News & Views

Life Cycle Assessments Can Reduce Costs and Improve Brand Identity: Deloitte

01/06/2012

Organizations can create value by conducting Life Cycle Assessments (LCA) to analyze a number of sustainability metrics to better inform business decisions and activities, says a new Deloitte report. LCA is designed to measure and quantify the end-to-end environmental and economic impacts of a product, process or service in alignment with specific sustainability goals. 

 

“Enhancing the Value of Life Cycle Assessment,” outlines how LCA can be used to rigorously examine environmental impact across the entire product life cycle from development, sourcing and manufacturing through distribution, marketing, use and disposal. Many organizations have traditionally pursued value creation from sustainability by focusing on internal activities. However, some companies are realizing that the majority of their environmental impacts lie within the supply chain. Resource use and its associated wastes – such as inefficient consumption of energy, water or raw materials – represent real costs to suppliers and customers.

 

“LCA can be an effective data-driven way of uncovering surprising insights,” says Sanjay Agarwal, principal, Deloitte Consulting LLP. “This information may lead to opportunities to collaborate with supply chain partners to reduce cost and risk through a decrease in energy, water, waste and carbon consumption and to drive revenue growth through new product innovations.”

 

As part of the LCA process, organizations should spend ample time engaging cross-functional stakeholders to define their objectives and then leverage the appropriate LCA toolset that is right-sized to inform their business decision.  This will help arm them with insight on environment benefits and specific areas for improvement to determine brand integrity and alignment with sustainability goals.

“Enhancing the Value of Life Cycle Assessment” provides examples of how customized LCA studies can support significant sustainability objectives, including the ability to:

  • Identify cost savings: Provides a data-driven approach to identifying potential operational efficiencies through reducing energy use, material consumption, water consumption, waste generation and emissions.
  • Enhance brand value for competitive differentiation: Compares the environmental impact of an organization’s product to alternatives to determine which benefits are distinguishable.
  • Improve design decisions: Evaluates resource and materials use to inform product and process design decisions that increase environmental efficiencies.
  • Make better procurement decisions: Engages multiple stakeholders and suppliers to allow organizations to make procurement decisions that significantly boost their sustainability efforts.
  • Meet communications needs: Provides a platform for authentically communicating positive environmental attributes about products to buyers and consumers.
  • Achieve compliance: Addresses regulatory mandates at local, national and international levels.
  • Create better policies: Evaluates internal and external policies of the organization to determine realistic objectives.

To view the “Enhancing the Value of Life Cycle Assessment” report please visit : http://www.deloitte.com/us/sustainability/LCA.

 

About Deloitte’s Sustainability Services Group

Deloitte’s sustainability services group draws on the insights and experience of Deloitte’s four primary businesses – Consulting, Audit, Tax and Financial Advisory Services – and industry-specific practices across corporate strategy and operations, supply chain, mergers and acquisitions, human capital and enterprise risk management.  The result is a broad set of capabilities to address a range of domestic and global business opportunities and risks related to energy supply, demand and efficiency, water and other resource scarcity, carbon and greenhouse gas regulation and demand for increased transparency and confirmation of non-financial performance.  For more information, please visit: http://www.deloitte.com/us/sustainability

 

Consulting LLP, a subsidiary of Deloitte LLP.  Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.  Certain services may not be available to attest clients under the rules and regulations of public accounting.

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Deloitte

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Global Brand & Corporate Communications
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mperriard@sustainablebrands.com