Improving environmental impact and cost assessment for supplier evaluation

Improving a company's environmental and financial performance necessitates the evaluation of environmental impacts deriving from the production and cost effects of corporate actions. These effects have to be made transparent and concrete targets have to be developed. Such an evaluation has to be done on a regular basis but with limited expenses. To achieve this, different instruments of environmental controlling such as LCA and environmental performance indicators have to be combined with methods from cost accounting. Within the research project CARE(1), the method Resource Efficiency Accounting (REA) is used to give the participating companies new insights into hidden costs and environmental effects of their production and products. The method combines process based cost accounting with environmental impact assessment methodology and offers results that can be integrated into a company's environmental controlling system and business processes like cost accounting, supplier assessment, etc. Much of the data necessary for the combined assessment can be available within a company's IT system and therefore can be efficiently used for the assessment process. The project CARE puts a strong focus on the use of company data and information systems for the described assessment process and offers a methodological background for the evaluation and the structuring of such data. Besides the general approach of the project CARE the paper will present results from a case study in which the described approach is used for the evaluation of suppliers.