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As sustainability efforts intensify globally, industries grapple with the significant impact of regulatory measures aimed at reducing environmental degradation. Business process outsourcing (BPO) is among the sectors stuck at the crossroads of compliance and efficiency.
Third-party providers have become pivotal in the global landscape as corporations continuously outsource to streamline their operations. However, the BPO industry is not immune to the sweeping changes brought by environmental regulations.
From emission control to waste management, BPO operations are under scrutiny. Let’s explore how strict green mandates reshape this scalable practice in top outsourcing hubs.
Key environmental regulations affecting BPO operations
The functions of BPO vary depending on the nature of work and a client’s industry. Service providers deliver quality services and flexible resources at competitive pricing regardless of the client’s niche. They optimize their robust solutions to help boost front- and back-office operations.
However, similar to other sectors, the outsourcing industry must follow strict environmental standards to avoid costly sanctions. BPO firms develop and implement eco-friendly efforts to help achieve sustainability. Their first step is to understand and comply with these critical environmental laws.
The Emergency Planning and Community Right-to-Know Act
The Emergency Planning and Community Right-to-Know Act (EPCRA) guides local districts in keeping the public and the environment safe from chemical hazards. The law imposes penalties ranging from $67,544 to $202,635 per daily violation.
U.S.-based BPO companies in the manufacturing, research and development, agriculture, and other chemical-related fields must adhere to the following rules:
- Participate in local emergency planning committees (LEPCs) to create and execute response plans.
- Submit an annual report of toxic chemical usage, releases, and transfers to the Environmental Protection Agency (EPA).
- Maintain safety data sheets (SDS) for hazardous chemicals and make them accessible to state authorities, emergency responders, and masses upon request.
- Notify State Emergency Response Commissions (SERCs), LEPCs, and local fire departments about releasing hazardous substances that exceed acceptable quantities.
- Forward annual Tier II reports that detail the types and quantities of hazardous chemicals stored on-site to the mentioned agencies.
The Philippine Environmental Impact Statement System
In the Philippines, one of the top outsourcing hubs worldwide, Presidential Decree 1586 requires companies to assess the environmental effects of particular projects. Ratified in 1978, this law mandates firms to submit an environmental impact statement (EIS) to ensure the implementation of eco-friendly activities.
This proactive approach helps authorities, proponents, and affected communities address program risks immediately. It aims to maintain the balance between socio-economic development and environmental protection.
Besides the service-level agreement (SLA) terms, the policies and procedures below detail what BPO firms need to comply with. Abiding by these environmental regulations lets Philippine-based providers avoid the high expense of violations:
- Prepare and submit an EIS to the Department of Environment and Natural Resources (DENR) for approval.
- Allocate resources and funds for environmental impact studies, consultations, and strategy development initiatives.
- Incorporate sustainable practices into daily operations, including energy-efficient infrastructure deployment and waste management.
- Interact with environmental groups to address concerns, collect insights, and showcase commitment to responsible business handling.
- Regularly monitor and report eco-friendly measures and environmental performance rates.
The General Law of Ecological Balance and Environmental Protection
The General Law of Ecological Balance and Environmental Protection (LGEEPA) outlines provisions to protect, preserve, and restore ecological balance in Mexico, a popular nearshore outsourcing provider. The law aims to foster the sustainable use of natural resources while achieving economic gains.
Mexico-headquartered BPO organizations, especially those focused on renewable energy, agriculture, and production, must prepare and submit environmental impact assessment (EIA) reports. These documents evaluate the possible ecological effects of their activities and inform appropriate mitigation measures.
Providers must also comply with the rules and regulations below to guarantee streamlined BPO operations:
- Adhere to emission limits, waste management practices, and other environmental performance criteria.
- Secure environmental permits and business licenses before initiating or providing support services.
- Create and exercise proper waste management systems and recycling practices.
- Implement conservation efforts while using natural resources and avoid over-extraction or contamination.
- Engage with local communities for environmental outreach programs and information sharing.
- Execute global climate change mitigation and carbon footprint reduction efforts.
The E-Waste Management Rules of 2016
India is the sixth-largest market worldwide for environmental technology exports. It also ranks second for the global subsectors of air pollution control and solid waste recycling. Hence, the Indian government implements its E-Waste Management Rules of 2016 to regulate the country’s generation, collection, and disposal of electronic waste.
The law requires information technology (IT) and tech manufacturing companies to collect and dispose of or recycle e-waste during the production or expiration of any electronic equipment. It covers service providers focusing on tech development, production, and support services.
In addition, BPO companies must adhere to these environmental regulations to ensure smooth operations:
- Register with appropriate authorities for importing, manufacturing, or using electronic equipment.
- Create and carry out an e-waste management plan that details the methods for proper electronic equipment handling, storage, and disposal.
- Work with authorized e-waste recyclers to ensure proper disposal mechanisms and fulfill extended producer responsibility (EPR).
- Document the process of transferring e-waste to licensed collection centers or recyclers.
- Regularly submit reports to the State Pollution Control Boards (SPCBs) or the Pollution Control Committees (PCCs) to show compliance with the e-waste disposal mechanisms.
- Train staff on the proper disposal of electronic equipment and promote awareness about e-waste management.
BPO and environmental regulations: Effects of non-compliance
Not abiding by environmental policies and procedures has significant consequences for companies. For instance, Toyota Motor Company paid a $180 million civil penalty after failing to meet EPA’s emission-related defect reporting requirements.
Depending on the nature and severity of violations, BPO providers might also encounter costly fines when they do not comply with relevant environmental laws. Aside from lawsuits and financial penalties, here are the other consequences of non-compliance:
- Reputational damage due to negative publicity and stakeholder criticism
- Business suspension and license revocation
- Loss of enterprise clients and partnerships
- Operational delays and decreased productivity
- Increased company insurance premiums or limited coverage options
- Costly cleanup, restoration, and mitigation activities
What an environmentally compliant BPO partner should be
An environmentally compliant service provider is firmly committed to environmental responsibility and sustainability. The BPO company works to obey relevant environmental regulations and minimize its carbon footprint.
The third-party vendor also exercises practices that contribute to the environment’s well-being and preservation. So, if you seek an eco-friendly BPO company, note that it should:
- Have a clear understanding and up-to-date knowledge of environmental laws
- Host innovative sustainability programs that match primary environmental rules
- Deploy an environmental management system as part of daily operations
- Execute or participate in waste reduction and recycling initiatives
- Use energy-efficient technologies and solutions
- Adopt renewable energy sources and optimize data center operations
- Implement energy-efficient transportation practices to offset carbon emissions
- Practice transparency regarding environmental plans and report related progress
- Regularly train employees on ecological policies and sustainability projects
- Support environmental education programs and local conservation initiatives
- Continuously improve and innovate environmental technologies and techniques
The bottom line
As the global business landscape becomes increasingly aware of environmental concerns, BPO companies embrace sustainable practices and ensure regulatory compliance. They understand and incorporate eco-friendly policies with their operational strategies and processes.
By doing so, providers avoid the high cost of legal proceedings, penalties, and mitigation efforts. They also contribute to the growing effort to address climate change and foster environmental sustainability.
However, you must note the abovementioned characteristics of an environmentally compliant BPO firm before hiring one. This way, you can match your sustainable techniques to ensure streamlined operations. Let’s connect if you want to experience working with a BPO partner that is fully compliant with environmental regulations.
