Does CSR increase financial gains, profits, and corporate performance? ISO standards seem to help make private actors more profitable. A new study shows that companies that adopt ISO 14001 certification are more competitive and more efficient, win more contracts and get higher profits.
The ISO 14001 standards are a set of international standards describing the procedures to be followed to develop an environmental management strategy in companies. Companies that implement a strategy to reduce their environmental impact are guided and can be “ISO 14001 certified” if they follow the standards pointed out by the norm. In the CSR world, ISO 14001 certification works a guarantee of quality in the environmental management systems of the organizations. When an organization is certified, it is known that it has proper procedures in place to measure, reduce and manage its environmental impacts.
But is this certification a good investment for companies? Many experts believe that having an ISO 14001 certification allows companies to be more profitable, saying it allows them to (positively) increase their brand reputations and allow companies to develop their network among suppliers and vendors. But is this really the case? What are the benefits of ISO 14001 certification from a financial and economic point of view? Does this certification really make companies more competitive? Let’s take a look at one of the latest studies on the links between ISO 14001 certification and business performance.
ISO 14001 standards help increasing market share
According to a survey conducted by the British Assessment Bureau, the ISO 14001 standards do have a positive effect on business competitiveness. According to this study, 66% of companies using ISO 14001 standards say they have either directly won contracts thanks to their certification, or have been able to participate in calls for tender where it was mandatory to have the certificated. This seems to prove that more than besides working as guidelines for companies who wish to improve their environmental systems, ISO 14001 might sometimes also be a necessary tool to access certain markets.
Indeed, more and more large ISO 14001 certified companies, especially in Europe, are asking their suppliers and other companies among their supply chain to obtain ISO 14001 certification in order to operate with them. This is also the case on the public markets where due to their sustainable development strategies, communities usually require environmental certifications for their tenders. In fact, 13% of certified companies even claim to have been able to keep some contracts that would have been lost if they hadn’t gone through a certification process – another example that the influence of ISO 14001 is becoming stronger.
After all, we can say that the ISO 14001 reference is becoming an important and very relevant norm in the market that works as a tool that companies can use to demonstrate that they are concerned about their environmental management systems. And in the ends, the ones who worry and are certificated will be better off than those who do not have it when it comes to winning contracts. But does the ISO 14001 hold any other benefits?
The multiple benefits of ISO 14001
From a business point of view, ISO 14001 has many benefits. As it is gradually becoming an essential business norm, particularly for public markets and for large European organizations and businesses, it is turning into a key to access certain markets and to get and/or keep contracts.
On the other hand, ISO 14001 is an effective management system that helps reduce costs on several levels like energy bills, waste management, raw materials, and logistics. As a result, companies setting up an environmental management system using the ISO 14001 standards are able to save money on these items. Besides this, implementing the ISO 14001 has also the potential to increase leadership involvement the engagement of employees and furthermore increase teamwork and the chances for internal innovation within the products or services themselves.
Therefore, the ISO 14001 standards seems to be good for business, making companies more competitive and improving their financial performances. From another point of view, it also helps companies being more eco-friendly. What are businesses waiting for then?
Demonstrate compliance with current and future statutory and regulatory requirements • Increase leadership involvement and engagement of employees • Improve company reputation and the confidence of stakeholders through strategic communication • Achieve strategic business aims by incorporating environmental issues into business management • Provide a competitive and financial advantage through improved efficiencies and reduced costs • Encourage better environmental performance of suppliers by integrating them into the organization’s business systems
If you’re interested in finding out more about other ISO standards: