About SMITE

The methodology for the development of web-based Diagnostic Tools for the evaluation of environmental performance of businesses is being presented.

The Diagnostic Tools evaluate environmental performance on the basis of the business operational data. A limited set of environmental indicators is being calculated, and the business environmental performance is compared to that of its competitors as well as to literature data, representing the concept of the "Best Available Techniques".

The performed diagnosis results at the identification of potential environmental problems in the daily operation of a company. The model suggests actions of minor and/or greater cost to be undertaken in order to improve environmental performance and calculates the potential benefit on the operational cost. The overall objective is to assist SMEs to increase their competitiveness and thereby their position in the market.

The SMITE Approach

A model has been developed to stimulate SMEs to conduct environmental audits and self-evaluate their environmental performance. The Internet-based tool that has been developed is supporting SMEs to:

• Evaluate their environmental performance and assess its evolution over time.
• Benchmark their performance against competitors at regional and international level.
• Adopt "Good Practice" and/or Cleaner Production Guidelines for improving their environmental performance.
• Evaluate economic benefits from the adoption of the above measures.

Environmental Performance Variables and Indicators

The evaluation of the environmental performance of the targeted industries is based on a simplified set of performance indicators, which allow individual industries to be benchmarked on a regional and international scale. The indicators are estimated on the basis of performance variables provided by companies. These are distinguished in organizational variables (management and business variables) and environmental variables. The above variables are expected to be available for companies, and they can be used as inputs for the estimation of performance indicators. Performance indicators are normalized measures of performance, in essence simple ratios of two variables. According to the so far proposed measurement framework, the most common variables used as denominators to construct environmental performance indicators are:

• A standardized unit of production for a given sector (e.g. tonnes of product).
• Total sales for a given company.
• Number of employees.
• Value added (total value of sales minus total cost of materials).

The derived indicators can be generic or sector specific. In this approach, a set of generic indicators, complemented by sector specific ones, is considered a reliable representation of a company's environmental performance. The proposed set of indicators has been proved to be not only representative, but also reducing complexity while retaining flexibility.

Industries effect a large number of interactions with the environment. These include:

• Consumption of renewable and non-renewable resources
• Water consumption.
• Energy consumption.
• Waste and wastewater discharge.
• Air pollution, etc.

The multiple dimensions of environmental performance evaluation and assessment are evident. One of the most difficult issues that arise is selecting whether to proceed in producing aggregated measures of environmental performance or not. The multidimensional evaluation of environmental performance is avoided by presenting separately the proposed set of performance indicators. The challenge is to produce simple environmental indicator figures, which allow individual industries to be compared on a regional and international scale.

Comparison is further complicated by the changes over time, which occur eventually in the business production. These changes may affect the environmental indicators of individual industries. The challenge posed is handled through the selection of few generic indicators. The indicators are applicable to the specific sector allowing for some unexplained variations, thus permitting a general comparison without too much complexity.

Environmental Performance Evaluation and Benchmarking

Inputs for the model

Inputs are data and other operational information of the companies, which are usually available. These data are required for the calculation of environmental indicators and include other relevant information for further studies on the environmental performance of the sector. Inputs are distinguished in:

Company profile data, such as:

• Type of products and processes.
• Number of employees.
• Sales value.
• Raw materials cost, e.t.c.

Technical data, such as:

• Energy consumption (all types of energy resources reported).
• Water consumption.
• Raw material used.
• Products produced.
• Non-product output to water, land and air.

Evaluation of environmental performance and benchmarking

Environmental performance evaluation is implemented through a restricted set of environmental indicators, as they have been previously described. Indicators are calculated by the model, and their current as well as previous values are presented to the user.

Environmental performance evaluation is followed by benchmarking. Companies are guided to compare their current performance to the median values of the same set of indicators, for the same sector, from a sample of competitors in the region (regional benchmarking). Regional values of environmental indicators are produced and updated by the model, based on the input database.

Benchmarking is completed by BAT values, which represent the Best Available Technology - state of the art performance (international benchmarking). BAT values are provided by the relevant literature and case studies at the international level, relevant to each one of the targeted sectors.

Following the environmental evaluation and benchmarking, technical interventions and practical measures are suggested to the users to reduce environmental impacts and consequently improve business competitiveness through cost savings. The basis for recommendations is the current environmental performance recorded at the previous step and the comparative evaluation with best practices and target values. For each indicator, there is a reference to an "Opportunity Bank" containing suggestions on how to improve performance. The Opportunity Bank serves as a guide for the SMEs aiming to improve environmental performance by means of cleaner technology.

Potential cost savings from improved environmental performance

Having evaluated the business environmental performance, the model estimates at the final step the excessive costs related to their current performance, and the potential cost savings achieved when applying BAT. These cost savings are calculated separately for each individual performance indicator and their sum represents the total potential operational cost savings.

Administrative/Operational Performance Evaluation and Benchmarking

Administrative/operational performance indicators

The improvement of environmental performance requires effective control of company's activities, products and processes that may cause significant environmental impacts. Consequently, current management practices that influence environmental performance should be identified so that required changes could be introduced.

Management decisions and activities that influence the company's environmental performance, e.g. implementation of an Environmental Management System or environmental training of employees, are generally evaluated by "effort" indicators. Qualitative and quantitative effort indicators are registered and evaluated by companies to assess their administrative/operational performance. At the next step, companies' performance is being benchmarked against other industries of the same sector at a national / regional and international level.

• General awareness performance

The inputs required by companies, simplified in order to be easily available, are processed by a weighted score method in order to evaluate the company's level of general awareness on environmental issues. After identifying which criteria will be used for performance evaluation, each criterion is assigned with a relative importance and a weighting factor. These factors are used for measuring the company's final score.

• Quantitative performance

Quantitative evaluation of administrative performance is implemented by input data, referring to management practices towards environmental performance improvement and the results of their implementation (Figure 6). These data can be easily processed to give a set of administrative performance indicators, which are directly comparable and can be further used for benchmarking.

Administrative/operational performance benchmarking

The calculated values of administrative performance indicators as well as the weighted total score of environmental awareness are communicated to the companies compared to the median value of all inputs at the regional level and to the Best Practices values at an international level.

Legislative Compliance

The legislative diagnosis is be based on the respective legislation of each country for the selected sectors, and the relevant EU environmental legislation. The basic requirements of the most significant legally binding documents are shortly presented.

A set of questions inquiring the status of compliance of the company against National or European Legislation are then given, where the possible options for answer are YES/NO/PARTIALLY.

Evaluating the level of compliance

The level of compliance to the respective legislative framework is presented through a "Summary Report" indicating the number of questionnes that have been answered, and the respective number of laws/regulations that the company is in compliance with or not. At the next step, additional information is given to the user, taking into account the "weak" points of the company's legislative compliance. In order to assist the users, the basic requirements of each law are presented, and the possibility to study the full document is offered.