17 July 2008

Aluminum Giant Attracts Praise for Protecting the Environment

Alcoa engages communities to make business expansion smoother, cleaner

This Alcoa smelter in Iceland was built with significant community input to reduce its environmental impact. (Alcoa Inc.)

By Andrzej Zwaniecki
Staff Writer

This article is the fourth in a series on sustainable manufacturing.

Washington -- Alcoa Incorporated, the leading global producer of aluminum and aluminum products, is to the environmental movement what a teacher’s pet is to teachers.

The company, which operates in 44 countries, is consistently praised, honored and recognized in other ways as one of the world’s top companies for practicing responsible environmental stewardship. Alcoa’s “2020 Strategic Framework for Sustainability” sets ambitious goals, and the company has achieved some goals well ahead of the schedule.

Experts say that Alcoa does everything an exemplary sustainable manufacturer should do: reduces use of resources, reuses some products and materials, recycles materials that cannot be reused and constantly rethinks industrial processes.

For example, Alcoa uses increasingly lighter, more flexible packaging that is reusable, recyclable or compostable.  It recycles more than half of aluminum beverage cans in North America. (By 2015, it hopes to increase that share to three-quarters.) Recycling aluminum saves 95 percent of the energy needed to make new metal.

The company strives to make products in key markets friendlier to the environment. For example, its Dura-Bright wheel improves fuel efficiency, eliminates cleaning products and extends tire and brake life, bringing down customer costs.

Alcoa believes that embracing sustainability -- efforts to make products without harming the environment or using up scarce resources -- will ultimately help its bottom line. 

In 2004, Alcoa turned over nearly 10,000 acres in the Little Tennessee River watershed to the Nature Conservancy for preservation.

“We believe that addressing sustainability will make us a better company, and a better company becomes a company of choice for governments and communities,” Anita Roper, Alcoa’s director of sustainability, told The Journal of Record. “This designation leads to better access to land, markets, capital, resources and people.”

The company views suppliers, customers, employees, shareholders and communities in which it operates as its key stakeholders. But it puts more emphasis than many other corporations on the welfare of communities that host its plants.

When Alcoa plans major business expansion in the midst of a community, Roper said, the company engages in a dialogue that “helps [us] understand [residents’] expectations and also helps them understand us.”

The approach allows Alcoa to address critical issues early in project design and operation and helps it enhance environmental performance, avoid unintended social problems and create better working conditions.

When the company took a plan to upgrade its refinery in Pinjarra, Western Australia, to the community, locals asked Alcoa to place the next residue storage area away from the township. By granting this request and making other improvements, the company incurred higher up-front costs but it won long-term acceptance.

In another country, Iceland, Alcoa encountered apprehension from environmentally conscious residents of Reydarfjordur when, in the early 2000s, it announced a plan to locate in the economically depressed area a new smelter powered by a hydroelectric station constructed for its exclusive use.

As a result of unusual cooperation with local stakeholders, who were invited to form an advisory group, “the tremendous construction … has gone very smoothly, whether you look at employer’s safety, environmental matters or communication with the society,” Helga Jónsdóttir, mayor of the nearby town of Fjardabyggd, told Supply Chain Management Review magazine.

The smelter is considered one of the safest, most efficient and environmentally friendly facilities of its kind in the world. The project has made many companies that worked on it more sensitive to health, safety and environmental issues.

Some of the most ardent environmentalists remain unpersuaded that the new smelter is a good thing for the area. But many locals agree with Davíð Baldursson, a Christian minister who served on the advisory committee, when he says, “These projects have given us renewed hope for the future of our community.”

More information on Alcoa’s sustainability strategy can be found on the company’s Web site.