Changing the paradigm to address society's challenges
We are living in a highly uncertain and unstable environment, marked by an increasing number of political, social, environmental, economic and public health crises.
To face this, we must work collectively on several fronts. In Quebec, this means rapidly decarbonizing our activities, protecting and restoring biodiversity, supporting social justice and strengthening the resilience of local economies.
These transformations require us to deeply rethink our ways of being in the world, of producing and consuming. However, there is still a long way to go to change the paradigm. For example, the circularity gap report by RECYC-QUÉBEC and Circle Economy is clear: of the 271 million tons of resources consumed each year in Quebec, the vast majority are not cycled back into our economy¹. To address this, we need to better understand the value chains and develop synergies between different local actors in order to achieve a more circular economy.
Major challenges for businesses
Businesses have a key part to play in the transformation of the Quebec economy and society.
For example, if they want to support greenhouse gas emission reductions and reach Canada's target of a 40% to 45% reduction by 2030², companies must not only cut emissions from their direct activities, but also help reduce the emissions of other stakeholders in their value chain. Indeed, up to 90% of emissions come from assets that are not owned or controlled by the reporting company³. This is a significant challenge as supply chains become increasingly complex and globalized, and a significant portion of consumer products and goods are produced outside of Canada⁴.
In their impulse to improve their environmental performance, companies must also be careful not to move their direct environmental impacts up or down their value chain or to another impact category (e.g., with the electrification of transportation, shifting from a climate change impact to an impact on mineral depletion). Evolving towards a corporate social responsibility extended to all stakeholders is essential to address the issues facing Quebec society. This calls for greater measurement of organizations' societal impacts in order to increase transparency across the value chain. On this last point, significant progress is expected in the years to come with the recent creation of the International Sustainability Standard Board⁵, which aims to manage international extra-financial reporting standards for businesses.
Finally, organizations must also deal with a growing pressure from consumers who are increasingly interested in what's behind the product or service they consume. Eight out of ten Quebecers are looking for more sustainable products, and more than half of them believe that companies do not provide enough information regarding the conditions under which products are manufactured⁶. In short, consumers have increasingly high expectations when it comes to corporate social responsibility.
Building a holistic understanding with life cycle thinking
Using life cycle thinking is an appropriate way to address these challenges. Indeed, this approach aims at recognizing that corporate decisions have an impact on what happens at every stage of a product or service's life cycle. This perspective allows the company to make choices that are beneficial to the environment, to society and to the economy.
For an organization, the life cycle approach means assessing the environmental and social impacts of all the activities along the organization's value chain: direct activities (such as design, manufacturing processes and distribution), but also upstream activities (such as the extraction of raw materials and the manufacturing of components) and downstream activities (like the use of products and services and their end-of-life).
Depending on the data available, this assessment can be done either at a qualitative level, to identify the activities in the value chain that have the greatest impacts, or at a quantitative level, which opens the possibility of comparing products and services with each other in order to choose the option with the lowest impacts.
Life cycle assessment (LCA) is the most widely used tool of the life cycle approach to quantify the environmental impacts of a product or service. This evaluation method is normalized internationally (ISO 14040 and 14044).
Multiple benefits, illustrated by two case studies
Through life cycle thinking, companies have a global understanding of their value chain and can identify opportunities to improve their environmental performance. This translates into benefits for the company on several levels, such as:
- Improved efficiency of the organization's processes, which can also generate economic benefits due to a reduction in the amount of resources needed and an increase in productivity;
- Strengthened synergies between the departments that have to work together to solve complex problems in the value chain;
- New collaborations with stakeholders outside the organization to develop solutions within and across sectors;
- Increased resilience to regulatory changes;
- Greater credibility and reputation of the organization that shows leadership in terms of social responsibility.
The following two case studies illustrate in a concrete way how companies can benefit from the adoption of a life cycle approach.
A Quebec-based furniture manufacturing company generates sawdust that is contaminated during the manufacturing process, making it unsuitable for use in agricultural settings. The sawdust therefore ends up in landfills, generating significant financial costs and environmental impacts. Taking a broader perspective, the company created a working group with external stakeholders to find innovative ways to decontaminate the residual material using fungus, as well as to find energy recovery outlets for the contaminated material. In addition to creating synergies with other local players, this initiative helps divert 200 tons of waste from landfills and save several thousand dollars per year⁷.
On the opposite side of the planet, a Malaysian solvent-based adhesive manufacturing company is feeling increasing pressure from its customers about the environmental impact of its products, and is rethinking its practices and market. What can the company do about a shrinking local market for adhesives? How to manage a manufacturing plant with aging machines and workers close to retirement? How to improve a product that is hazardous to human health during production and end use? Using an environmental hot-spot analysis, the company identified risks throughout its supply chain. The company decided to launch a new line of water-based adhesives that are safer for the environment and human health, and to create a coalition with some suppliers to build a new value chain. Investment funds decided to join the initiative and provided funds to renew the equipment. Modernizing the plant reduces health problems and increases productivity, attracts new talent, and opens up opportunities in a new market for eco-designed products. These new products are gradually replacing old ones. The company's revenues are increasing by 10%. This Malaysian company recognizes that the global transition to more eco-designed production is a business opportunity⁸.
COESIO supports you in this transformation with our expertise in "life cycle approach".
Increasingly aware of the impact of their value chain, companies are now choosing the life cycle approach to develop their products and services in line with their environmental commitment.
COESIO offers to assist company managers in the deployment of an optimal structure for life cycle thinking. This support is divided into three main stages designed to develop a global understanding of the environmental impacts on your organization's entire value chain, and to identify action levers for systemic improvement.
The life cycle approach is integrated into our EVO2030 Program, a unique approach in North America for the continuous improvement of your overall corporate performance towards achieving the 17 UN Sustainable Development Goals (SDGs) for 2030.
EVO2030 will allow your company to better understand the sustainability issues that affect you directly, to be proactive in addressing the global climate crisis, to take into account the environmental and social impacts of your operations, and to better manage your organizational process with innovative or proven solutions.
All in all, it is a comprehensive support for the creation and implementation of a credible and ambitious organizational approach, which will allow your company to successfully evolve towards a sustainable development perspective.
Companies wishing to participate in the EVO2030 Program are invited to complete the application form on the EVO2030 website. You will receive a meeting date and a preparation survey within 72 hours of your request.
To learn more about the EVO2030 Program, please visit the official website atwww.evo2030.com or attend one of our launch events.
Where does your organization stand?
We are pioneers in helping organizations reinvent their business model to better meet new market demands, effectively manage risks and seize new opportunities to improve their overall performance.
Through our unique approach (learn more), we have helped multiple organizations turn sustainability into a viable business strategy. We have worked with companies with different levels of maturity when it comes to integrating sustainability.
For more information, please contact:
Charles Duchesne, President, Executive Director and Partner
Marius André, Director of operations and Partner
Léo Queinnec, Analyst