Ben Franklin: “Nothing can be said to be certain except death and taxes”. If Franklin were alive today, he would have many items to add to that statement. In the electronics industry – and its supply chains – a contemporary item he would include is product environmental compliance.
Since the European Union (EU) passed the Restriction on the use of certain Hazardous Substances (RoHS) and Waste Electrical and Electronic Equipment (WEEE) directives in 2003, the world has begun to pay more and more attention to product environmental compliance. Eco-Compliance legislation impacting the electronics Industry and its supply chains has grown exponentially. Jurisdictions implementing legislation that impacts the electronics industry include: China, South Korea, Japan, Taiwan, Argentina, Brazil, Chile, Columbia, Venezuela, Canada and United States of America. Many are similar to the European Union’s legislation; but none are using it verbatim.
In addition to RoHS and WEEE legislations, the EU instituted an updated regulation regarding chemicals, mixtures, and articles. Registration, Evaluation, Authorization of Chemicals Regulation (REACH) began affecting the electronics industry a few years ago, and has now become the basis for many compliance activities.
What’s expected in 2010?
Remember “2010: A Space Odyssey” and the question – “What’s going to happen now?” No one has a crystal ball to foresee the future, but there are some major changes proceeding within the global product environmental compliance space. The EU is revisiting the RoHS directive, China is working on their first RoHS product catalog, and many more jurisdictions are enacting take-back legislation for electronic waste.
In addition to RoHS and WEEE-type legislations which focus on electronics, some jurisdictions are investigating and enacting more general regulations of chemicals and substances within products. Legislations such as EU REACH and the California Green Chemistry Initiative focus on all products, not just electronics.
RoHS – European Union
In the EU, the RoHS and WEEE directives are currently under recast – the EU term for rewrite and review. The first reading is to be in early 2010. Some of the anticipated modifications are:
- Change in scope from specific categories to an open scope of all electronics unless specifically excluded
- Recasting the RoHS Directive as a New Approach Directive (CE Mark)
The discussion of open-scope will eliminate the misinterpretation of whether or not a particular product is within the scope of EU RoHS. The discussion of including the RoHS directive within the New Approach directives will significantly impact how companies approach compliance going forward. If recast as a New Approach directive the RoHS directive will then require products to have CE certification and be labeled with the CE mark to indicate compliance. This means companies will need to maintain and be able to present supporting documentation to an auditor when asked.
RoHS – People’s Republic of China
Also expected in the first half of 2010 is the publication of China’s initial product catalog for its RoHS-type legislation. A draft of the product catalog was published for comment in October 2009. A brief comment period of 30 days allowed for industry review and input. As part of the draft publication, a timeline was given for publication of early 2010 – likely February. Within the draft, an implementation period of 10 months was drafted. Based on this, if the draft catalog is agreed to and published in early 2010, enforcement to the new catalog could happen as early as 01 January 2011.
Products included within the draft catalog were listed as: phones (land-line and mobile), computer printers and mobile terminals. For each of the products listed within the catalog, allowances for specific use of restricted substances were listed. These are very similar, though not exactly the same, as some of the exemptions allowed within the EU’s RoHS Directive and its amendments.
Chemicals Regulation – EU REACH
As product environmental compliance continues to expand, all roads are pointing towards chemicals regulation, such as the EU’s REACH Regulation. Not unique to the electronics industry and its supply chain, REACH impacts all products. Though the main focus affects chemical and mixture manufacturers, it does have requirements for articles manufacturers (e.g. product manufacturers). There is still debate over whether or not to include sub-components of products.
With REACH impacting the entire supply chain for all products, it has solidified the movement of product environmental compliance to a process based approach. Some highlights of REACH are listed below. Look for more information in the other articles in this issue for the specifics of REACH and its Substances of Very High Concern (SVHCs).
- Only a handful of SVHCs used within electronics
- Additional substances expected to be added annually
- Information disclosure required where SVHCs are present
- Disclosure information for other substances once over threshold amounts.
When companies started working on RoHS compliance in 2002-2003, most were taking the approach of “we’re going to do this once and be done”. This is no longer the case: laws are constantly changing and methods used by enforcement bodies are constantly evolving. The need for a process-based approach is vital. Companies must be able to sustain, maintain and adjust their program in a variety of ways. A proactive approach, not simply reacting to changes, is a must to stay on the path of product environmental compliance.
The project-based approach of “one and done” has been debunked by many companies. Companies now have teams of people working on product environment compliance, not just component engineers gathering data sheets. In 2008, the Consumer Electronics Association report estimated the amount spent on RoHS compliance within the electronics industry was over $32B USD. This amount was just the amount spent on RoHS, not REACH or WEEE. Since then, more and more companies are working towards compliance with more than just the EU RoHS directive. Companies are dealing with regulation and compliance in almost every industrialized jurisdiction they ship product.
In Figure 1, the CEA estimation is expanded to include all environmental compliance legislation impacting products. The figure represents an estimation and extrapolation of the money spent per the CEA report by electronics industry (and its supply chain) for each new, product-based environmental compliance legislation or regulation. REACH will eventually eclipse RoHS – as more and more companies will demand full materials declaration from their supply chain to assist in the process-based approach for compliance with multiple jurisdictions and legislations. The amount spent each year will continue to increase as laws continue to be enacted, revised and expanded around the globe. Implementing a process-based approach is becoming an industry norm. If there is one thing you take away from this article, it should be that product environmental compliance is an evolving process; not a “one and done” project.
Figure 1: Annual spend on meeting environmental compliance legislation
With the constant changes to product eco-compliance legislation, a process needs to be implemented when preparing and maintaining a product environmental compliance program. If a project is started for each new variation of legislation, there will not be continuity within the system, nor the ability to compare information gathered for different jurisdictional requirements. Total product environmental compliance needs to be rooted in a process based approach.
Elements of a process based approach are shown in Figure 2. Many companies have some of these elements within an internal program; others have several sources they use to complete their program. You must have information on all the pieces of the pie to have a totally compliant program. If you would like more information on the figure below, please e-mail the author for copies of the previous publications.
Figure 2: Elements of a Total Compliance Solution
Lessons Learned & Best Practices
Lesson 1: Implement a process approach to product environmental compliance
With the constant changes to product eco-compliance legislation, a process needs to be implemented. If a project is started for each new variation of legislation, there will not be continuity within the system, nor the ability to compare information gathered for different jurisdictional requirements.
Throughout the years, best practices within product environmental compliance have been established. As these best practices relate to implementing a process approach to compliance, the next three lessons learned and best practices all highlight the importance of the ultimate best practice – a process based approach.
Lesson 2: Be ready for an audit
Audits are no longer just being done by government or enforcement agencies. Some companies are requiring their suppliers to pass an internal audit before continuing to do business with that supplier. An average small company with non-complex products takes around three months to gather basic information. To implement a complete product environmental compliance program, it takes around six months. Neither companies – nor enforcement agencies – will wait while you put the information together. In the case of being audited by the enforcement authority in Ireland, a turn-around time of 24 hours is expected for all compliance materials.
A best practice is to be ready for an audit at any time. Remote access to data & information allows for instant access to compliance information. Technical compliance files should include: component data, corporate policies and procedures, classification/justification documents, roadmap(s) of activities, and use of any exemptions or allowances within the legislation.
For part data and information within the database, it should be searchable by component, part number, supplier status, substance, exemption/variation, just to name a few criteria. From reports in 2008 and 2009, almost 50% of companies fail compliance audits for RoHS. The top reasons for failure were responsiveness, completeness of information, sustainability of program, and misuse/misinterpretation of exemptions.
Lesson 3: Gather full materials declarations
With more and more countries creating requirements for materials reporting requirements or materials restrictions – such as RoHS-type and REACH-type legislation, full materials declarations information is becoming more and more prominent. Countries with existing requirements are looking at adding additional substances.
If you are able to gather full materials information by weight, it allows for manipulation of the data regardless of the regulation. Gathering full materials information is a best practice when working on multiple environmental requirements. In addition, it is recommended the information be listed in a database by CAS number. This allows for the ability to search database for a specific substance when it is called into question.
Lesson 4: Stay current
Education is a corner stone of a successful implementation and maintenance of a product environmental compliance program. With changes happening to existing legislation and new legislation being drafted or created, one needs a variety of tools for keeping informed. Some of the best sources for up-to-date information are: industry involvement or industry events; targeted reports – not general knowledge databases or “tech rags”; or a targeted news service. There is good information available on blogs or listserv – but be wary of this information as much of it is opinion, not fact. Make sure the information you’re using comes from a reputable source and can be verified.
Its not easy going green… but the rewards are tremendous
“Going Green” – in terms of product environmental compliance – is a conscious corporate decision. It is a change to critical thinking and the way your company does business. It is a corporate decision to prepare for the future and go beyond simple substance restrictions declarations. It is designing a product to account for the product’s end of life requirements which impact waste management.
It is compliance – not chaos. It is a crisp presentation of corporate environmental stewardship within its products. A company needs to eliminate the risks of not being able to provide accurate and complete product environmental compliance information to auditors or customers. The inability to provide this information in a timely, organized manner can ultimately lead to a finding of non-compliance.
There are internal as well as external pressures for maintaining compliance records. Some are customer’s requirements; others are legislative or governmental requirements. The move to substance-level declaration requests and responses are a best practice – a major movement away from simple yes/no material declarations. More and more companies are expecting or requiring full materials information. The key to successful product eco-compliance is program sustainability: implementation of a systemic, process-based approach to gathering, maintaining, and reporting product environmental compliance information.
Do not fall victim to being unprepared for a product audit. In the EU, as an example, Member States will make an example of a company whose product fails to meet its directives and regulations. Start a process-based approach to product eco-compliance of documenting products today.
It keeps going and going and going…
We’re way beyond RoHS and WEEE at this point. Product eco-compliance requirements continue to expand and change. The two major things to remember when implementing a compliance program:
- A process-based approach should be implemented for product environmental compliance activities. It is no longer a “one and done” project.
- Product environmental compliance requirements are not going away, and will continually change and evolve.
Any electrical or electronic equipment sold in the world will need to comply with a product environmental legislation at some point. Ben Franklin may have given rise to our title… but the Energizer Bunny® brings it home – the requirements keep “going and going and going…”
Krista Botsford, Botsford EcoTech Partners LLC, can be contacted at email@example.com or by visiting www.BotsfordEcoTech.com.