If you ever wanted proof that today’s manufacturers are operating within a Global Village, you need only look at the impact that new chemical regulations coming out of Europe are having on businesses around the world.
I’m talking about REACH – Registration, Evaluation, Authorization, and Restriction of Chemical substances – a regulation currently rolling out that requires any business selling products in the European Union to provide a thorough account of the chemical substances contained within that product.
Never before has an international or federal agency demanded a more in-depth chemical inventory report from its manufacturers.
Because parts and other goods get shipped into the EU every day, anyone who even supplies parts to an EU manufacturer will need to be able to provide complete REACH information if they hope to stay competitive and move their product.
However, the ripple effect extends even further: entire supply chains are feeling the pressure to supply thorough chemical inventory reports for their products, since the OEMs at the top of the food chain are relying on their suppliers to help them be REACH compliant.
In short, the European Union’s REACH regulation is far-reaching indeed, and making a big splash in nearly every industry in North America.
A Constant Flood of Questions
That’s why we’re not surprised that more and more we’re hearing that supply chain managers, compliance officers, environmental specialists, VPs of sustainability, and Corporate Social Responsibility hawks are all feeling overwhelmed at the sheer number of new questions they feel REACH is asking them to address.
As anyone involved with EH&S knows, there’s already a long list of obligations and demands that need to be met every day:
“What is our carbon footprint and how can we lower it?”
“Are we using the most efficient materials for our product?”
“Are there banned substances or conflict minerals in any of our products?”
“Will air emission limits slow down our production this month?”
“What changes to existing regulations will have an impact on my reporting process?”
… and so adding “How does REACH affect our business and how can I comply with it?” to that list has got some EH&S specialists feeling the pressure.
Our Winning Philosophy for Easier Compliance
At ERA Environmental, we have a straightforward philosophy when it comes to dealing with new regulations like REACH and for addressing that ever-growing list of questions that race through the minds of EH&S professionals:
When it comes to complying with any environmental regulation, your goal should be to understand what materials are in your products and how those materials get processed to create those products.
Watch this video, where we use the automotive industry as an example of how to comply with REACH:
Think of it this way: instead of having an unending list of questions to answer for every regulation, the majority of the work is done by asking yourself these two straight-forward questions:
- What materials are used to create my product?
- How do I process these materials to create my product?
The goal of every chemical inventory regulation is to account for the human health and environmental impacts that your products (and the materials in them) are responsible for. That applies to REACH, to Canada’s NPRI, and to the U.S.’s annual Toxic Release Inventory (TRI). At their core, they are asking you to answer those two basic questions above. The differences between them typically come from how you are required to report your findings, whether it’s a specific form, a different deadline, or unique web reporting tool.
A Systematic Approach for Finding Answers
No matter what type of environmental regulation, new or simply updated, you have to deal with in the coming months, you’ll need to be able to answer those two fundamental questions before you can get into actual compliance reporting.
In fact, you’d be shocked at how many EH&S managers are busy worrying about REACH compliance but aren’t yet doing the work of figuring out exactly what goes into their products. In most cases, they aren’t prepared to answer those two questions as thoroughly as REACH demands because they don’t have the correct systems in place.
REACH demands a much higher level of accuracy than most of the environmental regulations in North America, and so the degree of scrutiny that supply chains need to apply to their vendors is not yet being met by the data sharing systems or material data sheets being implemented.
For example, the material data sheets that most paint and coating suppliers provide for their products are not 100% accurate and instead usually offer a close estimation of chemical constituencies because A) vendors need to protect proprietary mixes and B) most emissions reports accept the fact that manufacturers don’t always know 100% what is in their coatings. Most EH&S mangers pick a number somewhere near the middle of the estimated range provided by their vendors, and the EPA understands that.
However, REACH is applying a much more intense pressure on the entire supply chain, and having even a few small information gaps could be disastrous.
There's a shift towards applying the concept of 100% Chemistry - knowing 100% of what goes into your products and being able to completely account for everything coming into and out of your facility. While just a concept rather than a business practice, 100% Chemistry is a good mantra to keep in mind when prepping for regulatory compliance.
That’s why the best method of answering questions about what goes into your product is to have a comprehensive system in place for automatically collecting, processing, and managing your incoming and outgoing chemicals. The more you can securely automate things, the closer you come to 100% Chemistry and mastery over your own products.
Plus, the more you can automate your data collection and the more secure your system is, the greater returns you’ll see in terms of accuracy and saved time. Having a secure data sharing system means that your suppliers can upload significantly more accurate chemical data with confidence, which in turn makes you more capable of providing the high-resolution data that REACH demands.
If you feel like an unending pile of questions is resting on your shoulders regarding REACH, or any of your other compliance obligations, ask yourself: do you know exactly what materials go into your product and how those materials are used in your facility? Those questions hold the key to every other question you’ll need to answer.
Do you have a system in place for answering those two all-important questions?
July 11, 2013