake (EMAS positioned as ISO+) -EMAS value added in performance, legal compliance, reporting, not EMS, yet biggest part in Regulation - Simplify EMS implementation to allow more organisations, notably SMEs to join the scheme Objective: Rationale:

29. SIMPLIFY IMPLEMENTATION (II) Environmental Management System (2) -Keep ISO14001 as EMAS EMS (in Annex IA or just link?) -Introduce proportionality and simplified implementation in Regulation for SMEs Changes required: Potential impact: Pros: attractive ‘selling point’ that EMAS simplify ISO implementation; link w/ ISO will keep EMAS credibility Cons / Risk:will not solve problem of positioning of EMAS; no certainty that it will simplify EMS implementation; may be perceived as weakening the scheme

30. SIMPLIFY IMPLEMENTATION (III) Simplify Institutional Set-up (1) -Different accreditation procedures -Different verification procedures -Different Competent Bodies procedures - No clear definition of their role / tasks in Regulation  Many problems for organisations - Company registration limited at Member State level - Align all procedures for all actors (AB, Verifier, CB) in all Member States to simplify EMAS implementation Objective: Rationale: for the same Regulation

31. SIMPLIFY IMPLEMENTATION (IV) Simplify Institutional Set-up (2) -Clarify & align in Regulation role / tasks / procedures of: - Accreditation Bodies - Organisations, Verifiers, Competent Bodies, Enforcement Authorities -Enable company-wide registration, even if in several MS -Regroup NACE codes Changes required: Potential impact: Pros: more clarity / less room for interpretation for all parties involved = more similar procedures Cons / Risk: very difficult to achieve single procedures in all Member States for all actors involved

32. SIMPLIFY IMPLEMENTATION (V) Others -Write new Regulation in a more user-friendly way - No more guidelines, keep important part in Regulation - Separate specific parts for each actor (AB, verifier, CB, organisation) - Abolish necessity to print statement Changes proposed: Potential impact: Pros: Will further simplify understanding and implementation of Regulation by organisations Cons / Risk: None

33. PROVIDE INCENTIVES TO ORGANISATIONS (I) Make Emas Global (1) -Most frequent reason by Multinational companies and EU companies exporting outside of EU not to join EMAS - cannot apply same system in all countries - no knowledge outside of EU in procurement procedures -Many companies outside EU wish to apply - Open EMAS registration to organisations outside the EU to raise EMAS knowledge / interest outside the EU Objective: Rationale:

34. PROVIDE INCENTIVES TO ORGANISATIONS (II) Make Emas Global (2) -Create mechanism to allow 3rd country organisation registration under EMAS: -all 3rd country organisations or only those from EU with ops abroad? -3rd country organisation validation/registration tasks done by any EU CB or negotiate with each country to create own CB? Changes required: Potential impact: Pros: will address the single most frequent criticism of EMAS Cons / Risk: must not undermine credibility of scheme (EU vs. 3rd country legal compliance); higher CB worlkload?

35. PROVIDE INCENTIVES TO ORGANISATIONS (III) Improve Promotion (1) -Still very low knowledge / big mis-conceptions on EMAS -Very big difference in level of EMAS promotion by MS -Little pan-european promotion + follow-up -Organisations cannot use statement for mkting purpose -Organisations cannot use logo for mkting purpose - Increase promotion activities by MS and Commission - Increase possibilities for organisations to promote EMAS Objective: Rationale:

36. PROVIDE INCENTIVES TO ORGANISATIONS (IV) Improve Promotion (2) -Increase promotion by Member States -Stronger mandatory requirement to MS in Regulation -Create reporting mechanism on MS promotion activities -Create pan-EU promotion strategy and actions -Liberalise use of the EMAS Logo Changes required: Potential impact: Pros: Higher EMAS knowledge will create snowball effect Cons / Risk: Logo on products may cause confusion with EL; not certain all MS will promote more EMAS

37. PROVIDE INCENTIVES TO ORGANISATIONS (V) Optional Product Reporting (1) -Product dimension already in EMAS but weak -Companies want possibility to produce 3rd-party-verified product reports -Currently finalising Guidance on how to consider the product dimension within EMAS Objective: Rationale: -Give EMAS organisations possibility to create product information report certified under EMAS

38. PROVIDE INCENTIVES TO ORGANISATIONS (VI) Optional Product Reporting (2) -Option in Regulation to make certifiable product report  Credibility of information provided? (full LCA, information from the EMS)  Standard reporting requirements, format? Changes required: Potential impact: Pros: create new value added for organisations; could be used in public / private bids; Cons / Risk: may be perceived as entering eco-label territory; no certainty market will provide rewards, market demand unclear

39. PROVIDE INCENTIVES TO ORGANISATIONS (VII) Optional Social/ Sustainability Reporting (1) -Growing trend to report on social / sustainability issues (although still mainly limited to big multinationals only) -No 3 rd -party-verified CSR management system exists (GRI, etc but guidelines only) -EMAS pure focus on environment until now -Recent COM communication on CSR – industry-led Objective: Rationale: -Give EMAS organisations possibility to report on social / sustainability information under EMAS

40. - Option in Regulation to report on social issues  Verification of information provided?  standard reporting requirement / format? Changes required: Potential impact: Pros: create new value added for organisations, even though not creating full CSR system Cons / Risk: lose opportunity to spearhead new trend if not full CSR scheme; no certainty market will provide rewards, market demand unclear PROVIDE INCENTIVES TO ORGANISATIONS (VIII) Optional Social/ Sustainability Reporting (2)

41. PROVIDE INCENTIVES TO ORGANISATIONS (IX) Increase Incentives (1) -Existing EU incentives not really useful to organisations -Member States incentives generally work better -However, very different picture in different MS -Together with EMAS Global, single most requested change by organisations for EMAS III is more incentives Objective: Rationale: -Provide meaningful incentives to EMAS organisations at Member States and EU level

42. -Set mandatory requirements to MS to: - Provide financial/ fiscal/ market-related incentives - Reduce the administrative burden -At EU level, link EMAS with: - ETS (verification as part of EMAS) - IPPC (reduce permit renewal timing / cost, etc) - Others to be identified Changes required: Potential impact: Pros: Create new value added / interest from organisations; answers their most frequent request Cons / Risk: Will be difficult to achieve changes required PROVIDE INCENTIVES TO ORGANISATIONS (X) Increase Incentives (2)