Late spring for DTI's Acorn supply chain project for smaller firms

A Government-sponsored programme to help small and medium enterprises (SMEs) gain ISO14001 certificates has attracted only 19 companies in its first 18 months of operation. Poor understanding of modern supply chain networks may be to blame - but, encouragingly, the firms involved are positive about the project's benefits.

Project Acorn was launched by the British Standards Institution (BSI) in May last year with a target to recruit 250 companies within two years (ENDS Report 300, pp 31-32 ). The initiative received £500,000 from the DTI in its first year and will receive undisclosed sums for a further two.

A not-for-profit organisation, Acorn Trust, has been formed to distance the project from the BSI, and the initiative has been merged with another DTI project to examine how indicators based on the ISO14031 standard on environmental performance measurement might be employed in the greening of suppliers.

Acorn aims to bring together larger companies as "mentors" for their SME suppliers. Performance indicators help gauge progress along the way. It offers a five-level approach to implementing an environmental management system compatible with ISO14001, with a sixth level compatible with the EU eco-management and auditing scheme, EMAS.

Eighteen months on, only 19 SMEs have been recruited. The aim was to have an equivalent number of mentor companies, but it appears that just four - Rolls Royce, Severn Trent, United Utilities and Marks and Spencer - are involved so far.

Janet Gasgoine, Acorn's director, played down the slow start. "It was quite a task just to devise and develop the project model," she said. Acorn would still meet its 250 SME target, she insisted - though she accepted that the involvement of mentor companies was very variable with "some more hands-on than others."

The main barriers to SMEs improving their environmental performance are a lack of time, money and expertise, according to Ms Gasgoine. "Managers in SMEs often have lots of different roles and do not have the resources to devote to environmental issues," she said.

One mentor company in the project said that Acorn's limited uptake was due to a lack of understanding of the modern supply chain network, which has become more complicated. "Very few SMEs supply big companies directly now," it explained. "Most SMEs supply first-tier companies who in turn supply us."

The company also warned against an unfocused approach, saying "it all depends on bigger companies identifying SMEs in their supply chain who represent the biggest risk and working with them."

Despite these hiccups, active mentor companies and SME participants are very positive about the benefits of the Acorn approach to ISO14001 certification.

Nigel Marsh, environment manager for Rolls Royce, said that his company "has a reputation for quality and wanted to work with similar companies." Getting certification to environmental management standards would help suppliers demonstrate this.

Rolls Royce's supply chain accounts for a significant proportion of the company's environmental impact. A recent survey showed that only 2% had ISO14001 or EMAS certification, although 40% claimed they were "working towards" it. Mr Marsh said Rolls Royce was looking at ways to encourage greater take-up of ISO14001-compatible management systems by firms in its supply chain.

Terry McManus of Tekdata, which supplies cable assemblies to Rolls Royce and other companies in the aerospace, IT and telecoms sectors, said that Acorn provided a "valuable approach to breaking down certification into bite-sized pieces."

The main business benefit of Acorn is as a "strategic, order-winning marketing tool which gives us an edge over our competitors," he added. Tekdata is hoping to be certified to ISO14001 shortly.

Martin Burke of Kennedy Utility Management, which supplies civil engineering services to United Utilities, agreed that Acorn provides a "useful competitive advantage".

Mr Burke added that an important benefit of the Acorn approach was its use of performance indicators based on ISO14031 which added value from day one. The main indicators identified were the amount of solid waste going to landfill, and consumption of virgin aggregates and fuel.

Kennedy gained certification to ISO14001 for services it provides to Transco - which, although not involved in Acorn, requires all contractors to have management systems compatible with the standard.

Marks and Spencer, a mentor to three Acorn firms, is also enthusiastic about the benefits. Environment manger Mike Barry said it is considering methods of greening its supply chain and that Acorn may be one option.

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