Defining Eco‐efficiency: A Case Study on the Finnish Forest Industry

Abstract

Environmental reporting is a tool of corporate environmental management that can also be used as research material. The aim of this paper is to produce a comprehensive definition of eco-efficiency based on the literature and then compare it with definitions identified in the environmental reports published by selected companies. In addition, this paper presents a conceptual framework of the relationship between environmental and economic performance in the companies. Three Finnish companies in the forest industry are selected as case companies. This analysis reviews environmental reports published by the companies from 1998 to 2007. In short, eco-efficiency can be seen either as an indicator of environmental performance, or as a business strategy for sustainable development. The case companies very seldom give an exact definition of eco-efficiency in their environmental reports. However, different aspects of eco-efficiency are often referred to.definitions can be classified into five types. We also suggested a conceptual framework for the E/E relationship. From this framework resource intensity, environmental intensity, average resource price, resource productivity and eco-efficiency can be identified and defined.The second objective of this article was to compare the theoretical definitions of eco-efficiency with the definitions identifiable in the environmental reporting of the selected case companies from the Finnish forest industry. The case companies (Stora Enso, UPM-Kymmene and M-real) do not directly use the term 'eco-efficiency', and therefore a coherent definition of eco-efficiency cannot be identified. However, it is obvious that the case companies have improved eco-efficiency in many ways. The most typical ways of improving eco-efficiency include (1) bringing a life cycle perspective into environmental management, (2) reducing the energy intensity of the production, (3) enhancing recyclability and (4) maximizing the use of renewable raw materials. 562M. Koskela and J. Vehmas

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