There’s a growing global consensus that we’re at a crossroads on the environment. Not only do we face the increasingly urgent challenge of climate change, but we are also witnessing unprecedented demands on energy and fuel, water and material resource scarcity, huge population and life expectancy growth, concerns about food security, and a growing consumerism in the East that is putting an added strain on the global store of raw materials. Resource productivity improvements could satisfy nearly 30% of demand by 2030. Recent rises in global GDP and inroads into tackling poverty have largely been achieved by increasing economic growth. But the resource- dependent models that have allowed this to happen can no longer be sustained. In the past, increases in productivity have often come through more efficient use of labour, but the opportunity for further gains here is limited. To continue to make progress we need to squeeze more out of the resources at our disposal. ‘Resource efficiency’ will become the new watchword of sustainability. Accenture and the World Economic Forum recently produced a report looking at how to make consumption more sustainable by decoupling growth from environmental impact. They suggested that $2 trillion manufacturers of products that worth of economic output could be at risk by 2030 if major global economies fail to respond to shortages in the supply of just one resource - iron (and, more importantly, the steel that comes from it). This demonstrates the scale of the challenge we are up against. Accenture and the WEF conclude that ‘the need for rapid action to shift towards a resource-efficient economy is high’ - and that despite some successes to date, ‘change is now. More positively, greater resource efficiency also creates a business opportunity; it improves productivity, reduces costs and enhances competitiveness. If companies are less dependent on the availability of certain raw materials, they are less vulnerable to supply fluctuations and hikes in prices. This in turn means they can offer customers a more reliable supply of their products.

1. Cut The Fluff Series 3
Resource
efficiency – the
new watchword
of sustainability
By Ramon Arratia
June 2012
www.interfaceflorcutthefluff.com
www.interfaceflor.eu/gobeyond

2. Resource efficiency – the new watchword of sustainability
Resource efficiency – the new
watchword of sustainability
There’s a growing global consensus that we’re urgently required at a scale and greater pace than
at a crossroads on the environment. Not only current initiatives, policies or strategies are likely to
do we face the increasingly urgent challenge achieve’.
of climate change, but we are also witnessing
unprecedented demands on energy and fuel, They also argue that businesses, rather than
water and material resource scarcity, huge governments, need to play the major role in making
population and life expectancy growth, concerns this happen. And this is not just a question of a few
about food security, and a growing consumerism businesses taking the lead. To achieve this urgent
in the East that is putting an added strain on the transition, every company must deliver resource-
global store of raw materials. efficient growth.
The management consultancy McKinsey
Resource productivity sees things in a similar light. Its recent study,
improvements could satisfy Resource Revolution: meeting the world’s
energy, materials, food, and water needs,
nearly 30% of demand by 2030. argues that resource productivity improvements
could satisfy nearly 30% of demand by 2030.
Recent rises in global GDP and inroads into However, it warns that only 20% of the potential is
tackling poverty have largely been achieved by readily achievable and 40% ‘will be hard to capture’.
increasing economic growth. But the resource- However, KPMG - in its own report, Expect the
dependent models that have allowed this to unexpected: building business value in a changing
happen can no longer be sustained. In the past, world - is optimistic that increasing resource
increases in productivity have often come through efficiency makes good business sense. One rather
more efficient use of labour, but the opportunity for negative incentive is that as developing countries
further gains here is limited. To continue to make industrialise rapidly and global demand for material
progress we need to squeeze more out of the resources increases dramatically, businesses are
resources at our disposal. more likely to face trade restrictions that clamp
‘Resource efficiency’ will become the new down on the use of raw materials. If companies can
watchword of sustainability. use resources more efficiently then they may be
able to prevent this eventuality.
Accenture and the World Economic Forum
recently produced a report looking at how
to make consumption more sustainable
Regulatory frameworks around
by decoupling growth from environmental the world must change to reward
impact. They suggested that $2 trillion manufacturers of products that
worth of economic output could be at risk
by 2030 if major global economies fail to
are more resource efficient.
respond to shortages in the supply of just
one resource - iron (and, more importantly, the More positively, greater resource efficiency also
steel that comes from it). creates a business opportunity; it improves
productivity, reduces costs and enhances
This demonstrates the scale of the challenge we competitiveness. If companies are less dependent
are up against. Accenture and the WEF conclude on the availability of certain raw materials, they are
that ‘the need for rapid action to shift towards less vulnerable to supply fluctuations and hikes in
a resource-efficient economy is high’ - and that prices. This in turn means they can offer customers
despite some successes to date, ‘change is now a more reliable supply of their products.
The Cut The Fluff Series 3 Ramon Arratia June 2012 02

3. Resource efficiency – the new watchword of sustainability
The challenge of resource efficiency is beginning • ur innovative TacTiles system means carpet tiles
o
to exercise the minds of governments as well can be fixed in position without using liquid glue,
as business analysts. In September 2011 the almost banishing the environmental footprint of
European Commission produced a white paper the adhesive used in traditional carpet tiles.
on ‘a resource-efficient Europe’, which argues
• andom design tiles generate just 3-4% waste
r
that it is ‘perfectly possible to produce more value
during installation, compared with up to 12% for
with fewer inputs’, and sets out a vision for the
structural and technological changes needed to broadloom carpet.
make this happen by 2050. • ltrasonic cutting equipment is doubling
u
productivity, reducing excess trimmings and
At Interface we have already begun to take
improving efficiency. This idea was borrowed
on this challenge.
from the aeronautical industry.
LCA gives your designers a clear As KPMG has predicted, at Interface we
objective to guide the design of have discovered that new markets can
your products, focusing on reducing be found from an innovation-led focus
on resource efficiency. We’ve found, for
key impacts rather than creating example, that, our Microtuft flat carpet tiles
‘feel-good’ green gimmicks. appeal to certain regions that have not
traditionally been interested in carpets, such
Resource efficiency fits well with our ‘Mission as Spain, Italy or the Nordic countries. In some of
Zero’ goal of delivering zero negative impacts on these countries Microtuft now accounts for more
the environment by 2020 while maintaining and than 40% of our sales.
even improving profitability. Since 1996 we have
made concerted and successful efforts to reduce But despite clear business benefits, we have
our use of resources, not least because using mainly been treading this path because we believe
less material reduces production costs. Today, for it is the right thing to do. If other companies are
instance, our waste costs per unit of product are to embrace this radical agenda - in their tens of
41% lower than they were in 1995. thousands as Accenture and WEF suggest – then
as a society we need to create incentives for them
We have introduced several to explore and take up resource efficiency.
successful measures on radical That means current regulatory frameworks around
resource efficiency: the world must change to reward manufacturers of
• e have created Microtuft, a new range of
w products that are more resource efficient.
carpet tile with around 50% less yarn than
conventional carpet. Yet this has not
sacrificed performance, as the biggest If EPDs were the norm, then
contributor to both carbon footprint and the it would be easy for everyone
depletion of petrochemical resources is the to know which products have
nylon yarn in carpet.
more or less impact in terms of
• rom all our raw materials purchased
f resource efficiency.
globally, 44% are recycled or bio-based,
saving a significant amount of virgin
resources. The best place to start is from the central point of
Environmental Product Declarations (EPDs).
• e introduced a 100% recycled nylon in 2011,
w
even though we had been told in the 1990s that An EPD reveals the ingredients of a product, its
this would be impossible. More than 140 colour methods of production, and the full environmental
shades in our product range now use this 100% impact of each stage of its life cycle, measured
recycled material. in several impact categories such as impact on
The Cut The Fluff Series 3 Ramon Arratia June 2012 03

4. Resource efficiency – the new watchword of sustainability
climate change (kg CO2 eq), water use (litres) or
From 2010, if the average CO2 emissions of a
acidification (kg SO2 eq), to name but a few. The
manufacturer’s fleet exceeded its limit in any one
right measures will highlight any reductions in
year, the company had to pay an excess emissions
resource use. premium for each car registered. With such
significant financial implications, the impact of this
approach was almost immediate. Within
In France, the authorities are looking just one year of the regulation coming into
at introducing a requirement that force, for example, the UK car industry had
all environmental claims related to achieved a reduction in tailpipe emissions
of more than 5%, compared with just
products must be based on an EPD. 2.2% in the eight years up to 2006.
A similar transformation could be achieved
EPDs are becoming more prevalent in Europe: they in other sectors by applying a focus on resource
are already widely used in the construction sector, efficiency through EPDs at European level, linking
for example. And at Interface we have committed performance to financial penalties or rewards.
to produce EPDs for all our carpet tiles. If EPDs
were the norm, then it would be easy for everyone If common ‘magic metrics’ can be agreed by
to know which products have more or less impact product category and measured through EPDs,
in terms of resource efficiency. That would be then the European Union can set minimum
good news for procurers, who are struggling to standards, rewards and penalties – as well as
establish which of the products they need to buy industry targets - based on those metrics at
is better for the environment. It would also be good EU level.
for consumers who want to buy more ethically. And
good for companies to benchmark against. As an increasing number of companies focus on
EPDs, they are quickly discovering where they
If EPDs are universally adopted, we will also have a can increase their resource efficiency. So if the
clear and simple basis for assigning tax benefits to EU wants to help business move in this direction,
products that have greater resource efficiency. For then it must harness the power of EPDs as soon as
example, the best products could qualify for lower possible.
product taxes (such as VAT) over a period of time.
Additionally, EPDs could eliminate
greenwash. In France, the authorities are
A visionary landfill ban by 2020
looking at introducing a requirement that all would spark into life a new industry
environmental claims related to products producing post-consumer raw
must be based on an EPD. This would be a materials, as opposed to just
neat way of making EPDs the norm without
dictating that they should be mandatory.
focusing on waste management.
One of the best ways to appreciate the
Another way of increasing resource efficiency
potential transformative power of EPDs in this
would be to ban landfill. A visionary landfill ban
area is to look at the progress made by the
by 2020 would spark into life a new industry
European car industry since a 2009 EU regulation
producing post-consumer raw materials, as
introduced EPDs as the basis for requirements on
opposed to just focusing on waste management.
tailpipe emissions.
Bans could be implemented immediately on the
The regulation required car manufacturers to landfilling of certain items where best available
decrease average tailpipe emissions across their recycling technology is already available, and this
portfolio to 130gCO2/km by 2015 and 95gCO2/ would scale up existing technologies. At Interface
km by 2020. This forced each manufacturer to we are lobbying for a European ban on the landfill
create an EPD for each of its cars based on of carpet even as we continually improve our
gCO2/km. technology to recycle carpet tiles.
The Cut The Fluff Series 3 Ramon Arratia June 2012 04

5. Resource efficiency – the new watchword of sustainability
About Interface, Inc.
Established in 1973, Interface, Inc. (NASDAQ: IFSIA) is the worldwide leader in design, production
and sales of environmentally responsible modular carpet, manufactured for the commercial and
institutional markets under the Interface® brand, and for consumer markets as FLOR™.
The company is also a leading designer and manufacturer of commercial broadloom and modular
carpet under the Bentley Prince Street™ brand.
Interface was one of the first companies to publicly commit to sustainability in the mid-nineties, and
the company has been widely recognized for its achievements in this area since then. Its products
have also achieved numerous awards specifically for design and innovation, the most recent being
The Athenaeum Good Design Award for World Textiles.
About the author
Ramon Arratia is the Sustainability Director Interface EMEAI. His focus is on continuing to develop the
company’s sustainability strategy towards Mission Zero as well as reviewing products, services and
business processes to ensure that they are as sustainable as possible.
Ramon plays a leading role in Interface’s ‘Let’s be clear’ campaign, an anti-greenwash drive calling
for full transparency in how companies declare the environmental impact of their products. He
has also been instrumental in Interface commitment to have all products covered by Environment
Product Declarations (EPDs) by 2012. Ramon is also leading Interface’s ‘war on waste’ campaign,
an initiative which calls for action to change European Waste Legislation within the flooring and
construction industry.
The Cut The Fluff Series 3 Ramon Arratia June 2012 05