Commissioner Environmental Sustainability Victoria

2 SF 6 PFCs 2

HFCs 4

Strategic Audit Structures for sustainability

Environmental management systems in the Victorian Government 2011 CO

Published by the Commissioner 2 for Environmental Sustainability Melbourne, Victoria, 2011 ©The State of Victoria, Commissioner for Environmental Sustainability 2011 This publication is copyright. SF No part may be reproduced by any process 6 except in accordance with the provisions of the Copyright Act 1968.

Printed by: Impact Digital Units 3 & 4, 306 Albert Street Brunswick, VIC 3056 N O Utilising solar power Printed on: Recycled paper 2 Authorised by the Victorian Commissioner for Environmental Sustainability, 16/570 Bourke Street, Melbourne, Victoria 3000

ISBN 978-1-921147-17-3 For further information contact the Office of the Commissioner for Environmental Sustainability, PFCs phone +61 3 8636 2197 or visit http://www.ces.vic.gov.au

Disclaimer This report may be of assistance to you and every effort has been made to ensure that the information provided is correct. It is based HFCs largely on data and information provided by the Victorian Government. The Commissioner for Environmental Sustainability does not guarantee that the report is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or other consequence which may arise from you relying on any information in this publication. CH 4 Contents

From the Commissioner ______5

Why we bother - A climate scientist’s perspective ______8

Part 1 Organisational Structures, Sustainability and Environmental Management Systems _____ 12

Part 2 Agencies: Case Studies on Environmental Sustainability ______28 Parks Victoria ______31 Zoos Victoria ______35 Public Record Office Victoria ______38 Museum Victoria ______42 State Library of Victoria ______47 Victorian Electoral Commission______50 Film Victoria ______53

Part 3 Environmental Management Systems in Action ______58

Appendixes ______90

Appendix 1 Strategic audit methodology ______90 Appendix 2 Global Reporting Initiative – who is reporting? ______92

Endnotes ______93 Every good scientist is a skeptic. In fact, I would argue that every good citizen is a skeptic. We have to learn to discern, and listen to the quality and logic of an argument.

For example, we don’t understand to this day why smoking causes cancer, so we still retain an element of skepticism. But the data associating smokers with cancer is so statistically overwhelming that you would have to be a fool or a liar to deny it. It’s exactly the same in climate science. There’s an overwhelming preponderance of evidence that it’s warming, that the last thirty to forty years have been mostly due to human activities, that it’s raining more in higher latitudes, that there are more droughts and flooding, that ice is melting rapidly.

Stephen H Schneider, TNR Q&A, 9 November 2009

Stephen Scheider (1945 – 2010) was Melvin and Joan Lane Professor for Interdisciplinary Environmental Studies and Senior Fellow the Woods Institute for the Environment, Stanford University Stanford. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

From the Commissioner 5

Leadership, communication and the integration of core business and environmental goals are pivotal in every successful environmentally sustainable enterprise. Wise defaults, feedback loops and performance indicators work to support the alignment of goals and aspirations.

Major corporations across the world understand these inextricable links and are enthusiastically implementing this ‘new normal’ as best practice. The importance of environmental sustainability and associated socio-economic co-benefits was recently demonstrated in Chief Executive Officers’ responses to a survey by the United Nations Global Compact (2010).

Since at least 2003, Victorian Government departments and agencies have been taking action for environmental sustainability and working to develop this ‘new normal’. This year’s strategic audit report, Structures for Sustainability, is about these efforts: organisational commitment, wise resource use, broad sustainability issues, focused greenhouse gas reduction strategies and the associated economic and social co-benefits of resource efficiency (see Appendix 1).

This year, to gain insights about sustainability processes and co-benefits, we have explored the organisational structures and cultures which underpin and guide practical efforts. To better illustrate theoretical insights, we have considered some agency operations as examples of good and improving practice. These case studies are most instructive.

If we concern ourselves with organisational cultures in a thoughtful and purposeful way it is clear we can attain more sustainable practices and achieve co-benefits. We recognise that our responses will be personal, organisational and institutional and that they must be supported by structures and processes, centrally and in the regions (in-and beyond- office). Vital roles exist for individuals, formal and informal community groups, guilds, business and government leaders, secretaries, executives and all tiers of management in their departments and agencies.

In my view, it is important to link practical realities, theoretical considerations and scientific data. I further consider it to be increasingly necessary to see the strategic audit process in a broader context. My statutory remit authorises discussion, study and analysis of the organisational structures, and by inference cultures, which we need to understand and utilise to effect meaningful change in our resource use practices and to achieve reductions in our greenhouse gas emissions.

In Australia, climate change concerns are real and grave. We know that we are, per capita, among the highest producers of greenhouse gases. In Victoria, we have become increasingly aware of our climate change vulnerabilities.1 Recent extreme heat events and bushfires of epic and tragic dimensions, a 13-year drought and record spring and early summer rains and widespread flooding, accentuate these concerns.2 From the Commissioner

The preamble of Victoria’s Climate Change Act 2010 speaks of overwhelming climate change scientific consensus, the breadth of responsibility for action and Victoria’s particular vulnerability to adverse effects. A 20% reduction in greenhouse gas emissions has been set as the Victorian Government’s target for 2020. In light of this heightened level of concern about this issue, I have invited pre-eminent climate scientist Professor David Griggs to comment on current climate change science and our capacity to act immediately and positively to reinforce the message - ‘Why we bother’.

The Confederation of British Industry, a not-for-profit lobby group which has 200,000 members, 80% of which are listed in the FTSE 100 (a share index of the 100 most highly capitalised United Kingdom companies listed on the London Stock Exchange), advises its members on the impacts of climate change and ‘why they should bother’. The position of the confederation is that business will need to incorporate climate change policies into its DNA and that in a low-carbon future, companies will have to be green to grow. It advises its members that the nature of climate change dictates that all businesses take ownership of climate risks and those that are most resilient will have an implicit lead over their competitors.

In compliance with the provisions of the Commissioner for Sustainability Act 2003, the strategic audit this year:

> unequivocally marries the study of environmental management systems to the climate science and the benefits of resource efficiencies

> examines the organisational theory that assists us all in understanding, in a cogent and compelling way, the structures and cultures of organisations that will enhance climate change action and sustainable outcomes

> outlines a number of agency case studies for the lessons they contain and presages some interesting processes and pathways to change

> reports on the Financial Reporting Direction 24C data with a view to determining progress or lack of it in reducing greenhouse gas emissions in government

> blends the exercise of measuring data with the environmental, social and economic considerations upon which all our best efforts in environmental sustainability action and process are based. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Key messages 2010 This strategic audit tells us that we can do better, always, and we still have a way to go. It provides further impetus that the Victorian Government should:

> establish a process whereby all agency heads and other executive staff are required to include in their contracts and/or performance plans key performance indicators which give active consideration to environmental management and resource efficiency

> require departments and agencies to review their organisational structures to ensure they promote environmental sustainability and report annually on actions taken to promote consideration of environmental sustainability.

As I have done, I hope the reader will conclude that environmental sustainability is propelled by multi-level organisational commitment and the institutionalisation of the characteristics of an adaptive, learning, and open organisational structure and culture.

Professor Kate Auty PhD, MEnvSc, Dip Int Env Law (UNITAR), BA(Hons)LLB

Commissioner for Environmental Sustainability Why we bother - A climate scientist’s perspective

It gives me great pleasure to provide some preliminary comments for the commissioner’s strategic audit. Bearing in mind the old adage ‘What you can’t measure you can’t manage’, conducting an audit is a vital step towards the goal of reducing greenhouse gas emissions.

Simply measuring is, however, not enough. Measurement on its own is nothing more than stamp collecting unless it is used to instigate policies and actions. For this reason it is sometimes useful to step back and remind ourselves why we bother.

The climate science The most recent assessment of the climate science by the Intergovernmental Panel on Climate Change (IPCC), released in 2007, concluded that ‘warming of the climate system is unequivocal’ and that there is a more than 90% chance that most of the observed increase in global average temperatures since the mid-20th century is due to the increase in concentration of greenhouse gas pollution in the atmosphere. All the peer reviewed climate science since 2007 has served to reinforce and even strengthen these conclusions.

An increase in greenhouse gas pollution in the atmosphere remains the only plausible scientific explanation for the increasing global average temperatures over the past several decades. Other natural mechanisms that have warmed the Earth in the past, such as changes in solar strength, distance from the Earth to the Sun, and natural increases in greenhouse gas concentrations from volcanic eruptions currently have a weak influence on global temperatures or should be causing cooling. The Earth clearly continues to warm, despite assertions that warming stopped in 1998 and despite the cold and snowy winter being experienced this year in parts of North America and Europe.

All of Australia has warmed in the past 60 years, with the last decade being the hottest observed during this period. Many parts of Australia have also experienced unprecedented hot temperatures over the past few years. For instance, during the summer of 2009- 10 Melbourne temperatures reached at least 20°C each day for 123 days in a row. The previous record length of such a ‘warm wave’ was 78 days, back in 2001.

Global average temperatures in 2010 were the equal highest in the instrumental record and the 2000s were the warmest decade in that same record. This is supported by satellite data that are completely independent of the surface temperature record. The fact that the same warming is observed in both satellite and surface data indicates that the warming is not due to the urban heat island effect or any problems with the location or accuracy of the surface temperature observations.

We have already observed a wide variety of impacts associated with climate change. For example, in Australia we are already experiencing:

> impacts on agricultural productivity

> water shortages

> extreme weather events (fire and floods)

> an increase in heat-related illness and death

> shifts in habitat for cold-climate species

> decreasing rates of coral growth in the Great Barrier Reef. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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New research shows that if greenhouse gas pollution continues to rise unchecked, it is likely that global warming will exceed 4°C by the end of the century. Compared with impacts associated with the 0.7°C global warming we have seen over the 20th century, such a rapid increase in temperature will produce even greater warming in many regions, promote major changes in rainfall and other climate-related changes and could result in significant negative impacts on all human and natural systems.

The need to reduce emissions The science tells us that we need to start reducing emissions of greenhouse gases now.

To a first approximation, the Earth’s temperature responds to the total amount of greenhouse gases that accumulate in the atmosphere. The concentration of carbon dioxide in the atmosphere is now almost 40% higher than it was in the pre-industrial era. Global annual emissions of carbon dioxide are now 27% higher than they were in 1990, causing greenhouse gas pollution to rapidly accumulate in the atmosphere.

Recent research indicates that to have a good chance of staying below 2°C warming the world can emit a trillion tonnes of carbon dioxide during the first 50 years of this century. We have already used up a third of that budget in the first nine years. At present rates of emissions we will use up the remaining two-thirds in the next 20 years, or even earlier if emissions continue to increase according to ‘business as usual’ scenarios.

In Australia, we have a particular responsibility to do something about our emissions as we are among the highest per capita greenhouse gas emitters on Earth.

How we do it All is not lost.

Several reports such as the Garnaut Report3 and ClimateWorks Australia’s Low Carbon Growth Plan for Australia4 show that within 10 years, Australia can be well on the road to becoming a low-carbon economy and that it is possible to make this transition at low cost, using existing technology, while continuing our economic growth.

We can achieve great reductions in emissions through:

> lifestyle changes that typically save households money, such as energy demand reduction or transport modal shifts

> expenditure on more expensive technological solutions

> the purchase of overseas offsets.

In addition to the greenhouse gas savings, many pollution reduction opportunities offer significant co-benefits such as improved energy security, reduced energy infrastructure investment requirements, improved productivity and better health and welfare. For example:

> Green buildings can deliver up to a 10% increase in productivity and 40% decrease in sick days.

> Strong action on climate change has been modelled to create 3.7 million new jobs by 2030.

> Increasing the carbon content of soils can improve land fertility and productivity.

> By using less energy, Australia will be able to reduce some of the cost of new power investments and save $5 billion per year by 2020 in wasted energy costs.

> By encouraging alternative travel to the motor car, including walking and cycling, we can make significant improvements to our health. Why we bother – The climate science

As the world moves towards a low-carbon economy, the growing demand for carbon efficient products and services provides significant opportunities for Australian businesses that supply them. The expansion of clean energy, energy efficiency and more efficient forms of transport could create thousands of sustainable, long-term jobs for Australians.

The ClimateWorks Australia Low Carbon Growth Plan for Australia shows that it is possible to reduce Australia’s greenhouse gas emissions by 25% below 2000 levels by 2020 at an average annual cost to society of just $185 per household. However, it is important to bear in mind that even a 25% reduction is not sufficient to ensure Australia is adequately contributing to the international commitment to limit the increase in global average temperatures to 2°C, as agreed in the Copenhagen Accord.

What are the barriers to effecting necessary changes? So what is stopping us? Given that the science is clear that climate change is very likely to be human-induced and the potential consequences are so serious why are we not mobilising as a nation to act on climate change?

Studies of behaviour change can give some insights.

There tends to be a disconnect between people’s understanding of an issue and their behavioural responses to that issue. This is the case not only with climate change. It has been found that even after undergoing major heart surgery most patients do not make any significant attempts to live a healthier lifestyle. Further, many men, and women, fail to have regular health check-ups in spite of protracted health information campaigns, because of the fear that they will find out there is something wrong.

Analysis of the different barriers to action on climate change reveals the following:

> We do not act on climate change because we are neurologically wired to respond to immediate danger, rather than danger in another time and place. The most significant impacts of climate change are still far enough in the future and/or physically remote for most urban Australians to avoid taking action.

> We do not act on climate change because many of us still do not know what to do and if we were to act we have little confidence that our actions would make any difference.

> We do not act on climate change because it is not convenient – the infrastructure and resources are not in place to make it possible or easy.

> We do not act on climate change because it is still comparatively costly to do so – there has not been sufficient uptake of low-carbon products and services to bring down costs, or sufficient resources provided to assist with making a change, and there is no cost for continuing to pollute.

> We do not act on climate change because others do not. The question we ask ourselves is – if our neighbours, peers, colleagues and leaders won’t act, why should we?

> We do not act on climate change because government bodies and other organisations have not empowered us to do so with clear information and incentives. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The barriers are myriad, complex, interconnected, obvious and diffuse and are interpreted differently by different people.

Without strong leadership and a clear vision, these obstacles can be difficult to overcome.

This is where governments come in. Governments need to show leadership on climate change:

> in everything they do

> the policies they set

> the regulations they enforce

> most importantly by setting an example to others.

Government can do this through its formal large departments, through its smaller and more targeted agencies, as a function of its management of organisational structures and cultures, and through mandatory and voluntary environmental management programs both in and beyond office. Governments’ role and the role of heads of departments and agencies and staff at all levels of the organisational structure is of real importance in our attempts to address the climate change challenges we face.

This brings us back to why this audit is so important. Professor David Griggs

By measuring and monitoring greenhouse gas emissions, water usage and waste and CEO ClimateWorks Australia by having a clear environmental management system to enact a clear plan to reduce & Director Monash greenhouse gas emissions government is showing vital leadership. Sustainability Institute I commend the government for auspicing the commissioner to carry out this audit and for setting an example for others to follow. Part 1 Organisational Structures, Sustainability and Environmental Management Systems

Contents

Sustainability and organisations - aspirations and implementation ______13

What does organisational structure mean? And what is required for change? ______15

Why are organisational structures important in facilitating sustainability? ______16

Organisational structures and cultural change ______18

Sustainability requires new forms of organisational structures ______19

Best practice self-reflection and flexibility ______20

Broad principles regarding organisational structures and sustainability ______20 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The conduct of an annual strategic audit on the implementation of environmental management systems by Victorian Government departments and agencies is a function under the Commissioner for Environmental Sustainability Act 2003.5 The act defines an environmental management system as:

... the organisational structure, policies, practices, processes and procedures for implementing environmental management, including systems for designating responsibility for and allocating resources to, environmental management6

In last year’s strategic audit report ‘Addressing our Future’,7 we undertook to conduct audits in a manner that would provide the opportunity for government departments and agencies to improve their environmental performance. It is for this reason that this year we have examined organisational structures and their role in establishing effective environmental management systems that work to reduce greenhouse gas emissions and ensure the efficient use of resources.

In this part of the report, we examine the theory of organisational structures and consider the characteristics that contribute to successful environmental management.

Sustainability and organisations - aspirations and implementation In organisational contexts in the private sector, sustainability would appear to be ‘truly In a recent United Nations 8 top-of-mind for CEOs around the world’. In a recent United Nations Global Compact Global Compact survey survey of CEOs, 93% of CEOs stated that sustainability was important to their organisation’s success. Further, a remarkable number, 96%, asserted that sustainability of CEOs, 93% of CEOs should be ‘fully integrated’ into the strategy and operations of their organisations.9 stated that sustainability Nevertheless, and as we also find in public sector settings, there remains a gap between was important to their 10 stated intentions or aspirations and the actual realisation of goals. The United Nations organisation’s success. Global Compact CEO survey highlighted that while progress has been made, daunting implementation challenges remain and for many organisations, sustainability is yet to Further, a remarkable permeate all aspects of core business.11 Indeed, CEOs believe that ‘execution is now the number, 96%, asserted real challenge’ for sustainability.12 that sustainability should While the literature on sustainability is expansive, the focus of much organisational be ‘fully integrated’ into research is on evaluation and monitoring, with implementation remaining a mosaic and puzzle13 even as real efforts continue to be made to identify the factors that are important the strategy and operations in an organisation’s ability to successfully implement sustainability policy and practices. of their organisations. Although the scholarship on organisational structures and sustainability focuses on private corporations, the discussion in this section of the audit is directly relevant to the public sector. In many ways, agencies or departments can be viewed as the ‘business units’ of government, struggling with many of the same issues as the private sector.

In examining progress towards attaining sustainability, the literature focuses heavily upon the role of leadership and organisational culture and there is a general consensus that these factors are vital for achieving sustainability objectives.14 The research distinguishes between ‘hard’ factors such as strategy and ‘soft’ factors such as vision and culture, and suggests that all are necessary for sustainability efforts to be successful.15 Organisational Structures, Sustainability and Environmental Management Systems

In the bundle of ‘hard’ factors promoting sustainability practice, we find organisational structures16 but oddly, given its relevance, there appears to be less attention paid to the ways in which organisations have attempted to design their structures to facilitate sustainability.17

Theoretically and practically organisational structures play an important role in sustainability efforts because they significantly influence the way an organisation operates and the manner in which it ‘thinks’ (to cite anthropologist Mary Douglas). Organisational structures facilitate the manner in which their people process ideas. They change the culture of the personnel and forge strategic plans, corporate plans and other instrumental devices. As organisational theorist Doppelt suggests:

... the way the parts of a system are arranged determines how it functions. If you can reconstitute the core elements of an organisation you can change how it operates.18

It would appear that organisational structures are important for progressing sustainability objectives because they can embed sustainability within an organisation; maintain sustainability efforts; and facilitate the ongoing organisational cultural change, which is necessary to immerse an organisation in sustainability practices. The absence of organisational structures committed to achieving sustainability will, even with great, ad hoc goodwill, result in little more than superficial longevity of programs and processes – at best.

Sustainability is not merely It is clear that sustainability should be viewed as an ongoing, iterative and reflective about solving immediate, process involving continual inquiry, persistent self-examination, elevated interest in innovative learning and a commitment to continuous improvement. Sustainability is obvious issues mechanically or not merely about solving immediate, obvious issues mechanically or instrumentally. instrumentally. Sustainability is Sustainability is inherently a long-term ‘change management’ process,19 in which building inherently a long-term ‘change an organisation’s capacity to continually learn and innovate becomes central to success. It is a whole of organisation enterprise. Its very complexity makes it uncomfortable to management’ process... action for some.

Indicative of its innate responsiveness and organic roots, sustainability is unlikely to follow a linear path. Dunphy and a number of his colleagues suggest that an organisation’s road to sustainability may be mapped across a series of fairly typical phases. Even adopting a phases-of-development model presents challenges as there is inherent ‘play’ in the processes and organisations may, and often do, ‘leapfrog’ phases of development and implementation. Equally they may regress, hopefully to regroup, internalising the lessons taken from their progress from disinterest to commitment.20

Such an understanding of organisational growth is valuable because it recognises that organisations are thinking organisms that are capable of identifying and adjusting their progress towards sustainability. The phase model also provides a mechanism for comparative analysis. Organisational structures are identified as being of key importance in forging organisational progress. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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What does organisational structure mean? And what is required for change? Broadly, the term organisational structure refers to the framework that governs, coordinates and generates the activities of an organisation.21 More specifically, a structure is the pattern of roles, relationships and procedures that enable coordinated action.22

Notwithstanding this apparent simplicity and clarity, the concept of an organisational structure is much broader than is indicated by an organisational chart of lines and boxes – any organisation will breathe, it will contract and be connected by gossamer and sinews.

Seven dimensions of organisational structure

Nohria suggests that any organisational structure has seven key dimensions. These include a division of labour, which determines how tasks and responsibilities are divided among members of an organisation. Processes will pivot upon coordination mechanisms, which facilitate the blending of the independent activities of members of the organisation. Decision-rights will be distributed among members. The organisational will have set itself some meaningful boundaries and personnel will understand which activities should be undertaken inside and outside those boundaries. There will be informal structures, roles and relationships based on factors such as proximity, friendships, and shared interests. Political structures and political coalitions will develop that will reflect complex motivations, and competing agendas and viewpoints. Finally, informal sources of authority will provide guides and these will derive from factors such as expertise, social status and charisma.23 Across this spectrum it should be remembered that there will be ambiguities and complicated interplay.

Nohria suggests that all seven of these dimensions must be taken into account in any plan for change. The landscape is complex, interests may be competing and the sheer mechanical negotiation of change will be complicated. Nohria’s view of the purposive and layered components of an organisation illustrates how complex change efforts will always be. This model is useful in illustrating the components of organisational structures and cultures and the consequent interactive nature of the change process.

Four forms of organisational structure

The seven dimensions articulated above are compounded by other understandings of organisational structures. Four basic forms of organisational structure have been identified in the scholarship. Organisations that reflect a functional structure appear to be the most straightforward and they are also the most resistant to change. In such organisations, members are grouped according to functions and they are formed into separate units. In the functional structure, each unit is typically organised hierarchically. Organisational Structures, Sustainability and Environmental Management Systems

An organisation might also be modelled on a divisional structure in which members of the organisation are grouped according to division, with each division containing all the functional resources of the organisation. Each divisional unit is, like the functional model, typically organised hierarchically, with head office coordinating activities across divisions.

An organisation operating under a matrix structure will be a hybrid of the functional and divisional models. In such organisations, personnel are grouped according to both function and division. In this type of structure, project teams are often established and people in the organisation will report to both functional and divisional managers of equal authority.

The fourth organisational structure is best described as a network model. In this organisational structure, personnel are grouped into temporary, semi-independent, cross-functional teams that form to accomplish specific tasks. Network organisations are characterised by an informal, horizontal structure, which changes often as teams are disbanded and reformed. In such organisations, authority is often derived from informal sources, such as expertise.24

These four structural forms are capable of change but each responds differently to the imperative for change in dynamic environments. A functional structure may not cope well with change because of the need for, but lack of, effective coordination between different functional units, which we know is required to facilitate change. Similar difficulties attend a change agenda in the divisional structure. Matrix and network structures, given their inherent capacity to flex and mould themselves to circumstances should be expected to cope well with change.25 The scholarship tells us that The scholarship tells us that some forms of organisation are more able to manage, some forms of organisation are respond to and sympathetically internalise change. In cases where an organisation is seeking to respond to change or generate change itself, plainly it would be sensible to more able to manage, respond arrange the components of the organisation and modify the structure to meet the need. to and sympathetically There are lessons in this for agencies that are small and potentially more nimble but also for departments, which may well need to plan and contextualise their structures and internalise change. cultures to facilitate change.

Why are organisational structures important in facilitating sustainability? … the performance of an organisation is the product of the interaction of its parts.26

Organisational structures are important for sustainability because they are the means of driving organisational behaviour and translating an organisation’s ambitions or direction into action.27 Organisational structures provide the scaffolding for ‘the information flow, communications pathways, and coordination, which are used to deploy people’s responses to the vision, culture and objectives of the [organisation]’.28 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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This theory translates into action for sustainability enterprises in the following way:

A key purpose of structure is to focus employee attention on the mission of the unit and the organisation as a whole. Structure does this by defining the people that employees work with and report to and how those people do their work. The structure ... leads people to focus their attention on certain issues and to ignore others. It also influences each unit’s power and authority.29

Structures, vision and action In a study of the implementation of sustainability in four large US corporations, Mirvis and his colleagues provide an example of how organisational structures facilitate the shift from aspirations to action. The structures they put in place have a certain, rigorous, intensity:

GE, IBM, and Unilever each have a board-of-directors-level committee overseeing their [environmental, social and governance] performance. They also have internal steering committees of senior executives that span functions, geographies and business units and coordinative structures at the operational level to bring different departments together ... This is what it takes to ‘close the gap’ between high-minded statements of vision, mission, and values and everyday ground-level practices.30

Organisational structures also play an important role in embedding sustainability within an organisation, by supporting work to sustain organisational change in the long-term, and in facilitating the organisational cultural change that is necessary for sustainability.

When it is suggested that unsatisfactory progress on sustainability is due to the departure of senior leadership31 it is increasingly clear that this reflects a failure to embed sustainability throughout the organisation, in its structures and cultures. The case study of Parks Victoria evidences this (see page 31). The organisation’s sustainability initiatives were insufficiently advanced to resist a loss of momentum after a staffing change and it has been recognised that more needed to be done to immerse the organisation in sustainability through structural change rather than reliance upon a leader/champion. A key challenge for all organisations seeking sustainability outcomes is to ensure that responsibility for sustainability is ‘pushed downwards or inwards so that it becomes part of the organisational DNA’.32

It would appear that the vision and implementation of sustainability must be the ‘new normal’ – it must be the default position to avoid rupture or fragmentation, which has the potential to follow personnel movements. It is markedly more difficult for an organisation to lose momentum when default positions keep reinforcing the aim and vision of the organisation to meet sustainability targets.33 Organisational structures that elevate sustainability as the default position, routinely and unquestioningly, ensuring that ‘responsibility for sustainability is institutionalised beyond key individuals’34 have obviously established an ‘edge’ in sustainability practices.

As was articulated in the United Nations Global Compact CEO survey, ‘CEOs will need to harness all of the company in a more collaborative effort to ensure longevity of sustainability initiatives’.35 And this should be done in structured, not personalised, ways, engendered in the organisational culture. Organisational Structures, Sustainability and Environmental Management Systems

Organisational structures and cultural change Culture is a much debated concept. It is more than our sociality, it has to do with the ways in which we internalise actions and understandings and routinely act upon them. In organisational theory, culture might usefully be understood as ‘the way we do things here in our workplace’. Design features in a building can aid and reinforce physical changes by enforcing default positions on lights and computers being turned off, or the generation of water savings through engineering devices, but, cultural change occurs when the default positions do become the ‘new normal’ – behavioural norms – and second nature.

Organisational culture is widely regarded as one of the most important factors determining the success of sustainability efforts. A key reason why organisational change efforts fall short of their objectives ‘... is the failure to influence employee behaviour by creating a new organisational culture and structures to support it’.36

It is argued that organisational structures, as fundamental norm creation devices, can support the creation of a culture for change.

Dunphy and others suggest that organisational structures play an important role in facilitating cultural change, arguing that structural mechanisms such as groups and project teams are the ‘locus for attitude change’.37 It is suggested that the establishment of groups or ‘quality circles’ that engage employees in decision-making improves motivation and reinforces norms and that the establishment of community consultative committees can ‘have a powerful impact on attitudes’ by placing employees in ‘face-to- face situations’ with stakeholders.38

Culture change at Yarra Valley Water One Victorian organisation that has submitted itself to critical evaluation about the generation of an organisational culture of change is Yarra Valley Water. This organisation is widely recognised in Australia as a leader in corporate sustainability. Yarra Valley Water through engaging in challenging critical reflection came to an early appreciation, in its quest for sustainability, that an open and collaborative internal organisational culture was fundamental to fostering innovation, learning and the achievement of sustainability objectives.39

Yarra Valley Water openly acknowledged that it was previously characterised by unnecessarily inflexible, non-porous hierarchical structures and a relatively authoritarian leadership, and that this structure and culture generated an organisation that was characterised as ‘defensive, avoidance-oriented, oppositional and competitive’. This culture resulted in a lack of action on sustainability and the blocking of new ideas.40

Since 2001, Yarra Valley Water has initiated a number of structural initiatives to change its organisational culture. The steps the organisation has taken include the establishment of cross-functional teams, a review of reward systems to encourage preferred cultural behaviours and the introduction of ‘skip-level interviews’, which involve employees meeting with their manager’s manager to discuss ideas and initiatives on a regular basis.41

These and other initiatives have resulted in a more open, responsive, flexible and collaborative culture, which has in turn led to the development of a wide range of sustainability initiatives and projects.42

It is unusual to find the level of commitment to organisational cultural and structural analysis evidenced by Yarra Valley Water but such open and honest self-examination is clearly a focal point for the changes that have now come to typify the operations of the organisation and led to a greater immersion of sustainability practices in the operations of the corporation.

From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Sustainability requires new forms of organisational structures Poor structures will delay or mortally wound sustainability efforts.43

Some of the organisational theory suggests that traditional organisational structures can impede the successful implementation of sustainability within an organisation.

With this in mind it becomes clear that some organisations may need to adopt alternative structures or modify the rigidity of their current structures in order to achieve progress towards sustainability. They may need to move across the Dunphy phase model and develop a matrix or network structure. They may need to undertake a critical analysis such as that which was carried out by Yarra Valley Water. Public sector organisations may find this more difficult than some of the more nimble private corporations but it is not an impossible task.

It is argued that the traditional hierarchical structures characteristic of large corporations often impede sustainability because they insulate organisational systems and processes from a broad range of environmental information and ‘... seek to protect and promote the status quo’.44 Traditional structures tend to retain their focus on a small range of stakeholders – typically boards and shareholders. In narrowing their interactive range in this way, they limit or deny others access.45 This can lead to ‘internally focused governance’, which creates a real risk that an organisation screens out or ignores important information about changes to the external business environment, including customer or community expectations.46

The structure of an organisation reflects and is typically based on the existing vision, mission, strategies and objectives of the organisation. The relationship is interactive. As the vision is often itself not a fluid working understanding of changing roles in dynamic times an organisation may find itself out of step with new ideas encompassing sustainability goals.47 Sustainability is difficult to internalise in traditional organisational structures as it requires:

> the creation of new allies among the various internal and external sources of power that influence the direction of an organisation

> feedback mechanisms that allow information about the organisations’ environmental impacts to reach senior management

> fundamentally different information, decision-making and resource allocation mechanisms than provided in traditional organisations.48

Further, the creation of ‘cradle to cradle’ orientated organisations requires those at the beginning of the production chain to understand the needs of those in the middle and end. This necessitates the seamless integration of all units in decision-making, and this favours the establishment of more horizontal structures.49 Organisational Structures, Sustainability and Environmental Management Systems

Best practice self-reflection and flexibility Having considered traditional organisational structures, the dimensions and forms of organisations, and briefly reflected on why structures are important to effecting change in organisational contexts and cultures, we turn to consider ways to effect change. Notwithstanding the preceding synthesis of the scholarship around organisational structures it is clear that there is no single ‘best way’ to design organisational structures to facilitate sustainability. The most appropriate structure for an organisation will depend on a range of factors specific to that particular organisation. Doppelt, for example, points out that the most effective structures are ‘vision and strategy driven’.50 A number of broad principles provide very useful guidance that will facilitate the implementation of sustainability.

Broad principles regarding organisational structures and sustainability The literature suggests that for organisational structures to facilitate sustainability, they should reflect and incorporate and commit to the following:

> adaptability and change capacity

> alignment and integration

> knowledge and learning

> engagement and empowerment

> stakeholder collaboration.

Adaptability and change capacity – the ‘new normal’

Organisations today are faced with unrelenting demands for change, driven by a continuously changing external environment. Change is now described as the ‘new normal’ and organisations ‘... increasingly face the challenge of sustaining continuous movement ... toward a largely unknown, emergent state’.51 In the face of this level of In the face of this level of uncertainty, sustainability can be viewed as a change uncertainty, sustainability management process without a clearly defined end. The United Nations Global Compact CEO survey expresses the dilemma of sustainability well when it states ‘... [sustainability] can be viewed as a change is a dynamic, not static destination ... as companies make their journey to the new era management process without of sustainability, they are likely to find themselves constantly reorienting and adjusting toward a shifting view of the future’.52 a clearly defined end. Aspirations for sustainability will therefore require organisations to be adaptable and to be capable of responding rapidly to ‘sustainability opportunities and threats’.53 Organisations will find it necessary to actively build change capacity, which is the ability of an organisation to change not just once, but continually in response to the external stimuli.54 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Organisational theorists have highlighted the importance of organisational structures in building the capacity of an organisation to change. Buono and Kerber recently identified three basic approaches to implementing change:

1. Directed change – driven by senior management and reliant upon authority, persuasion and compliance

2. Planned change – involving adherence to a plan developed through extensive research and experience

3. Guided change – an iterative process that focuses on engaging employees in the change process and on continual learning and innovation.55

Importantly, these three approaches require different organisational structures to support change. Directed change typically requires ‘minimal infrastructure’. In contrast, guided change requires ‘... a fluid structure that allows groups to be formed and dissolved as needed, encouraging an open sharing of information knowledge and learning across departmental and work unit boundaries’.56

According to Buono and Kerber, as business complexity57 and socio-technical uncertainty58 increases, guided change becomes a more responsive and responsible approach, while the other end of the spectrum – directed change – becomes less suitable.59 As the scholarship reinforces the view that sustainability involves high socio-technical uncertainty where the solution and the problem are not fully understood,60 this suggests that guided change is likely to be the most appropriate approach for attaining sustainability outcomes.

Dunphy et al. support the view that in order to meet sustainability objectives, organisations need to focus on developing capabilities that can be used to transform the organisation to changes over time. They argue that organisational structures can play an important role in developing such capabilities by facilitating key aspects of an organisation’s performance, such as knowledge sharing, learning and innovation.61

The Victorian case studies outlined in Parts 2 and 3 of this report provide examples of how government agencies and departments have expanded their ability to adapt and change by building the capabilities of employees in relation to sustainability and facilitating learning and innovation through a variety of structural mechanisms.

Alignment and integration

Sustainability requires that organisations be understood and managed as integrated whole systems, rather than as separate components. Many scholars argue that sustainability can only be implemented effectively by taking such a systems approach.62

Viewing an organisation as an integrated whole system requires an emphasis on organisational alignment and integration. Organisational structures play an important role in aligning and integrating the activities of an organisation.63 Organisational Structures, Sustainability and Environmental Management Systems

Alignment occurs when all of the key factors that influence organisational performance – vision, leadership, structures, strategies, learning, and innovation – persistently reinforce, value and reiterate the same message. A misaligned organisation causes differing messages to be sent, and this makes the adoption of sustainability ‘almost impossible’.64

The fragmented structures and systems that permeate so many organisations today, in which authorities, responsibilities, information, communication and other key drivers are siloed in different units, undermine the development and pursuit of common goals.65 ...when organisations are not Integration occurs when information flows, decision-making and resource allocations properly integrated, ‘one-way consistently support an organisation’s objectives. Doppelt stresses that when organisations are not properly integrated, ‘one-way information flows, top-down decision- information flows, top-down making and biased resource allocations are the norm’.66 These characteristics are decision-making and biased counter-intuitive to sustainability outcomes. resource allocations are the Dunphy et al. press for understanding of the fact that integration is vital to sustainability efforts. They emphasise the importance of establishing relationships between an norm’. These characteristics organisation’s different functions (cross-functional relationships) and ‘building trust are counter-intuitive to between business units that have often been regarded as only loosely connected’.67

sustainability outcomes. A number of government departments and agencies see the wisdom in aligning and integrating their operations to achieve sustainability objectives and they are doing so through a variety of structural mechanisms.

The Department of Treasury and Finance, for example, has moved its environmental coordinator to the Planning and Executive Services Division in order to better integrate the role into the department’s planning and reporting functions (see page 61).

The Department of Primary Industries has began to integrate information flows by using its Environmental Management Tool to provide performance data for inclusion in the quarterly report to its executive committee (see page 70).

Public Record Office Victoria is achieving integration through a range of mechanisms, including the indication of its sustainability program as a priority in its corporate plan, by distributing responsibility for the implementation of the program across all levels of the organisation, and by incorporating sustainability objectives into work plans and performance reviews (see page 41).

Knowledge and learning

In a business context, it is widely recognised that knowledge is vital to maintaining competitive advantage. According to Deniz-Deniz and Zarraga-Oberty, ‘knowledge has become one of the most important assets in economic life’.68 The openness to the knowledge of others and new ideas at Yarra Valley Water, the Victorian Electoral Commission and the Public Record Office Victoria clearly advance economic and sustainability outcomes. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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An organisation’s ability to capture, share and use knowledge in order to learn and innovate is also vital to achieving sustainability objectives. In discussing ways to facilitate sustainability, Rainey comments:

Intellectual capital provides the means for creating opportunities. Having a broad scope of talent and knowledge available during the formulation of new ideas, concepts, and approaches provides rich potential for innovation and change.69

The Australian Research Institute in Education for Sustainability highlights the importance of networking, capacity building programs, and knowledge sharing in facilitating a ‘learning organisation’ and in achieving sustainability objectives. In its research work, the institute emphasises the point that many change programs fail because they focus on specific policies or actions rather than building the knowledge and capacity of employees.70

It is clear from the case studies and theoretical examination of organisational structures that structures significantly influence the ability of an organisation to capture, share and use knowledge, and thereby to build capabilities, and to learn. According to Griffiths and Petrick, for example, ‘hierarchies are killers of initiative and innovation and impede the effective utilisation of employee knowledge’.71

It has been observed that organisations that fail to make progress on sustainability have typically not implemented structural mechanisms to allow employees to expand their knowledge, test new ideas, and learn how to overcome barriers to change.72 Doppelt argues that successful organisations have typically implemented two key structural mechanisms relating to knowledge and organisational learning. These are:

> systems that continually produce and widely distribute information necessary to build employee knowledge

> monitoring and feedback mechanisms to determine progress towards sustainability goals and to provide the feedback required for continued learning.73

Griffiths and Petrick suggest that a corporation or entity will be more likely to achieve sustainability objectives if it is constituted of organisational structures that:

> enable employee knowledge to be captured and used in decision-making

> provide for information to be captured via multiple entry points into the organisation so that information diffuses across the organisation and is not confined to specialist units.74

Senge argues that it is no longer appropriate to have one person ‘doing’ the learning for the organisation. Learning must occur throughout an organisation as ‘... it’s just not possible any longer to figure [questions] out from the top, and have everyone else follow the orders of a grand strategist’.75 Additionally, and illustrating the complexity of the discussion but the universality of its outcomes, the Australian Research Institute in Education for Sustainability asserts that the sharing of knowledge within an organisation is important to prevent knowledge from being withheld and used as a source of power.76 Organisational Structures, Sustainability and Environmental Management Systems

In a recent working paper, Campbell and colleagues found that tighter monitoring and control by management over decisions by employees caused employees to experiment less in their decisions, which in turn greatly influenced their ability to learn. The study, based on the MGM-Mirage Group, found that learning was ‘almost entirely absent’ within business units that were tightly monitored and controlled by management.77

Many Victorian Government departments and agencies have established structural mechanisms to build employee capabilities and facilitate learning in their approaches to sustainability. This needs to become the new normal, the default position, if we want to effect change.

Engagement and empowerment

Organisational structures have a key influence over the ability of an organisation to engage and empower employees. These two organisational attributes are identified by many scholars and sustainability practitioners as vital to achieving sustainability objectives.

Crews exemplifies this view with the observation that ‘organisations that excel in the future will be those that understand how to engage every member of the organisation [and] gain their buy-in to new initiatives’.78 The message is one of inclusiveness and collaborations – ‘the journey to [sustainability] depends on the involvement of people across the enterprise’.79

Doppelt tells us that organisations that have achieved progress towards sustainability typically have the following characteristics:

> Employees from every function, division and level of the organisation and key stakeholders are engaged in planning and decision-making.80

> Roles, responsibilities and rules are clearly defined and employees are given the power, authority and resources to act within an agreed framework.81 ...in order to meet Many other scholars, in organisational theory and more broadly, argue that decentralising power and authority to enable ‘bottom-up’ approaches is vital to achieving progress sustainability objectives, towards sustainability. Porter, for example, suggests that in order to meet sustainability organisations should shift their objectives, organisations should shift their emphasis from ‘top-down’ design and control to a ‘bottom-up’ approach through the establishment and empowerment of small teams emphasis from ‘top-down’ of employees and stakeholders.82 She emphasises the importance of middle management design and control to a in linking top-down objectives with bottom-up outcomes and of ensuring that teams are provided with adequate decision-making powers and resources.83 ‘bottom-up’ approach through the establishment and empowerment of small teams of employees and stakeholders. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Employee empowerment at Yarra Valley Water The Australian Research Institute in Education for Sustainability’s exemplary studies of Yarra Valley Water make it clear that the empowerment of employees at Yarra Valley Water has been a major factor in facilitating innovation and the development of a range of sustainability initiatives and projects.

Over the past decade, Yarra Valley Water has initiated a number of structural initiatives to facilitate employee empowerment, including the establishment of cross-functional project teams to encourage problem-solving and ideas, and monthly meetings of employees from all levels with the managing director – five or six staff are randomly selected each month.84

These and other initiatives have resulted in a high level of collaboration within the organisation. According to the institute, ‘the downplaying of hierarchy and status combined with appreciation rather than punishment of the open expression of ideas and feelings has led to the upward flow of innovative ideas within the organisation’.85

Crucial to success is a means of spanning the multiple organisational boundaries, including functional, spatial, and temporal boundaries, which are encountered particularly within large organisations. Benn and Martin highlight the importance of boundary- spanning mechanisms such as communities of practice and ‘boundary objects’ in ensuring effective stakeholder engagement and in developing a shared awareness and meaning of sustainability across boundaries. Other examples of boundary-spanning mechanisms include sustainability ‘champions’ and liaison roles within knowledge management groups.86

Many government departments and agencies have established teams, groups or networks as a way of engaging and empowering employees to achieve sustainability objectives. The blending of theory and practice tells us that these concrete efforts are important but we also know that they must be valued and resourced, authorised and understood to have ‘clout’.

For example, the State Library of Victoria has established a staff reference group and has appointed a ‘green leaders’ team (see page 48), while Museum Victoria has established a Climate Change Committee, Zoos Victoria has established ‘Green Teams’ and the Department of Sustainability and Environment administers a whole-of- government online sustainability group.

Stakeholder collaboration – looking outward

A key theme of the literature on sustainability is the importance of organisations ‘looking outward’ by engaging and collaborating to a greater extent with stakeholders. The Australian Research Institute in Education for Sustainability argues, for example, that: ‘sustainability requires new forms of governance that facilitate engagement with a wide range of internal and external stakeholders ...’87 Organisational Structures, Sustainability and Environmental Management Systems

Stakeholder engagement and the building of partnerships encourages organisations to understand different perspectives on sustainability and respond more effectively to stakeholder needs. Stakeholder collaboration also provides a source of knowledge, ideas and feedback for innovation and learning88 and helps to generate a ‘shared vision’.89

The United Nations Global Compact CEO survey found that organisations are placing greater importance on stakeholder engagement and collaboration in order to address sustainability challenges. Seventy-eight per cent of CEOs believed that industry collaborations and multi-stakeholder partnerships are important for success.90 Importantly, consumers are increasingly driving an organisation’s approach and this level of engagement is not abating. Many CEOs identified the consumer as among the most important stakeholders influencing sustainability.91

The United Nations Global Compact CEO survey also identified that the nature of the interactions between organisations and stakeholders is undergoing change. Corporations are moving away from ‘point-to-point’ relationships to ‘layered webs of interrelationships’ or networks, which are likely to be conducted through new channels such as social media.92

However, the ways in which partnerships can or should be implemented is not well understood. Academics are increasingly studying partnerships to better understand questions such as why partnerships are forming, their benefits and limitations for different types of organisations, and how they should be structured to generate benefits for all parties and ensure optimum sustainability outcomes.93 Without promoting major The way in which organisations engage with and understand their stakeholders is central upheaval or turning our to achieving competitive advantage through innovation and a ‘more sophisticated and deeply ingrained’ form of sustainability according to Bartlett.94 Challenging understanding of how old understandings, he adds that in order to facilitate stakeholder engagement, government departments organisational hierarchies should be ‘turned upside down’. Communities and customers should, in Bartlett’s view, come top in the order of priority, followed by the front-line and agencies work, Film staff, and then by managers. In Bartlett’s view, the CEO ‘... acts merely as a facilitator Victoria and the Department for the satisfaction of the needs and wants of other, more important actors ...’95 This of Justice provide examples highly stimulating discussion of the merits of various methods of managing organisations provides a lot of food for thought. of how it is possible to The United Nations Global Compact CEO survey, taking a less challenging view, collaborate with others ultimately suggested that more open and collaborative approaches are already changing to achieve sustainability the nature of innovation within organisations as they increasingly source new ideas from objectives through various stakeholders. Innovation is therefore much more likely to involve multiple players coming together in a more dynamic fashion. Plainly, innovation is shifting ‘outside the boundaries structural mechanisms. of the firm’.96

Without promoting major upheaval or turning our understanding of how government departments and agencies work, Film Victoria and the Department of Justice provide examples of how it is possible to collaborate with others to achieve sustainability objectives through various structural mechanisms.

From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Film Victoria (see page 53) has initiated the National Green Screen Committee, which is a coalition of screen agencies that works to promote sustainability within the film industry. The committee facilitates engagement with a wide range of stakeholders internal and external to the industry, encourages the capture and sharing of knowledge and the generation of ideas and learning, and helps to inform a shared vision of sustainability.

The Department of Justice (see page 69) has extended its environmental management system to include all operational facilities, such as prisons and courts. In a good example of the benefits of external partnerships, two of the department’s prisons have partnered with a range of external organisations, including the Moreland City Council and Kangan Batman TAFE, to revegetate degraded land near Edgars Creek. The partnership also allows prisoners involved in the project to gain certification in land conservation.

Planning for action

Drawing the theory together it would appear that a number of actions can be taken in relation to organisational structures to facilitate progress towards sustainability. These actions will invoke the principles outlined above, namely adaptability and change capacity, alignment and integration, knowledge and learning, engagement and empowerment and stakeholder collaboration. Actions that can be taken include:

> establishing formal positions for sustainability with clearly defined responsibilities, such as individual roles, teams, committees, or other groups

> establishing sustainability teams comprised of employees from all business units and levels of the organisation, such as ‘cross-functional teams’

> establishing informal positions for sustainability, such as ‘sustainability’ or ‘green’ champions’, which operate across all business units

> providing teams or individuals with adequate power, authority and resources and ensure they have appropriate technical and political skills

> housing sustainability teams or individuals in locations within the organisation’s structure that bridge all business units

> establishing systems to build the knowledge and capacity of employees

> establishing systems to recognise or reward employees who drive initiatives, generate ideas, share knowledge and facilitate learning

> establishing roles to facilitate the sharing of knowledge and learning, such as ‘knowledge management’ groups or liaison roles within groups

> establishing systems to facilitate external contact with stakeholders, such as a senior manager or committee with specific responsibility for stakeholder engagement.

Many of these actions characterise sustainability efforts already in place in departments and agencies, yet we still see shortfalls in meeting aspirational targets. There is no doubt that structural change is necessary, but it would appear that it is not alone sufficient to ensure change occurs. Structures need to be used to embed sustainability; however, they are a means and not the end. As ‘hard factors’ structures need to be married to the ‘soft attributes’ of vision and culture. Both hard and soft factors are necessary for change to occur. Traditional hierarchical structures may not support sustainability efforts. Each organisation needs to respond to its challenges in a targeted way. Part 2 Agencies: Case Studies on Environmental Sustainability

Contents

Parks Victoria’s Environmental Sustainability Journey ______31

Sustainability through Staff Skills at Zoos Victoria ______35

Preservation and Conservation at Public Record Office Victoria______38

Museum Victoria Extends the Life-Cycle of its Exhibitions ______42

A Modern Approach to Sustainability at the State Library of Victoria ______47

Victorian Electoral Commission Elects to Cut Costs, Time and Environmental Waste ______50

Film Victoria Plots a More Sustainable Future ______53

Observations ______57 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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This part of the report is concerned with the exploration of the organisational structures that Victorian Government agencies deploy to effect environmental sustainability. The work here examines a range of these exercises, including agencies’ actual internal environmental management strategies, their engagement with external stakeholders and their communication efforts.

Agencies are important for many reasons, but their significance for this discussion is representative as microcosms of the larger entities, the departments. Importantly the narratives depict the multiplicity of methods of attaining change and embedding sustainable practices.

The agencies the Office of the Commissioner for Environmental Sustainability has studied highlight innovation in small spaces among, in some instances, relatively few staff numbers. Each study provides information that enriches our understanding of the ingredients for success and invites scrutiny of that which constitutes best practice in the broad reach of environmental management systems.

The agencies examined here have been randomly selected. As a general proposition their staff is small to medium size and in-house. Their constituencies are a broad external public. Each agency has a highly interactive public engagement footprint that is considerably larger than its own in-office enterprise suggests.

Not only does each agency have a large stakeholder group; each is involved in public education about matters that have either a peripheral or intimate connection with environmental issues.

The seven agencies

The agencies studied are: Parks Victoria, Zoos Victoria, Public Record Office Victoria, Museum Victoria, the State Library of Victoria, the Victorian Electoral Commission and Film Victoria.

Unifying attributes

Volunteers – not mandated The single most obvious unifying issue for the seven agencies is that each is engaged in a range of environmental management activities and, unlike the departments and Sustainability Victoria and the Environment Protection Agency, none are formally required by the Department of Treasury and Finance to report their environmental performance under Financial Reporting Direction 24C. A number of the agencies studied have, however, chosen to activate environmental management systems and they have recorded their efforts in their annual reports.

Along with departments, some agencies are required to report on energy efficiency targets and GreenPower utilisation. These include Museum Victoria and the Victorian Electoral Commission. A number have voluntarily taken up GreenPower (Zoos Victoria, the State Library of Victoria and Public Record Office Victoria) and the energy efficiency target.

ResourceSmart as a focal point Apart from the non-mandated nature of the work being undertaken, the other unifying attribute of each agency is that it has participated in the ResourceSmart Government program.

Some of these agencies were, however, innovators even at the time they commenced the ResourceSmart Government program. A number of the agencies have a long history of innovative action having started their environmental management efforts as a function of leadership, or due to the work of highly committed staff. Agencies: Case Studies on Environmental Sustainability

Organisational structural theory

Each of the seven agencies presented in this report reveal the different ways organisations commence and undertake the journey of sustainability. Extra emphasis is given to discussing the elements of organisational structure explored in Part 1 of this report so that lessons can be learnt about sustainability practices in organisations.

The Office of the Commissioner of Environmental Sustainability looked for organisational attributes, including:

> adaptability and change capacity

> an understanding of the power and importance of alignment and integration

> the ability to instigate learning behaviours across the organisation

> engagement and empowerment of a wide range of employees

> the ability to encourage collaborations and dialogue with stakeholders.

Where we find these attributes, we would expect to find the agencies doing interesting and innovative work that promotes environmental sustainability.

Methodology

Each of the environmental management stories explored has been drawn from conversations, site visits and in some cases the commentary derives from responses to a questionnaire and/or a round-table discussion.

Connections were made with the agencies:

> through meetings with senior staff associated with other seminars or consultations

> in response to invitations for discussions about sustainability and environmental management

> as a function of earlier studies that involved education for sustainability processes

> as a result of approaches made by the Office of the Commissioner for Environmental Sustainability.

Each of the agencies discussed their specific efforts to reduce their carbon footprint and as these conversations developed the associated co-benefits, economic and other, also arose. Each agency explained and explored their work beyond the office environment.

The report illustrates the breadth and diversity of the environmental sustainability work being done by agencies. Some of these case studies demonstrate high levels of achievement in energy efficiency or water use reductions, laudable outcomes in their own right. Each of these studies, however, very clearly shows organisational structures as pivotal in effecting sustainability strategies. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Parks Victoria’s Environmental Sustainability Journey udy casecas study The road to environmental sustainability is not a linear progression. Organisations may progress through phases towards sustainability but they may also find the need to re-engineer and reassess progress over time, reorganising as they go. Parks Victoria illustrates the complexity of the process, having dealt with numerous challenges, evidenced notable successes and learnt valuable lessons in its work responding to its philosophy of ‘Healthy Parks Healthy People’.

Organisational complexity and its challenges

Parks Victoria is a large organisation, with a central office in Melbourne and numerous, multi-faceted regional offices of varying sizes around Victoria. Its key obligation is to manage and protect a complex public estate, which makes up 18% of Victoria’s land area and 70% of its coastline. This asset base includes some of Victoria’s most iconic > Photovoltaic solar panels on the roof, natural and cultural values and its management deals with some difficult environmental using a hybrid vehicle and staff regularly issues – pests, plants and animals – the role and importance of environmental water using bikes is helping Parks Victoria flows, protecting land and water from a range of land uses and vast regional differences reduce its greenhouse gas emissions. and disparities in ecologically vulnerable communities. From left to right Tim Carver, Anthony Cahill, Helen Swan, Nicole Racovalis The organisation accommodates approximately 76 million visitors to 45 national parks, and Warren Murphy outside the Albert 13 marine national parks, 11 marine sanctuaries, 3 wilderness parks, 25 state parks, Park Office. 30 metropolitan parks, 60 other parks (including regional and reservoir parks), 10,412 formally registered Aboriginal cultural heritage sites and more than 2,500 non-Indigenous historic places.

The guiding philosophy of Parks Victoria emphasises the vital link between the health of people and the health of our ecosystems. The Healthy Parks Healthy People philosophy is founded on the following principles:

> Parks are integral to healthy people and a healthy environment.

> Human health depends on healthy ecosystems.

> Parks conserve healthy ecosystems.

> Contact with nature can improve human health.

> Parks contribute to economic growth and wellbeing.

> Parks contribute to cohesive, vibrant and healthy societies.

> Sustainability is a fundamentally important underlying issue for Parks Victoria.

Parks Victoria was an early adopter in implementing initiatives to reduce its impact on the environment.

The field-based role of Parks Victoria could not be more different from its in-office environmental role. It is clear the sheer complexity of the organisation’s role impacts its structure and operational culture.

Establishment of a sustainability team – staff driven initiatives harnessing staff enthusiasm and knowledge

The path to Parks Victoria becoming a more sustainable organisation began with the establishment of the Living our Values initiative in 2001. The initiative commenced as a result of considerable consultation, which determined that staff had a high level of motivation around environmental sustainability issues and were seeking greater consistency between the organisation’s values and its day-to-day activities. Agencies: Case Studies on Environmental Sustainability

In 2001, Parks Victoria established a Sustainable Practices Unit within the Corporate Strategy and Services Division. This unit was comprised of two full-time employees. It was the intention of management that the unit would ensure the organisation had the framework and staff support mechanisms to better live its environmental values and meet the Living our Values objectives.

Commitment to embedding environmental sustainability principles across the organisation was evidenced by the development of the three-year Sustainable Practices Action Plan, endorsed at the highest organisational level by the chief executive and the Parks Victoria board. This commitment from the highest tier of the organisational structure illustrates a cultural commitment to sustainability and should not be underestimated as a core component for organisational change. This plan mapped out sustainability priorities and pronounced accountabilities underscoring the delivery of the plan.

Six sustainability themes were identified:

> greenhouse gas reduction

> eco-office practices

> sustainable park management

> sustainable on-ground works

> renewable energy

> water conservation.

The work on developing this plan was very progressive and innovative, pre-dating many formal governmental requirements.

Environmental management system: collecting baseline information and establishing informal roles

As a function of the Parks Victoria initiative, program areas and associated actions were developed. This included the important but time-intensive task of determining baseline consumption data for its environmental management system such as water, electricity, gas and transport fuels. Energy consumption reduction measures were put in place as a result of audits reflecting a number of high-energy usage sites.

Parks Victoria staff were actively encouraged to develop and improve sustainability practices and behaviour through an organisation-wide Eco-Challenge campaign and Living our Values promotion. A state-wide group of Eco-Champs was created and two animations were developed – ‘Sustainable Sam’ and ‘Wasteful William’ – to reinforce the organisation’s sustainability values. These programs are good examples of methods to engage a broad range of employees and gain their buy-in to sustainability initiatives.

After three successful years, however, the Parks Victoria program lost some of its momentum. The organisation had demonstrated its ability to be adaptive and its capacity to innovate and engage staff, and it had clearly understood and implemented the important role that management can play but it appeared to rely too heavily upon a small team in a vast and complex organisation.

The loss of momentum illustrates organisational theory that tells us that it is important not to rely only on a small number of staff to do the work or to be responsible for driving sustainability initiatives. Such reliance will end in a loss of momentum and significant setback when staff changes occur. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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A change in climate, a structural change and ResourceSmart – reanimating the organisation

In 2007, Parks Victoria’s approach to sustainability was reviewed. This work was undertaken by the Corporate and Business Strategy Branch under the leadership of the general manager and the newly appointed sustainable practices coordinator. A key objective of the review was to develop a new strategy to align contemporary policy and thinking on sustainability. Sustainability in the organisation was centralised and embedded within the business operations area responsible for organisational resources and procurement.

Contemporaneously, Parks Victoria made the strategic decision to participate in Sustainability Victoria’s ResourceSmart pilot program. The new structure and program provided the organisation with the necessary information, framework and impetus to regain its environmental sustainability momentum.

We know from the organisational theory that an absence of clearly allocated responsibility is problematic in generating interest and achievements in sustainability efforts. Parks Victoria’s effort to forge an effective organisational structure to remedy this or deal with the challenges the organisation faces is replicated in other contexts. Breaking the impasse is difficult but Parks Victoria has worked to do so.

A new focus and sustaining the effort

Parks Victoria is one year into a new three-year Sustainability Strategy and Action Plan endorsed by the chief executive. This plan is clearly focused on addressing areas of past difficulty by providing a clear relationship between targets and actions, and defining actions as behavioural or structural in nature.

Parks Victoria is also renewing the emphasis on effective communication and knowledge sharing, ensuring staff are aware of the role they can play in achieving sustainability- related goals. This is occurring through the development of a new communications and marketing program.

The highlights of the re-enlivened program include: > the development of a new sustainability policy > a minimum green star rating for new passenger vehicles > commencement of the Greener Buildings Program within Parks Victoria > enhanced reporting capability > membership of the ECO-Buy Program, which assists in the development of understanding of green procurement processes and makes training programs available to staff > work to assess climate change risk to Parks Victoria’s natural, cultural and visitor assets.

These recent positive developments reflect earlier successes suggesting that processes supporting environmental sustainability practices are becoming more embedded in the organisational structure, notwithstanding some periods of hiatus. Looking back over 10 years, Parks Victoria’s Sustainable Practices Coordinator Peter Jenkins said there have been many successes. These include: > more than halving of potable water consumption and computer-related energy use > increasing awareness about water issues > reducing paper consumption > introducing LPG-powered and hybrid vehicles into the Parks Victoria fleet > a number of renewable energy installations. Agencies: Case Studies on Environmental Sustainability

Continuous learning and improvement

Valuable lessons have been learnt from the Parks Victoria’s sustainability efforts.

The work that has gone into the development of the sustainability plan for the organisation has demonstrated the power of planning across sectors and in depth. This has promoted a very clear understanding of the value of developing a business case for implementing any new strategy and action plan.

The ability to put forward a convincing business case for environmental sustainability has played an important part in recent sustainability success stores. For example, energy efficiency improvements save money, the environment and reputation. Peter Jenkins, Sustainability Coordinator Parks Victoria, 2010

Other lessons learnt from immersion in sustainability practices in the organisation include:

> that the need for strong advocacy for sustainability among senior management is at the root of every successful plan for environmental sustainability

> the importance of leadership

> the need to set targets and measure and report performance to staff

> the need to value and publicly celebrate success

> the important role of communication and knowledge sharing across levels of the organisation and within and external to sectors in the organisation

> the value of identifying co-benefits by which means broader commitment can be generated

> the danger of and need to guard against over-commitment to non-strategic efforts

> that it can take time and the clear, targeted deployment of human resources to develop and maintain environmental sustainability within an organisation.

Taking the time to communicate the messages

The process of improving Parks Victoria’s approach to environmental sustainability has been lengthy, but ultimately the effort and achievement, in light of the known historical and organisational complexities, provided valuable lessons for management, the staff and the organisation.

Parks Victoria is an organisation that illustrates the theory that structures progress and regress, that the phases of development are not always unidirectional and that some lessons, learnt the hard way, may ultimately produce positive outcomes. Organisations need to constantly re-examine process, not shrink from hearty self-criticism, learn from the mistakes of the past, and be open to hearing about them. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Sustainability through Staff Skills at Zoos Victoria udy casecas study At the Victorian Public Service Innovation Seminar on 11 March 2010, Jitinder Kohli, from the United Kingdom’s Civil Service’s Center for American Progress, presented on the attributes of a successful organisation or ‘smarter government’. With extensive experience in leading major innovation and reform initiatives at the organisational and system levels, he identified a number of ‘culture and people’ attributes in the generation of environmental sustainable organisational processes that closely align with organisational theory.

These characteristics include:

> a willingness to develop talent

> a recognition there are a multiplicity of ways to learn and that formal training is only one such way

> As part of the official launch of the Zoos > unleashing discretionary energy so people go the extra mile Victoria EMS strategy, guests were > a commitment to the principle that people matter encouraged to get their hands dirty planting trees to offset Zoos Victoria’s > omnipresence of opportunities for improvement carbon impacts and improve biodiversity at Werribee Zoo. Werribee Open Range > the public sector being able to learn from the private sector. Zoo Horticultural staff Jason Todero, Doug Zoos Victoria reflects each of these traits in the work it is doing in championing its McDougall, Glenn Collins and Daniel Borg staff generating organisational change and developing their capacity to auspice change. with Jenny Gray (Zoos Victoria CEO), Professor Kate Auty, and Zeb the Zebra. It is clear that Zoos Victoria has placed significant emphasis on building employee capacity in its approach to sustainability and recognises the importance of knowledge and learning in achieving sustainability objectives.

Proactive training and education – building capabilities and becoming adaptable

In order to improve the environmental sustainability skills of staff, Zoos Victoria has participated in the development of the Skill Up Green Project. The project won the Sports and Arts Award – Sustainability Victoria, Skills for Sustainability Award Category (2010).

Coordinated by Zoos Victoria Human Resources, the project involves an assessment of the existing level of staff skills against a competency framework that has been developed to transform Zoos Victoria into a zoo-based conservation organisation. A learning and development program is then established to bridge any gaps. The skills of Zoos Victoria staff will be central to the organisation’s ambition of becoming the world’s leading zoo- based conservation organisation within the next 20 years.

Engaging agents of change and giving them authority to act

The first step in the Skill Up Green Project was to create three Green Teams at Zoos Victoria’s three properties – Melbourne Zoo, Healesville Sanctuary and Werribee Open Range Zoo. Each of these properties has different qualities, constituencies and staff requirements and they vary in size and level of complexity. Notwithstanding this variability, the elements of an organisational structure that aids change in terms of culture and people bear similarities, which mean that the change processes are portable. Agencies: Case Studies on Environmental Sustainability

In recognition of the importance of management involvement in change processes, senior staff have endorsed members of the Green Teams to undertake a wide range of activities, including:

> implementing and auditing environmental management programs and systems

> developing and implementing efficiency (behaviour change) programs such as ‘Switch- Off’ for energy efficiency and ‘Waste-Not’ for waste recovery/recycling’, communicating sustainability practices and achievements to all staff

> responding to environmental breaches

> suggesting improvements in environmental practices.

The Green Teams have been the first to undergo the training and competency assessment but demonstrating organisational commitment, all staff will complete the process in the next five years.

This exercise in evaluation is necessary and involves an organisation in adaptive management to address shortfalls in process. A thinking and innovating organisation will factor in such evaluations as a matter of course.

Organisational commitment to a culture of environmental sustainability

Zoos Victoria clearly recognises the importance of engaging and empowering employees in order to achieve sustainability objectives. Zoos Victoria Environmental Sustainability Manager, Kiam Yoong, has advised that the focus on developing staff skills was central to achieving an organisation-wide ownership of environmental sustainability.

For a successful and meaningful environmental management strategy, it is important that all staff is engaged in the values of the organisation, its environmental goals and environmental practices developed through the strategy. The purpose of this initiative is thus to engage and provide the necessary skills for all staff to actively participate and contribute to environmentally sustainable practices and the vision of Zoos Victoria. With this training, financial and environmental gains can be easily quantified and owned by departments as business as usual, rather than owned by the Environment Department.

The recognition of the skills base and training of staff in environmentally sustainable practices and the embedding of these practices in the organisational fabric is a key and core requirement of an organisational structure working to develop its environmental sustainability understandings and operations.

The Green Teams and Skill Up Green Project are a central plank in the Zoos Victoria’s overarching culture to improve its climate change responses, resource efficiency, pollution prevention, waste management, life-cycle thinking, ecologically sustainable development and green procurement. This integrated and adaptive structure has also positioned the organisation to be nimble in its response to challenges that impact quickly, such as the recent water shortages. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Alignment and integration through ISO certification and a carbon neutrality target

Zoos Victoria’s organisational commitment to evidencing leadership in environmental sustainability is further exemplified by its additional and voluntary adoption of another method of rigorous scrutiny.

The organisation is seeking ISO 14001 certification of its Environmental Management System by 2012. The current staff performance management system where the assessment of sustainable resource management is one of seven behaviours sought and approved in key performance indicators.

The organisation’s Environmental Sustainability Strategy, which sets out the agenda to become carbon neutral by 2012 and auspices a green procurement program, furthers its visible commitment to tangible environmental outcomes. The aim is ambitious. The management and staff know this but are apparently relishing the challenge.

Setting challenging targets and supporting them with organisational structures is the sign of an intelligent, responsive, strategic plan to influence organisational performance, send a core message and lend consistent support to clearly outlined work programs. The organisational theory tells us that these characteristics will be found in a workplace successfully implementing sustainable outcomes.

Sourcing outside information and collaborating with external constituents

Zoos Victoria is positioning itself as a model for sustainability. It is seeking this accolade not only with and through its 1.7 million visitors each year, but also in its ‘industry’ with its counterparts. Zoos Victoria’s environmental sustainability manager now chairs the Environmental Sustainability Specialist Advisory Group for the Zoo and Aquarium Association.

Its website is a model of interconnections and communication exercises across the whole gamut of environmental issues. Its programs range through social and environmental ethical concerns and it has been active in mobile phone recycling and other practical exercises in reducing the carbon footprint of the community as well as the organisation.

The zoo is clearly facilitating positive engagements and collaboration about environmental issues and climate change with a wide range of stakeholders, not limited by a narrow or historical understanding of its role.

Embracing this level of connection is a fundamental tenet of an organisational structure that understands and internalises the sustainability message. It is also a characteristic of an organisation that will have success in its environmental sustainability endeavours. Agencies: Case Studies on Environmental Sustainability

Preservation and Conservation at Public Record Office Victoria casecas study Public Record Office Victoria is the archives of the State Government of Victoria. It holds records created in the mid-1830s, and protects in perpetuity and manages these records for use by the government and by the people of Victoria. As the archival authority for the state it also preserves and provides access to more than 90km of Victorian Government records and sets record-keeping standards for the government to assist it to both create and keep better records.

An organisational culture is being nurtured and an organisational structure and system has been established at Public Record Office Victoria to reduce its ecological footprint by improving the environmental performance of the Victorian Archives Centre in North Melbourne. Integrating sustainability into all aspects of the organisation for the long term, it is a good example of an adaptable organisation focused on building its capacity to change in response to opportunities and threats associated with sustainability. In its work > A culture of resource conservation has on environmental sustainability, it is demonstrating its ability to engage and empower resulted in the Victorian Archive Centre across a broad spectrum. providing its neighbour, the Lost Dogs Home with shredded office paper which Public Record Office Victoria demonstrates the characteristics of a learning organisation. is used for bedding. It creates the space for new ideas and understands the need to be open and ready to respond to external input and internal challenges. Its organisational hierarchy and its staff have illustrated the benefits of working in collaborative ways, setting themselves goals that, when met, deliver co-benefits – economic and environmental outcomes.

Public Record Office Victoria has displayed its organisational commitment to the future, not only through its core role of preserving the archives of the Victorian Government and providing primary document research opportunities, but also through its environmental management system strategy.

Two simple, effective projects that spawned a strategy

Public Record Office Victoria’s sustainability program took serious root in 2008 when two major facilities-based projects were commenced. These projects had been some time in planning and a considerable amount of study went into the planning and execution of the projects. This planning involved all levels of the organisational structure.

Climate control – environmental and economic co-benefits The first project involved a courageous and fundamental reconsideration of the use the organisation made of air conditioning to maintain fragile and valuable records. The climate management philosophy of the organisation had been entrenched over years and reflected historical and disciplinary concerns about temperature controls that had failed to take into account more recent design and technological developments.

The simple, challenging, but effective and ultimately non-contentious, environmental management strategy was to turn off the air conditioning in the storage areas and allow the previously underutilised design features of the building to maintain the required temperature conditions and preserve the archives. Being a serious departure from age-old methods of maintaining records, the innovation was very well communicated to staff, the organisational hierarchy and stakeholders. A clear co-benefit was the reduction in cost associated with maintaining records in perpetuity in circumstances where the professional responsibility of the curator is to do no harm. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Water conservation – community advantages The second project was less confronting but no less broadly canvassed. Public Record Office Victoria, during Melbourne’s water crisis, considered its roof capacity as a resource to be tapped. A major tank project was implemented and the rainwater collected from the roof of the Victorian Archives Centre is now more extensively used, mainly by the City of Melbourne, which irrigates the street trees in the area. The roof rainwater run-off is also used to service the Archive Centre’s public toilets.

The program drew upon and was supported by the enthusiasm of staff. The organisation is small enough – with a staff of approximately 75 people – to ensure that communication and knowledge sharing is good and that no interested party is excluded from collaboration.

Environmental management strategy benefits

Big projects facilitate knowledge and learning, engender a culture of innovation, encourage changes to old and settled ways of doing things, and send a powerful message that change is possible – that change can be an environmental success and it may also contribute to organisational efficiencies. These big, emblematic projects appear to have garnered support for other less flamboyant efforts and as these projects were unfolding an environmental management strategy was in the process of being developed.

The aim of the environmental management strategy was to more comprehensively address Public Record Office Victoria’s environmental impacts. A policy and action plan was released in mid-2009. The strategy documents baseline environment performance and sets out a suite of actions concerned with management and communications, education and training, waste, energy, transport, water, procurement, infrastructure, monitoring, reporting and continuous improvement.

Immediate environmental and efficiency benefits

In terms of energy savings, Public Record Office Victoria has saved almost 30% in electricity use from 2007–08 to 2009–10. The rainwater collection efforts have delivered more than 1.3 million litres of water in the year ended June 2010.

Not only have the projects delivered unequivocal environmental benefits – energy and water use reductions – but the financial saving has enabled Public Record Office Victoria to buy equipment to implement further changes in its ecological impact. Among these outcomes is the switch to 25% green power for the year 2010–11.

Beyond the utilities savings other measurable benefits have been found. The organisation through its staff commitment has reduced waste to landfill by the introduction of organic waste collection. And, there has been a marked improvement in recycling practices and awareness-raising activities.

This enabling and empowering learning environment has promoted a 33% reduction in paper use per full-time equivalent staff member between the years 2007–08 and 2009–10. In an organisation that relies quite heavily on paper as a tool of trade, this is a massive achievement.

Digital technologies The organisation has actively, and to some who intensely value the actual physical handling of the original document, counter-intuitively, embraced the new technologies involving digitisation. Public Record Office Victoria is taking a leading role in the use of digital technology for stakeholders and records researchers while at the same time Agencies: Case Studies on Environmental Sustainability

considering how it can influence thousands of public sector employees to undertake better record management by means of digital record-keeping. The benefits of this technology take-up is that management and cataloguing of documents can be effected by means of databases, and the techniques aid in the segregation of material, which ultimately will go on to further improve energy efficiencies associated with the maintenance of air conditioning regimes.

The staff at Public Record Office Victoria has advanced the digital agenda with geeks@PROV forums. This staff-led program allows Public Record Office Victoria staff to ‘experiment’ with new technology and ‘show and tell’. The geeks@PROV hold informal events on a regular basis and share with others via the Victorian Government’s intranet site, VPS Hub.

The scholarship around organisational structures suggests that staff members at all levels of an organisation will benefit from innovative programs that have been commissioned and embedded in organisational structures. Such staff will have been involved in an organisational culture of learning and communication and come to appreciate the value of innovation and the merits of even the seemingly smallest actions in promoting environmental sustainability, which in some cases will be an explicit reduction of greenhouse gas emissions.

Organisational commitment and the role of key performance indicators

The reduction in use of air conditioning was a brave move in an organisation where document preservation is core business and the risks were cautiously and strategically assessed but potentially high. The collection of rainwater was a prudent step and a commitment to help deal with a crisis affecting the entire state of Victoria at the time. Leadership from management and operational commitment from staff was critical to both of these efforts.

Responsibility for the implementation and ongoing adherence to and development of the program was distributed across the organisation. Those involved in the innovations included a project officer responsible for its coordination and all senior managers, each was required to be highly vigilant and report on progress in their area.

All staff have been actively encouraged to be involved with the program from the environmental management system to the water saving tank initiative. However, their involvement is not simply an expression of their goodwill. Each staff member is governed or guided by a requirement in work plans and performance reviews that they support sustainability activities in the organisation.

The organisational theory suggests that to inculcate these sorts of values in an organisational culture it is important to acknowledge the need for a structural response and also reward achievements. It is also important that an organisation be prepared to move staff on if their commitment is lacking. It is only through very plain and clear guidance in performance indicators and by means of a system of regular and persistent review that this can be managed and monitored. An organisation that seeks excellence or best practice needs these formal tools.

Commitment at the highest level

Public Record Office Victoria’s processes and procedures have developed a robust internal culture of innovation which impacts every layer of its work. Committees, a listening culture, an organisation credo which is open to stakeholder engagement and an understanding of the importance of communication and knowledge sharing, all contribute to this. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Public Record Office Victoria Executive Project Officer Diane Brodie believes the level of organisation-wide cooperation across physical and functional boundaries, including support from leadership, is essential to the implementation of the sustainability program. She suggests that support from and guidance by leaders in the organisation is of real importance.

Support from PROV’s director and executive team has been crucial to the program’s success. In addition to their responsibility for implementing actions, this has taken a variety of forms, including identification of the program as an organisational priority in PROV’s corporate plan, support for staff members to undertake activities in work time and direct participation in events, such as twice-yearly waste audits.

Sustainability is an ongoing process

It is clear that Public Record Office Victoria understands that sustainability is a ‘dynamic not static destination’ without a clearly defined end. Director and Keeper of Public Records Justine Heazlewood holds the view that there is always more that can be done. Of the work that she and her small team at Public Record Office Victoria are undertaking, she says:

This is not a project with a finite end. It is about integrating sustainable thinking into all aspects of our organisation for the long-term.

The notion of an environmentally sustainable organisation being a work-in-progress appears to be one of the other key features of success. We see this in the Film Victoria study and it arises as an issue in the Parks Victoria study too. Good practice that builds through either the phases of organisational change or growth will always require an intelligent and keen hierarchy that is accessible to and potentially guided by the staff. Open and interested collaboration is the leitmotif of such organisations and this feeds directly into a culture of continuous improvement, meeting goals already established and setting new ones.

Extension and communication

Other organisations are benefiting and will continue to benefit from the program which Public Record Office Victoria set in train.

Public Record Office Victoria’s partnership with the City of Melbourne to permit the use of the water collected has had a commensurate impact upon the water used from other more wasteful streams of water for that council. Public Record Office Victoria has made savings but so too has the City of Melbourne.

Beyond the water stakeholder extension, a culture of resource conservation has resulted in the Public Record Office Victoria providing the Lost Dogs’ Home with its shredded paper, which is used for bedding. This will result in savings for the Lost Dogs’ Home and may have a flow-on effect to encourage environmental sustainability efforts in that organisation.

In the best traditions of an organisation that understands sustainability practice, Public Record Office Victoria is an organisation that considers its internal operations and its obvious stakeholders, but it also reaches out to others. Public Record Office Victoria is spreading the message of environmental sustainability by presenting at Sustainability Victoria training sessions and through its online exhibition, Water Stories, talking about non-core business to an increasingly environmentally engaged and interested public. Agencies: Case Studies on Environmental Sustainability

udy Museum Victoria Extends the Life-Cycle of its Exhibitions casecas study Museum Victoria is the largest public museums organisation in Australia. It currently employs 700 staff and has more than 500 volunteers across all areas of the organisation. The museum has adopted a sustainable approach to its exhibition design as part of its organisational commitment to environmental responsibility.

The role of museums has been a changing one in the last couple of decades as practitioners and scholars consider the work of the curator and educator in respect of collection management, display, interpretation, education and potentially ‘advocacy’. The extent of the critical scholarship has been marked and the atmosphere sometimes charged. Add to that reflexive examination of the role and reach of the museum the commencement of the ‘green museum’ movement and we have potential for real organisational culture change. The growing scholarship has been concerning itself with energy and water use and overuse, indoor air quality, or, as an overarching concern, climate change concerns, climate > Life-cycle thinking and sustainable design management in-house, display lighting, housing and transportation issues. principles are implemented in some new exhibitions such as Waters of Tuvalu Overlay on this level of interest, simple, everyday issues of environmental management (pictured) and A Day in Pompeii. systems in offices – for example the use of keep cups replacing the disposables, the three bins system, changing light bulbs, or installing half-flush toilets – and you have a potentially very powerful mechanism for effecting change.

When the Office of the Commissioner for Environmental Sustainability started this research it was both bothersome and gratifying to be unable to borrow Sarah Brophy and Elizabeth Wylie’s book The green museum. A primer on environmental practice97 from the State Library of Victoria as a staff member had it out on loan. Gratifying, because it meant that our inquiries were not occurring in isolation. Bothersome, because the work is a foundation text in the new green museum movement.

Ironically, Brophy and Wylie observe that it is easier for a nature-based organisation (such as Parks Victoria) to internalise the environmental sustainability message around decisions about composting toilets and the application of wind and solar energy technology in the outdoors than it is for an organisation that deals with historical displays, such as a museum.

The work of the Office of the Commissioner for Environmental Sustainability outlined above, might suggest this observation needs to be qualified having regard to a better understanding of how organisations think rather than how they act in the field in generating environmentally sustainable strategies.

In any event, Brophy and Wylie ask some interesting questions. The obvious questions are:

> How many stakeholders does a museum have to attract to pay its electricity bill?

> How do we ‘encourage museums to reconcile old behaviours and new opportunities by showing the field that good green work is already happening?’

In the environmentalist’s argot, these questions immediately elevate environmental and economic issues as producing co-benefits and raise the question of how best organisational structures might deal with the need for rapid change. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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As an environmentally sustainable museum practitioner’s credo Brophy and Wylie suggest:

We want you to be green because it supports your mission (every institution’s not just science museums), saves money (more than the myths will lead you to believe), and can make a positive impact on the environment while encouraging staff, board, volunteers, and visitors to do the same in their lives. Green in museums is the best example of museums as community partners.

Co-benefits and developing an organisational strategy

To advance environmental management and reduce greenhouse gas emissions and costs, Museum Victoria has brought life-cycle thinking to its exhibition development process at its three museum venues: Melbourne Museum, Scienceworks and Immigration Museum.

This initiative was aligned with the organisation’s environmental sustainability strategy and involved extensive research, training of staff, the support of management, exploring a range of innovative opportunities and the development of networks with other museums and the design sector. Broadly, it works to address all stages of the impact of exhibition materials, including manufacturing, use and disposal.

Organisational culture, cross-cutting committees and change agents

Exhibition development staff at Museum Victoria initiated the lifecycle project after being encouraged to promote and implement sustainable practice. This ethic is ingrained at the museum. It is embodied in its strategic direction ‘Environmental Responsibility’ as part of the organisation’s strategic plan. It is also embedded by clear accountability measures at the executive level, these being evident in the corporate governance section of the 2009–10 annual report.

Staff efforts are further supported by other structures within the organisation. These include Museum Victoria’s Climate Change Committee, which promotes sustainable practices and behaviours. The committee was established by staff who were passionate about the environment and it focuses on enhancing environmental awareness ‘back of house’. It has held information sessions and film screenings, and promoted recycling and alternative forms of transport. Museum Victoria is clearly aware of the importance of engaging and empowering employees in achieving sustainability objectives.

More broadly, the museum’s people have been encouraged to participate in workshops and accredited ‘carbon accounting’ courses. Building employee capabilities in order to build change capacity and to position the organisation for the coming carbon economy shows real foresight. Such foresight is reflected in the work being done by Film Victoria in utilising its capacity to provide an intern for productions. Agencies: Case Studies on Environmental Sustainability

Sustainability built on rigorous foundations

An initial lifecycle workshop was held in May 2008 in conjunction with the Centre for Design at RMIT University as part of the development of the sustainable design initiative. The object of the workshop was to establish a set of principles for sustainable exhibition design.

The principles developed for the museum included:

> buying low-impact materials

> taking into consideration energy, water and raw materials used in their production

> reusing existing materials

> using less material where possible

> minimising maintenance requirements

> minimising waste such as off-cuts

> introducing low-impact lighting and multimedia hardware

> communicating the new approach to others, including suppliers and contractors.

Implementation and recognition

The sustainable design principles were then incorporated into the development of some new long-term exhibitions in the Science and Life Gallery at Melbourne Museum and in other shorter-term temporary exhibitions at the Immigration Museum and Melbourne Museum, such as Waters of Tuvalu and A Day in Pompeii.

These exhibitions contributed to Museum Victoria’s record-breaking attendance of more than 2.1 million visitors in 2009–10. The museum reached a huge, interested, curious public. The question asked by Brophy and Wylie springs to mind – how many stakeholders does it take to pay the energy bill? And, for the perspective of an environmental management system – what are the co-benefits and the organisational structures that support and advance them?

The sustainable design initiative received significant accolades. In 2010, it received the ECO-Buy Award for Excellence in Green Purchasing.

In 2009, the museum was awarded the prestigious Arts Portfolio Leadership Award, which recognises the people and programs at the state-owned agencies that have made a significant impact on Victoria’s arts culture.

Museum Victoria CEO Patrick Greene comments that sustainability is entrenched in the organisational structures and culture, and that it is this that leads to successful projects such as the sustainable design initiative receiving awards of this kind.

Environmental responsibility is something we take very seriously at Museum Victoria. We pride ourselves in being a leader in sustainable exhibition design and production. (media release, May 2010).

Both of these awards clearly lift the role of the organisation as having a real capacity to contribute to environmental outcomes. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Attaining awards for employment practice is cited in literature as having a number of attributes. It encourages individuals and the group, it generates a broad interest in innovative practices and it exemplifies best practice. Organisations that merit awards are leaders and achievers, as are their staff.

Co-benefits of environmental action

The choice of products and how they are used make a big difference to an exhibition’s impact on the environment, and design plays a vital role in managing this impact. Designers work hard to develop sustainable designs and minimise the environmental impact of exhibitions. Head of Museum Victoria Studios, Tim Rolfe. (media release, May 2010).

The sustainable exhibition design initiative has significant co-benefits for the museum in the savings that have been made in reducing waste and lessening energy use in exhibition design. Methodologies for measuring some of these reductions and the potential savings are currently being explored. One example of this is the development of a ‘Cost of Life’ tool, which calculates the operating costs and greenhouse gas emissions of exhibition technologies, such as lighting and multimedia. Museum Victoria is in the process of further refining the tool so that it can be distributed and used by other exhibiting institutions.

In a manner similar to Film Victoria, Museum Victoria has looked at its products and found ways to engender environmental practice that is both ethical and efficient. The museum has obtained co-benefits from this process, just as we would expect from studying the ‘green museum’ practitioners.

Leadership and a healthy contagion

The design initiative is part of Museum Victoria’s broader commitment to environmental sustainability. This commitment features prominently in the organisation’s core values of leadership and respect.

This focus leads to a broadening of the base of sustainability efforts, as the organisational theory tells us. The range of other sustainability initiatives at the museum include big and little projects and processes demonstrating an understanding of the need to be flexible, responsive, inclusive of ideas from within the organisation, and encouraging listening and openness. Initiatives include:

> the establishment of a fleet of five bicycles for staff travel between the museum venues

> the implementation of an office recycling program

> the introduction of energy-efficient lighting and computer hardware

> the installation of a 1.35 million litre water tank to capture rainwater from the roof of the Royal Exhibition Building to provide a constant water source for the fountains, lakes and irrigation of the Carlton Gardens and, showing foresight and strategic planning, for the soon to be restored western forecourt garden.

There are other possibilities that can be and are being explored, including environmentally friendly cleaning products, buying local, only purchasing energy star rated equipment, and environmentally sustainable catering. Agencies: Case Studies on Environmental Sustainability

Building on success and sharing knowledge

The sustainable design initiative continues to evolve as emerging technologies and techniques are tested and introduced into the exhibition development process.

West Africa: Rhythm and Spirit, which is showing at the Immigration Museum until 29 May 2011 piloted new ideas such as the introduction of sign-writing which significantly reduces the use of plastic, timber and vinyl-based graphic materials.

Museum Victoria is also sharing its research into sustainable exhibition design through conferences, seminars and publications, reflecting the importance the organisation places on knowledge sharing and ‘looking outward’.

Further demonstrating the understanding of the role of communicating ideas and successes, museum staff members have recently presented at the Sustainable Exhibition Design Workshop and contributed to two new books that will be distributed internationally:

> Exhibition design for galleries and museums: an insiders’ view (2010), Melbourne, Australia

> Green museums: sustainability, society and public engagement (2nd edition 2011), London, UK.

Texts such as these drive change, reflect a culture change in the organisational structures, encourage alignment and integration, and facilitate learning across disciplines and within the institution.

Museum Victoria is also finalising its Energy Performance Contracting project across all its sites as part of a greener government buildings program. This is a market-based approach that requires energy efficiency businesses to guarantee annual cost savings which are used to repay the capital costs over the life of the investment. This project will be the first undertaken in state-owned arts facilities.

This is in its own right a major achievement but organisational theory would articulate its other attainments as demonstrating real, tangible, practical leadership and having long- standing impacts and driving other innovations. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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A Modern Approach to Sustainability at the State Library of Victoria casecas study The State Library of Victoria has opened the page on a more sustainable future with the development of a new environmental action plan in a multi-sited building complex which tests its organisational resolve in many ways.

The State Library of Victoria is one of Melbourne’s pre-eminent cultural institutions housing the state’s largest public reference library with a collection that includes ephemera, artworks, audio and video files, digitised copies of works, music scores, books and more.

The State Library of Victoria has embarked upon a brave enterprise to generate environmentally sustainable outcomes in a heritage building complex, which presents its own challenges. The paradox is that a large part of the present complex was built at a time when we conducted ourselves with greater regard for the need to be careful about our resource consumption and where we reused and recycled more readily, without thinking. > The State Library of Victoria’s environmental Obviously the current State Library building started its life without air conditioning. Energy action plan is sensitive to its significant use did not involve the research activities of hundreds of computer-gazing university cultural heritage building. and school students. Some buildings can return to source or old technology for their ventilation needs (like the Victorian Supreme Court reopening its venting chimneys), others, like the State Library would struggle. In another context, internationally, Brophy and Wylie cite the maintenance engineer of the Cleveland Metroparks Zoo about overcoming the limitations of fit-for-purpose buildings:

We must continue to make sure we do not become complacent about buildings that were designed to be energy-efficient, but through the years have become less so. We must always keep one eye on advances in technology, and the other on the building systems.98

The second irony about this building and the organisation it houses is that if we were concerning ourselves with a different equation, the carbon footprint of the building, the State Library would be standing in good stead in terms of its embodied energy. It makes great sense to reuse old buildings but it also takes good sense to turn them into enclaves of environmental sensitivity in an energy-greedy age.

It is in this context that the State Library of Victoria, as an organisation and a structure, has embarked upon an environmental sustainability quest.

ResourceSmart at the State Library of Victoria

The State Library of Victoria ResourceSmart Strategy (Environmental Action Plan) involves a range of initiatives around energy consumption, recycling rates and contamination levels, and the use of GreenPower. The stated aspirational targets are required to be achieved by 2012. When one examines the efforts being made to reach the target and one remembers the building complex in which this ambition is located the magnitude of the effort involved is significant. Agencies: Case Studies on Environmental Sustainability

The initiatives outlined in the Environmental Action Plan are both broad and narrow, involving:

> engaging staff in determining environmental improvement priorities

> implementing new waste management practices

> installing automated air conditioning systems

> installing motion sensor lighting

> reducing lighting levels during closing hours

> introducing a carbon road mapping process.

Somewhat astonishingly the results of adopting this environmental action plan have already been a 20% reduction in energy use in the period between June 2006 and June 2010.

This sort of outcome very clearly illustrates the impact of adopting energy efficiencies and shows unequivocally the merit in doing so. Environmental outcomes are immediate and so are the co-benefits of cost reduction and staff and management education.

Organisational structure – formal and informal change agents at all levels

A clear structure of responsibility and accountability has been established to ensure the goals of the action plan can be achieved. This organisational structure provides a mechanism for monitoring, measurement and evaluation, as a necessary part of a transparent and responsive organisation.

The organisational responsibility for the effectiveness of the action plan is held by the chief executive officer and the library’s executive committee. At the same time responsibility for implementing and managing the plan is held by a steering committee, which is supported by the library’s ‘green leaders’. Each of these groups of collaborators meet regularly, examine progress, report and openly discuss difficulties. This commitment to meeting and discussion is a feature of organisations that succeed in meeting aspirational goals.

It is clear that State Library of Victoria recognises the importance of engaging employees at different levels across the organisation and of empowering employees by clearly defining roles and responsibilities.

Empowering staff to develop and share knowledge and capacity

Across the wider organisation, the staff reference group, or ‘green leaders’, have been responsible for providing input into the development of energy reduction actions. The green leaders are required to contribute energy saving ideas and provide communication, education, professional development opportunities and promote awareness of environmental sustainability issues to all staff.

The library’s chief executive officer Anne-Marie Schwirtlich has attributed a significant proportion of the success of the strategy to the involvement of staff across the library.

The ‘green leaders’ team has been a vital component of the library’s ResourceSmart strategy, providing a visible and strong link to general staff involvement in ideas’ generation, staff education and awareness and in maintaining momentum for sustainability initiatives. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The State Library of Victoria illustrates a number of attributes of an organisation cultivating the structures that provide for the effective generation of change. Broadly the organisation is showing capacity to be adaptable and change oriented; it understands the need for alignment and integration; it has elevated the importance of knowledge and learning; and, it works to promote engagement and empowerment of staff. The organisation has, to a lesser extent, taken its very diverse public or stakeholders along with it.

Financial rewards of environmental sustainability

The environmental strategy of the State Library of Victoria has brought benefits beyond those that we would class as environmental or those that arguably flow from engaging and involving staff. A particular co-benefit, as observed by the chief executive officer, is financial, but again there is more than one beneficiary:

The library is positioned to provide significant influence on its approximately 1.5 million users per year and its various government and social stakeholders. From the perspective both of good citizenship and of prudent financial management, the reduction in energy use at the library represents a significant return for the people of the state. Our achievements to date demonstrate the library’s determination to pursue further improvements in energy efficiency and other environmentally sustainable initiatives.

The fact that the State Library of Victoria has pursued environmental outcomes in its business and that it will be openly reporting on its achievements is a clear mark of its success according to the theory of organisational structures and cultures. Not only has it met theoretical sustainability criteria; it has also already delivered financial co-benefits that any shareholder of any company would welcome.

Agencies: Case Studies on Environmental Sustainability

Victorian Electoral Commission Elects to Cut Costs, Time and Environmental Waste casecas study The Victorian Electoral Commission is an independent statutory authority established under Victoria’s Electoral Act 2002. Its role is to conduct Victorian state elections, local council elections, certain statutory elections, and commercial and community elections.

An acceptance and encouragement of new ideas at the Victorian Electoral Commission has led to significant savings in cost and organisational time as well as environmentally sustainable outcomes during the conduct of the 2010 state election.

Culture of self reflection and collaboration

The Victorian Electoral Commission is an organisation that has internalised critical self-reflection in the audits it conducts about its own operations in electoral cycles. It

> The Victorian Electoral Commission seeks transparency and reports publicly on all of its operations. It does this to reflect its printed voting diagrams and instructions understanding of the need for openness with its stakeholder base, which is the whole in 19 languages plus English on all voting Victorian voting public. screens used at the 2010 State election. This eliminated the over-supply of in- For some time the Victorian Electoral Commission has been effecting environmentally language leaflets for around 1300 voting sustainable changes in its practices and these have both reflected operations in, and centres. Voting booths are constructed spread into, other jurisdictions. Examples of collaborative environmentally sustainable of recycled cardboard. strategies that deliver co-benefits of efficiency and cost savings include the use of cardboard ballot booths, computer sharing arrangements with other states and territories in the conduct of elections, careful consideration of the more environmentally sustainable use of transportation of election materials and paper reduction strategies.

The Victorian Electoral Commission is an organisation that has internalised adaptability and alignment and integration of its core business with its environmental aspirations. It values and promotes knowledge, learning and collaborations and it actively works to empower and engage the community and its staff in decisions of importance to all of us, whether those decisions are about ballot paper configuration or recycling practices.

This case study examines some of the ways in which the organisation empowers its staff to make rational and environmentally sound choices in the application of electronic technology take-up.

Empowering staff to make change

Victorian Electoral Commission officer Brett Elliot, with the support of the IT and Print and Design branches, saw an opportunity to develop a paper-saving ballot paper computer program. He approached his manager to discuss the potential for his idea and had his idea enthusiastically embraced. As a function of that openness to new ideas, the Victorian Electoral Commission has developed a range of new computer programs to fully automate the production of ballot papers used by 3.8 million Victorian voters in the last state election.

This environmentally sustainable idea came to fruition as a result of training programs to build employee capabilities and the personal enthusiasm of the Victorian Electoral Commission officer to improve systems and processes. Management was highly supportive of the development of the demonstration model, encouraging prototype development and refinements before the model was approved for full-scale roll-out and application. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The computer programs, which have been developed dynamically, fit the content of all state and municipal ballot pages to paper size. The automation has a wide range of benefits, including reducing the paper waste involved in printing ballot papers.

An assessment of the paper-saving benefits of the newly developed process has been undertaken and it was estimated that 30,000 A4 pages would be rendered unnecessary, without in any way impacting on voters or the electoral process.

Co-benefits and flow-on effects

There are a number of co-benefits from the work done in the Victorian Electoral Commission. Automation will also:

> improve the accuracy of the ballots

> increase the speed of the process of creating the necessary artwork from one and a half days to a couple of hours

> reduce staffing requirements from 30–40 staff to one person plus additional scanning staff.

Additionally, reduction of staff numbers reduces requirements for computers, travel, lighting and heating and their associated environmental costs. Reduction in the carbon footprint of an election cycle is considerable.

Recognition by the leadership team – co-benefits

Victorian Electoral Commissioner Steve Tully was pleased that his organisation had encouraged this innovation:

It is rewarding for both the Victorian Electoral Commission and the staff to see such enormous efficiencies result from a staff member’s ideas and our supportive learning and development culture. The contribution to the Victorian Electoral Commission’s sustainability objectives is tangible, and the great thing about the initiative is that it is a win for all Victorians, as well as the environment.

Again, we see the concern of a public organisation for its responsibility to deliver benefits to the Victorian public as one of the motivating forces in the work being undertaken. It is worth repeating the organisational theory, which suggests that an institution that understands this as a core objective or principle is likely to be better placed to render sustainable outcomes. The stakeholder group for this organisation is diverse, but they are nevertheless regarded as having a major interest in the organisation’s operations.

The corporate plan as a driver of environmental sustainability in organisational culture

The Victorian Electoral Commission has also formalised its organisational, management and staff commitment to environmental sustainability. It has done this by including an explicit environmental sustainability objective in its corporate plan 2007–12.

Building on that clear statement of intent, the Victorian Electoral Commission has also developed and implemented an environmental management strategy, setting key objectives and implementing action plans to achieve its goals. This has been formed around the ResourceSmart template and follows the organisation’s inclusion in the pilot phase of that program. Agencies: Case Studies on Environmental Sustainability

Aileen Duke, Policy Officer, advised us that the Victorian Electoral Commission corporate plan is driving many other environmentally sustainable activities at the Victorian Electoral Commission:

Small but potentially highly significant behaviour change practices are being undertaken such as encouraging the use of reusable coffee cups, refillable pens and default double- sided printing. The Commission’s team is also intent upon ensuring suppliers are aware of the organisation’s environmental objectives. This is done through formal and informal communication with suppliers prior to and during negotiations.

In this instance the Victorian Electoral Commission is exporting its own good environmental practice in a strategic manner.

Looking to new opportunities and collaboration with stakeholders

As an organisation with a focus on openness to novel and innovative ideas, the Victorian Electoral Commission continues to seek ways to achieve environmental sustainability and drive efficiency. These include the uptake of digital technologies in a range of situations.

An online expression-of-interest facility was developed to recruit 17,000 casual staff to work as election officials in 2010. This replaced a vast number of paper applications, phone calls and mail responses. This innovation reportedly worked very effectively. Further, an online training program has been developed for election officials, reducing travel and accommodation expenses and their associated environmental impact.

Electronic electoral roll mark-off is also being considered and was trialled in the Victorian election 2010. This will reduce the need for printed electoral rolls at voting centres. In keeping with the ethos of the organisation, this innovation will be the subject of an evaluation in the coming months. If fully implemented it will replace printed rolls at some 1,800 voting centres during state elections. The reformatting of the street lists produced for a state election has also resulted in a significant reduction in paper use. This reduces the need for printed electoral rolls at voting centres. In keeping with the ethos of the organisation, this will be the subject of an evaluation in the coming months and, fully implemented will replace printed rolls at some 1,800 voting centres during state elections. The reformatting of the street lists produced for a state election also results in a significant reduction in paper use.

The Victorian Electoral Commission regularly makes recommendations to government about other innovations that require legislative change, such as the expansion of electronic voting for specific groups of voters, which carries the potential for paperless voting in the future. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Film Victoria Plots a More Sustainable Future udy casecas study Film Victoria is a Victorian Government agency that supports and promotes the Victorian film and television industry.99 Although it could confine itself to this charter, it is doing much more, examining its own actions and reaching out to collaborate with the film industry to promote environmental sustainability. Importantly, this is an effort that is facilitative rather than directory.

The spotlight has been turned on the environmental credentials of the screen industry across Australia, thanks to an environmental audit of a long-standing television series and a new committee instigated by Film Victoria.

In-office systems and a sustainability team that works across the organisational structure

Film Victoria has been working towards the reduction of its own carbon footprint by > Professor Kate Auty on set to discuss the environmental audit process during commissioning an environmental audit of the organisation. the production of the ABC TV series As a result of the audit’s recommendations, the organisation has been reducing its Bed of Roses Series 3. environmental footprint by improving waste management and it also aims to develop From left to right Mark Ruse (Producer), Professor Kate Auty, Lindsay Lipson initiatives to reduce its energy and water consumption. (Investment and Programs Manager, A dedicated team in the organisation has driven this work, supported by the application Film Victoria), Anne Ward (Office of of the ResourceSmart Government program. the Commissioner for Environmental Sustainability) and Stephen Luby (Producer). Film Victoria, however, does considerably more than follow a potentially targeted environmental management plan for its internal consumption only. It both drives and guides environmental sustainability practices ‘beyond office’.

Beyond-office influence – instigating committee structures

The National Green Screen Committee is an environmental coalition of all Australian state and federal screen agencies. The committee, which evolved from a Film Victoria initiative, is working in cooperation with all sectors of the screen industry to promote more environmentally sustainable practices and resilient structures in a time of constrained budgets.

In a statement announcing its establishment, the committee said the greatest benefits in environmental sustainability could be achieved through a cooperative approach across Australia.

With its high profile, the screen industry is in a good position to show leadership. It made sense for all the government screen agencies to work together to improve the environmental sustainability of their businesses.100

Film Victoria is clearly an organisation that recognises the importance of collaborating and building partnerships with stakeholders in achieving sustainability objectives.

By facilitating a series of audits and developing guidelines, resources and standards, the committee members aim to reduce the environmental impact of paper waste, excessive transport and equipment use and the volume of catering waste in the industry. Agencies: Case Studies on Environmental Sustainability

In order to achieve these goals, the committee is working with industry organisations, production companies, guilds, service providers, post-production facilities, tertiary educations and government to promote environmental sustainability.

The committee is commissioning environmental audits of productions across each sector to review and highlight places where changes can be made.

The work of Film Victoria to engender an environmentally sustainable industry is a multi- sited/multi-actor networking approach.

Beyond-office influence – direct industry engagement and collaboration

Film Victoria has taken the committee message to the industry and teamed up with the equally passionate producers of ABC TV Series ‘Bed of Roses’, Stephen Luby and Mark Ruse, to audit the long running television series. This work builds on a previous audit undertaken for the feature film My Year Without Sex, instigated by producer, Robert Connolly, who is a champion of environmental sustainability within the Australian screen industry.

An initial audit of Bed of Roses Series Two was carried out by tda environmental consulting and nghenvironmental. They assessed all available data relating to resource consumption and environmental impacts from the second series of the program (produced in 2009).

This audit demonstrated there was capacity to improve the series’ environmental performance in the areas of waste, recycling and product purchases. It also concluded that more accurate reporting processes were required to capture reliable and valid data.

As a result of this process, recommendations and procedures were developed to instrumentally improve the environmental performance of the Bed of Roses Series Three, which went to air in December 2010.

Innovative use of resources – the ‘intern’

Film Victoria has always had the capacity to provide interns to certain productions and in the past this has offered opportunities to develop specialist skills aligned with the core business of the film and television industry.

For Bed of Roses Series Three, in keeping with the recommendations of the first audit and its broader interest in exploring environmental management, Film Victoria explored an innovative use of the dedicated intern position. The intern, Aida Innocente, focused on capturing the environmental data. Producer, Stephen Luby, explained the importance of this:

Having someone dedicated to collecting and monitoring data was absolutely essential. Without the extra resource, it wouldn’t have been possible to make a proper assessment of our environmental performance. So the lesson was to make sure a dedicated person was in the budget.

The need for a focused resource to implement an environmental management system is reflected in every audit report from the Office of the Commissioner for Environmental Sustainability. Staff in positions of coordinating departmental and agency environmental management operations have repeatedly stressed the need for designated personnel with allocated time and support mechanisms. Such designated personnel could be in training or already have expertise but the position needs to be solely engaged in the development of environmental work, in office and beyond office. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Commitment of the organisational management team/hierarchy to innovation and communication

Production accountant Ida Cundari explained how the commitment of the producers was critical to the establishment and support of the intern role and the wide adoption of actions to reduce environmental impact on the set.

A process likes this needs the commitment of the producers, because the set of a television series is made up of many freelance contractors and consultants. A directive from the producers is taken seriously and it certainly flows to the accounting department.

Stephen Luby identified information and messaging as important cornerstones to effect this commitment.

Everyone wants to do the right thing in this regard. But knowing what to do, what you can do, is so important. In other words, the goodwill of people for environmental action can be tapped if they know what to do: we were fortunate that our auditors were able to provide us with comprehensive advice about sustainable practices and sustainable products and services. It is also important to communicate sustainability in a way that makes sense and is relevant, which includes outlining the financial as well as environmental benefits.

Studies that explain the organisational structures that successfully underpin sustainability tell us that the need for effective communication across the organisation is critical. Film Victoria and its external partners like Stephen Luby and Mark Ruse demonstrate this.

The role of an audit – not just a compliance exercise but important for verification for legitimisation

The comparative audit of Bed of Roses Series Two and Series Three found that there is significant scope to improve environmental performance and that this can be achieved with minimal cost to production. The key to attaining this is found in more informed procurement decisions and improved accounting about resource consumption.

By Bed of Roses Series Three, careful attention to environmental management had resulted in a 16.7% decrease in greenhouse gas emissions, saving 3.52 tonnes of CO2- equivalent per episode. If the figures for other environmental indicators are included (such as batteries, printing cartridges) average consumption decreased by 24.2%, saving the production $62,966 with further cost savings identified.

Examples of specific savings included:

> reductions in air travel by almost two-thirds

> the employment of a second production runner and the use of couriers to reduce taxi journeys by over 60%

> the purchase of a new printer that reduced cartridge disposal by 41.5%, despite a significant increase in script and correspondence requirements associated with a larger production

> a 50% reduction in the use of batteries resulting from the use of rechargeables

> the replacement of polystyrene cups with readily degradable bio-ware, which, while slightly more expensive, avoided the disposal to landfill of some 16,000 cups. Agencies: Case Studies on Environmental Sustainability

A beginning built on the past and systems to share knowledge

Film Victoria CEO Sandra Sdraulig has observed that the Bed of Roses Series Two and Series Three audits are an important beginning for the screen industry.

The audit is the first step in developing a sustainability profile for television production in Australia. The process has helped define the scope and extent of the impact of the production process and importantly informs techniques to better monitor environmental impact and meet minimum reporting requirements. The Green Screen Committee intends to facilitate environmental audits of all sectors to set benchmarks for the industry.

The next step for Film Victoria and the producers will be to make available to the industry the results of the Bed of Roses audit. The Green Screen Committee intends to develop practical toolkits for the industry, and embed the knowledge it has gained.

As Robert Connolly explained:

We need to take the lead in an area that is standard practice in other industries. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Observations To the extent that these agency studies are exploratory they show that there are a number of structural features which will help to reduce an organisation’s carbon footprint and improve resource use efficiencies. Our work suggests that organisations will plainly struggle to bring about sustainability practices, reducing their carbon footprints and attaining resource use co-benefits, unless they internalise a new normal which means they are:

> supportive of learning and training

> empowering personnel

> open to new ideas generated within the organisation and amongst stakeholders and other interested outsiders

> adaptable

> receptive to change

> aware of the need for active feedback loops and persistent evaluation practice

> capable of setting new and innovative ‘wise’ default positions.

A foundational message arising out of this work and the organisational theory is that alignment and integration of intent and action and of participants and purposes is of enormous importance. Our consideration of these specific agencies clearly demonstrates the range of significant co-benefits which flow from work that delivers environmentally sustainable achievements. Part 3 Environmental Management Systems in Action

Contents

An operating ethos – transformational change – our questionnaire ______59

Transformational change – linking the environment and the corporation ______60

Transformational change and Leadership ______62

Transformational change and key performance indicators ______65

Transformational change and awards ______67

Transformational change and environmental sustainability decision-making ______70

Observations ______71

Environmental performance 2009-10 results ______72

Reporting under FRD 24C ______72

Government environmental performance outcomes 2009-10 ______73

Energy use in office buildings ______74

Waste in office buildings ______77

Paper consumption ______78

Water use in office buildings ______79

Transport ______81

Greenhouse gas emissions ______84

Procurement ______89 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The preceding parts of this report highlight the importance of organisational structures and cultures for sustainability, as they are the means for translating an organisation’s direction into action. The case studies presented provide insights into the diverse and innovative approaches to implementing environmental management in Victorian Government agencies.

The first section of this part of the report looks at the implementation of environmental management systems in Victorian Government departments, Sustainability Victoria and the Environment Protection Authority. The organisational structures and cultures of these entities is also considered to provide examples of how leadership and commitment, at an organisational level, fosters innovation which can lead to increased resource efficiency and better environmental management.

The second section presents environmental performance data for the 2009–10 period.

It is commonly suggested that the office-based environmental management system in the Victorian Government sector has reached a level of ‘maturity’, evidenced by the achievement of some savings and environmental benefits. It is arguable, though, that an office-based program addresses a relatively small part of a department’s or agency’s overall environmental footprint and that, with greater authority and top-of-management support, staff and coordinating teams could do more to enhance the profile of environmental sustainability in strategic organisational decision-making processes across the breadth of an organisation.

In all of the conversations and consultations conducted in the preparation of this report we were told that a step-change or ‘transformational’ shift is now required to reach sustainability goals and aspirations. In the case studies outlined in Part 2 of this report we have seen how this can be effected. A step-change is more likely to occur in structural contexts where planning has gone into aligning environmental sustainability outcomes with department and agency core values, and with operational, policy and leadership objectives. As we have seen in the cases studies, change comes through embedding sustainability into the very fabric of the organisation in multiple, complex but overt and comprehensible ways.

An operating ethos – transformational change – our questionnaire As part of this year’s strategic audit we used a questionnaire to seek information from departments, Sustainability Victoria and the Environment Protection Authority in relation to environmental management systems and the integration of sustainability across an organisation’s operations and its decision-making processes.

Environmental management systems support changes ‘to the way things are done around here’. A system can focus decision-making processes and inform thinking about the organisational structures necessary to deliver on organisation-wide environmental objectives and targets in reducing greenhouse gas emissions, implementing energy and water efficiency programs and making green procurement choices to embrace renewable energy alternatives and support zero waste targets. A system that develops these attributes as the ‘new normal’ will support stakeholder engagement and the integration of sustainability as core business. It will embed environmentally sustainable practices. It will operate beyond sites and across sectors or divisions and it will be essentially interactive and receptive to leadership from all the parts of an organisational structure.

The following examples illustrate the ‘transformational change’ taking place in the Victorian public sector. Environmental Management Systems in Action

Transformational change – linking the environment and the corporation

We know that the very adoption of an environmental management system signifies management commitment to improved performance and it is frequently upon this commitment that improved environmental performance is dependent. In every strategic audit report we have observed the importance of leadership for change. However, it is also clear that structural interventions are necessary and to this end corporate management of the exercise provides a significant force for change.

Alignment and misalignment The responses to the questionnaire suggest that environmental management system reporting does not necessarily or routinely inform departmental corporate planning cycles. In responding to the questionnaire, a number of departments and agencies suggested that the link between the environmental management system reporting and corporate planning cycles was confined to office-based or building-related aspects of operational activities.

The extent to which an environmental management system informs planning cycles reflects the scope, coverage and positioning of the environmental management system within the organisational structure. We have seen that sustainable outcomes will flow with fewer impediments if planning cycles are aligned and strategically situated. To give just one example of the misalignment of cycles, noting there are a number of other similar examples, the Department of Sustainability and Environment updates its Environmental Action Plan annually but the timing of this does not coordinate with the information cycle of the environmental management system. An opportunity for integration of sustainability criterion is missed, a feedback loop is fragmented and planning efforts are insulated from each other. While it may take some careful planning to remedy the situation, there are arguably positive outcomes from doing so.

The importance of alignment and integration of organisational goals and structures for sustainability is discussed in the previous sections. It is very clear that environmental sustainability will be most routinely reinforced by ensuring that all organisational processes ‘send the same message’ and that information flows, decision-making and resource allocations consistently support organisational objectives and that there are effective feedback mechanisms.

Apart from organisational cycles, it has been suggested that another significant impediment to integration occurs when environmental sustainability functions operate out of a division of the organisation with a different organisational ethos. If environmental management is lodged with a corporate services functional area such as business services, finance and facilities, it may be unaligned with organisational environmental strategy development.

Remedying misalignment – a plethora of highly targeted alternatives Different approaches have been developed to remedy this alignment issue.

In the Department of Justice and the Department of Education and Early Childhood Development, environmental management systems are driven from the Built Environment and Business Sustainability Division and Projects Division respectively. This potentially, and in practice, promotes greater engagement of the environmental management system with broader environmental programs (i.e. programs being run through prisons, courts or schools-based initiatives). In the Department of Education and Early Childhood Development, the environmental management system informs the resources and infrastructure planning cycle and by this means is part of the corporate planning cycle. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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By way of contrast, in the Department of Human Services the environmental management system is driven from the Corporate Services area. This promotes connectedness across the high resource use divisions of Regional Disability Services Housing and Community Services, Youth Justice and Bushfire Recovery Services. The environmental management work of the Department of Health is also incorporated, reflecting the history of the two organisations as having once been one, and as having some continued mutuality of interest. This blending of departmental interests and aspirations is in the best traditions of attaining triple-bottom-line objectives and associated co-benefits, as it will reduce unnecessary replication of processes.

At the Department of Sustainability and Environment, ecological sustainable design is blended with environmental management system performance considerations in planning associated with minor and capital works projects. Performance against targets is considered and reflected in specific energy, water and other sustainability-related actions. The Department of Sustainability and Environment uses its ability to manage contractual arrangements to better effect environmental outcomes and a number of environmental actions are delivered through state-wide facilities management contract arrangements. This reflects a burgeoning interest at the Department of Treasury and Finance in management of contractual arrangements for environmental outcomes and is suggestive of a cross- departmental recognition of the power dynamics of this sort of collaborative exercise.

The leadership role of central agencies in reducing misalignment During 2010, recognising the need to ensure greater alignment and integration for better environmental outcomes, the Department of Treasury and Finance moved its environmental coordinator from its Government Services Division (which provides office accommodation, vehicle fleet, ICT and procurement services) to its Planning and Executive Services group in the Corporate Strategy and Services Division. This was done to better incorporate the environmental coordination role in broader planning and reporting functions. This provides an excellent example of an organisation aligning and integrating its organisational processes to generate environmental sustainability, structuring and developing a team ethos and ensuring that feedback mechanisms are formalised for great effect.

The Department of Treasury and Finance has taken other steps to encourage transformational change for environmental sustainability and facilitate the reduction of its carbon footprint and the more efficient use of its resources. A three-year environmental improvement plan has been developed at the behest of its People and Culture Committee. Picking up on the need for high level authorisation for the attainment of environmental outcomes the Department of Treasury and Finance’s senior executive group auspiced this and the environmental improvement plan is now part of the organisation’s planning cycle. The Department of Treasury and Finance recognises that it can widen the scope of the Environmental Improvement Plan to consider broader decision-making processes beyond the office-based context and that this should underpin future planning cycles.

The Department of Premier and Cabinet has raised the profile of its environmental management system by incorporating a Strategy for Action in its 2009-12 corporate plan. This strategy will favour the reduction of the department’s carbon footprint and generally promote environmental sustainability.

Organisational theory in relation to sustainability tells us that the incorporation of formal environmental management strategies in corporate planning cycles, sends unequivocal messages about goals and strategies that sponsor and cultivate improved alignment and integration, a key factor in organisational processes promoting better environmental outcomes. Environmental Management Systems in Action

Transformational change and Leadership

Leadership defines what the future should look like, aligns people with that vision, and inspires them to make it happen despite the obstacles.101

By taking action on environmental sustainability, governments can potentially encourage and even inspire responses from industry, communities and other jurisdictions in a range of environmental settings in respect of climate change, energy efficiency, water conservation, and the sourcing and contracting of sustainable supplies and services.

A very good example of this potential to influence and demonstrate real leadership is provided by the Department of Health. The department is sponsoring environmental sustainability training and coaching in hospitals and public and community healthcare agencies in partnership with Sustainability Victoria. The department has expanded the environmental management requirements for those Victorian health services seeking accreditation through the Australian Council for Healthcare Standards. This demonstrates the role of leadership and partnerships and of maintaining learning mechanisms in and across sectors and through and over organisational structures.

The role of the collective purchasing group for Victorian public hospitals and health services, Health Purchasing Victoria, has also been augmented in relation to environmental sustainability approaches. For the first time a sustainable procurement officer has been employed. The position is being funded by a collective of organisations that recognise the wisdom of creating the role (the partners are Department of Health, the Department of Sustainability and Environment and Sustainability Victoria).102 The placement of a ‘sustainability’ officer in an organisational context is of pivotal importance in ensuring that sustainable outcomes can be reached, but it is of equal importance that the officer be provided with high-level support and that organisational structures are built around the position to maintain the role and elevate its capabilities. The organisational structure must develop a culture of support, authorisation and empowerment for the position.

Interestingly, the Department of Health demonstrated further leadership and commitment to environmental management by elevating the environmental management sections of its annual report, for the year ended June 2010, to a central place in the report and not consigning them to the appendixes as we so often see occur.

Those who responded to our questionnaire advised that the level of senior management involvement in implementing and championing environmental management systems is variable and the methods used can be, as one would expect, quite idiosyncratic or distinctive.

The Department of Human Services has established Local Environmental Action Plan templates that support regions developing and implementing their specific annual environmental management plans. Drawing the organisational hierarchy into the conversation about content, objectives and methodologies, these plans now require the specific endorsement of regional directors. This broadens the conversation about sustainability outcomes and ensures transparency but it also institutionalises feedback mechanisms and responsibility for change at a senior level. A requirement of each plan is the establishment of an environmental management network that can strategically manage implementation. Teams with clear authority should be the outcome of this structural change and senior management commitment. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Reflective of the well-understood power of authorisation at the highest organisational level the Department of Industry, Innovation and Regional Development (now known as Department of Business and Innovation) operates an Environment Steering Committee. This structural initiative highlights the ultimate level of management commitment by including the secretary and deputy secretaries. The department also holds quarterly environmental ‘Making a Difference’ workshops, which are open to all staff. It is apparent that this level of commitment to change is driven from the highest levels in the department and as such promote a ‘new normal’ in the organisational culture of the department. Once those in positions of power set default positions, it is clear such defaults become core tenets of an organisation, as they are difficult to debunk. The ‘setting of wise defaults is a powerful tool’ for change agendas.103

Picking up on the thread that high levels of management must commit to change to ensure a transition agenda is embraced the Department of Planning and Community Development’s Environment Committee was chaired in 2010 by the executive director, planning and policy. A system of checks and balances, reporting to senior management, has been put in place to ensure transparency and effective feedback mechanisms at a very senior level in the department. A process of quarterly progress reports is being used by the executive management team to monitor environmental performance. Much is made of the utility of monitoring operational change in organisational contexts where a change agenda is being driven. It is one more form of ‘measuring to manage’ but is rather more qualitative than a strict auditing exercise.

At the Department of Primary Industries, the departmental environmental management system ‘Roadmap for 2008–12’ is endorsed by the department’s executive. This Roadmap incorporates a plan for investing in environmental improvements from a range of facilities across the state. This meets another of the challenges of making an organisation commit to change at the senior level and across sectors and departments. The department is one of a few departments with a very significant decentralised office component and it can therefore be difficult to ensure a change agenda is rolled out effectively and then sustained. Organisational theory tells us that in highly devolved organisational structures a method for reporting back is essential to drive a change agenda. For the whole organisation to meet a change target there have to be mechanisms that encourage the periphery to join in. It is one matter for the centre to commit to transition. It is a completely different thing for the outsiders, those who feel external to the changes taking place, to be engaged. An organisation has to actively work to facilitate this, not relying upon individuals to do the work in the absence of authorisation or senior officer support. The Roadmap will be monitored for its effectiveness providing very clear feedback on successful innovation.

The Department of Justice is setting a very compelling example. In this department, the secretary consistently demonstrates a clear commitment to environmental sustainability. She has steadily supported the development of the organisational structures that facilitate the development of ideas and she actively supports change, sending messages through the organisation that change is welcomed and necessary to meet environmental targets. The secretary and the Standing Executive Environment Committee have, in tandem, driven change through the organisation at all levels of the environmental management system. This commitment is further promoted by funding which is made available from the secretary’s approved Environment Initiatives Fund where discretionary spending is provided for financial and environmental efficiencies. The standing committee has the authorisation of the secretary, it has longevity, it cuts across divisions and encourages a networking approach. It draws upon the skills and understanding of the organisational structure, its vulnerabilities and its strengths, and it constitutes a constant source of feedback and immersion in environmental management strategies. While it relies upon Environmental Management Systems in Action

the hierarchy of the organisation for its authority that hierarchy appears to be intently open to ideas for change, understanding that change is driven by a cohort not a single isolated individual.

Whole-of-organisation structures that facilitate the capture and sharing of information and knowledge are vital to achieving sustainability objectives. Throughout 2009–10 a Whole of Victorian Government Online Sustainability Group formed to discuss the communication of sustainability within and beyond government operations. The group continues to meet every six weeks. The group is coordinated by the Department of Sustainability and Environment and Sustainability Victoria. This network includes departments and agencies, local councils and not-for-profit organisations.

There is a clear need to consider the benefits that flow from a whole-of-government approach to environmental sustainability. The theory alerts us to the need to maintain structures across the breadth of an organisation for greatest impact in sustainability contexts.

In other domains, the utility of a whole-of-government committee has plainly driven significant change. The committee that manages the Aboriginal Justice Agreement is a case in point. There are many lessons to be learnt from this level of organisational coordination around particular issues and challenges.

‘Top-down’ and ‘bottom-up’ leadership It is important to recognise that leadership is at its best both orderly and organic, that it does not repose in a person at a pinnacle but is more likely to be reflected in many levels and at many layers of any organisation. Theoretically it is apparent that a non-traditional organisation that resists being isolated from change will actively work to obtain the ideas and input of all its innovators. As we saw in the agency case studies, this level of dialogue makes for happier and more confidently changeable organisational structures.

The contemporary focus is to conceive of leadership as being at the core of what everyone does within an organisation; it is collective and team-based more than individual-reliant. But public sector leaders today must gain commitment, not just compliance and, therefore, a collaborative style is needed, built from the bottom-up.104

Teams, groups and networks can facilitate the engagement of employees across all business units and levels of an organisation. This takes organisational craft and careful and consistent planning. For instance, where 75% of the Department of Human Services’ staff and its operations are located in outer metropolitan and regional areas, leadership is supported by the establishment of local environmental management system teams, allowing the central environmental management system team to take on a facilitation role.

Importantly, for such structures to be effective, they need to be given adequate power, authority and resources. They also need to be supported by clearly delineated frameworks within which they may operate. In every successful organisational structure where a culture for change is supported and effective, we have found leadership surrounded by teams and players from all levels of the organisation. This is a universal attribute of the successful organisation attaining environmental change. Theoretically this type of interactive organisation is described as a matrix or networked structure. We know that such structures greet and embrace change more effectively and that they respond better to stimulation and uncertainty. They are more open to ideas and innovation. A network internalises the message that leadership can come from many sources. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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We see this reflected in the use of teams, the interaction of committee structures and a genuine openness to ideas that characterises such organisational structures. Some departments appear to be more open to this understanding of interactive leadership in relation to environmental sustainability than others.

Most of the government structures studied here have established staff ‘green’ champion networks. These are groups that come together through formal and informal networks to drive environmental improvements. Enthusiastic leaders put their hand up, most often in a voluntary capacity, with no additional remuneration or status, to drive actions that reduce carbon pollution. The remarkable thing about teamwork is that it impacts cultures of organisations in many ways.

Transformational change and key performance indicators

One method that should be explored for its capacity to drive cultural and organisational adaptation and integration is the ‘key performance indicator’. Private enterprise has long understood the benefits of inserting key performance indicators into terms of employment, and they do it for a reason – it has grip or bite, it reinforces the organisational goals and culture and it provides a ready evaluation tool that is well understood and easily deployable.

For instance, Toyota has been active in generating team efforts for sustainability, for the environmental and the co-benefits it produces, for some years. Performance indicators are a significant feature of the company’s change agenda.

KPIs at Toyota Toyota Australia’s Environmental Management System, certified to the international standard ISO 14001, applies to more than just the manufacturing plant at Altona and it continues to be rolled out across both production and non-production sites throughout Australia.

At each site, environmental management system teams have been established to evaluate, feedback and maintain compliance with the international standard through annual audits. Their role includes the promotion of environmental awareness on site and ensuring continuous improvements.

Toyota has expanded beyond its core business sites and is encouraging sustainability across its dealer network through the establishment of the Toyota Environmental Dealership (TED) program, launched in May 2010. This program aims to help Toyota’s dealer network embed environmental thinking and sustainable business practices in their daily operations and encourage dealers to continuously improve their environmental performance.

The program establishes performance standards across seven social and environmental criteria, resulting in an overall ‘star’ performance rating.105

In another local context, key performance indicators have become a part of the fabric of the City of Melbourne’s sustainability commitment by means of the staff enterprise agreement, which covers 90% of those employed. Staff who attain targets receive remuneration tied to such successes. The extent of the commitment to this organisational change agenda flows all the way up to the top of the organisation. Environmental Management Systems in Action

City of Melbourne embeds sustainability measures by KPIs The City of Melbourne’s mission includes demonstrating leadership in ecological sustainability as benefits flow to all members of the community. A target of zero greenhouse gas emissions has been set. This is mirrored in the council’s and staff’s commitment to key performance indicators which incorporate sustainability targets.

On sustainability initiatives and KPIs Melbourne City Council Enterprise Agreement, 2010 states under Section 9.3.2 that:

> a series of achievable, measurable KPIs will be established

> a representative employee group will:

agree on a series of KPIs relevant to employees and council and will include: energy and waste reduction, and sustainable transport

work in conjunction and cooperation with relevant corporate sustainability programs to establish a timetable and mechanism for measuring progress against the KPIs

> satisfactory compliance with the KPIs will result in a pay increment of 0.5%.106

Demonstrating the sort of leadership that supports such initiatives, the Chief Executive Officer of the City of Melbourne Dr Kathy Alexander observes:

Our staff has been committed to Melbourne’s sustainability and has led the way for many years. I’m very proud that they have agreed to include these targets in the Enterprise Bargaining Agreement. It shows the extent of their commitment and the fact that they realise the importance of everyone, management and staff being accountable for sustainability.

In the Victorian public sector, departments and agencies have progressed formalising positions for sustainability by establishing specific roles such as environmental management system coordinators and managers. They have also incorporated environmental criteria into the work plans and key performance indicators of facilities managers, vehicle fleet management, procurement processes and the roles of information and communications technology managers.

Targeted performance indicators provide a real impetus to setting environmental priorities and, more instrumentally, they provide overt incentives for action and innovation. As we have seen in the earlier discussions, it is important that key performance indicators are spread across different business units and structural levels to ensure sustainability efforts are embedded and are able to be sustained.107

A number of specific examples of the development and use of key performance indicators can be found across government.

In 2010, the Department of Innovation, Industry and Regional Development provided leadership, made environmental commitment transparent and articulated it as ‘core business’ – the ‘new normal’ – by implementation of a suite of mandatory performance standards for all its senior managers. These performance targets include environmental management. It is envisaged that these standards will have a cascade effect and influence corporate planning cycles, which, as we have seen, can be misaligned with sustainability aspirations. Providing further support for this now very clearly articulated organisational commitment, a mandatory environmental awareness module forms part of the department’s online induction training for all new recruits. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Again in 2010, the Department of Human Services has incorporated environmental performance into position descriptions associated with the regional director’s plans. It is also intended that environmental performance will be embedded in the executive director’s performance plans in the Department of Human Services and the Department of Health.

A key driver in the Department of Primary Industries’ ongoing process of ‘site’ consolidation and underlying the implementation of its asset strategy is the reduction of the department’s ‘environmental footprint’. The department plans to formally incorporate these aspirations into a suite of organisation-wide key performance indicators.

Among the agencies, the Environment Protection Authority’s key performance monitoring tool, its ‘organisational scorecard’, picks up environmental management system indicators and targets, providing the organisation’s people with a mechanism for reflection and improvement.

Adopting a ‘similar but different’ approach, the Department of Justice incorporates environmental performance data in line with the Financial Reporting Direction 24C into its regional environmental action plans, including the prisons and courts. Standard business planning templates are set up to include environmental criteria and flow into local work plans.

In a markedly different fashion but for similar effect, Sustainability Victoria developed a tool for considering indicators for self-assessment and change when it launched its interactive ‘5StarSustainability’ self-assessment tool for government. This device allows agencies and departments to measure and benchmark their progress in environmental sustainability practice and performance. The simple ‘question and answer’ format provides information and advice that aims to provide a pathway for departments and agencies to gain sustainability leadership.108 Independent certification is a hallmark.

Each of these organisational initiatives is setting a new environmental default for its people. Some of this work is seemingly quite ordinary but it has potentially far-reaching impacts. This sort of careful, pointed, organisational restructuring will have a marked effect upon environmental sustainability outcomes. It meets all the criteria set for embedding change at a personal level across an organisational structure by involving people with their outcomes and it can be done with simplicity and clarity. It clearly telegraphs uncomplicated and uncompromised messages about the importance of the reduction of greenhouse gas emissions and the efficient use of resources, not only to the people of an organisation but also, potentially, to the wider community.

Transformational change and awards

Leaders need to reward examples of great behaviour.109

If key performance indicators present one side of the organisational code for excellence associated with performance, awards, the beyond office recognition, provide the other.

Awards provide recognition and affirmation and also generate a culture of excellence and approbation. We know from organisational theory that recognition and its attendant empowerment is important in the cultivation of environmentally sustainable outcomes. Secretaries who submit their departments to peer review of their greenhouse gas reduction practices have plainly positioned their personnel to achieve recognition, thereby reinforcing the message of sustainability, and quite naturally a triple-bottom-line ethos.

At the Department of Human Services, reward and recognition programs have been introduced. Staff may be rewarded for ‘leadership in environmental sustainability’. This award does not operate in isolation and is a component of the department’s broader ‘Making a Difference’ Award program (2010). Other departments and agencies also reward individual excellence. Environmental Management Systems in Action

Beyond rewarding individuals for their achievements it is important that there is a system of recognising organisations that promote environmental sustainability. The Department of Health, a finalist in the 2010 Banksia Awards, noting the quality of the contenders, provides an example of the sorts of projects that are being developed and showcased by departments exhibiting excellence.

Building sustainability at Health During 2009–10, the Department of Health revised its Sustainability guidelines for healthcare capital works. The guidelines set new standards for embedding sustainability into all public healthcare capital projects delivered across the state and were a 2010 Banksia Award finalist.

An allowance in the total construction cost is set aside for sustainability initiatives such as improved insulation, use of innovative technologies and the use of sustainable materials.110

Three examples of best practice are cited in the comments that follow to illustrate the level of complexity associated with the efforts being made by departments.

The first example is the Department of Human Services, which received an award in recognition of its environmental management system development and expansion, which now covers all operational facilities such as disability accommodation services, youth justice custodial services, family services, bushfire recovery services, public and social housing and community buildings as well as Department of Health office accommodation. The following two relate to the Department of Justice.

Department of Human Services – Environmental Management Association of Australia Award 2010 The Department of Human Services received an award for best environmental management system in the Government Category from the Environmental Management Association of Australia (October 2010).

This award reflected the department’s environmental management system, developed, incrementally expanded, and embedded into the corporate structure over the past years. The environmental management system has become an integral part of the department’s daily operations and its annual reporting structure.

The system is viewed as a dynamic framework that requires and contemporaneously promotes continuous environmental improvement.

Key priorities for 2010–11 include the continued expansion in non-office facilities, particularly in public housing and disability services residential facilities. This will be a real challenge for the department but it is one from which it is not shrinking.

Broadening the gamut of its environmental commitment the department is also developing a five-year strategic environmental framework, which will outline the strategies, performance measures and desired outcomes to accurately reflect its environmental commitments across its entire operations.

This program meets a number of the criteria set for an organisational structure seeking to immerse itself in environmental sustainability. It is both broad and targeted, there is a strategic plan, the organisation has grown with the system, and it is endeavouring to expand its operations into and across all its elements. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Department of Justice wins Premier’s Sustainability Award 2010 The Department of Justice was awarded the inaugural State Government Category of the Premier’s Sustainability Awards (2010) for its commitment to expanding its environmental management system to include all operational facilities, such as correctional centres and courts. One of the department’s strategic priorities is to focus on sustainable justice.

Some of the department’s key environmental innovations include:

> integrating solar technology in new and existing facilities

> harvesting rain water from water tanks for substitution of mains water use, installing shower control timers and retrofitting low-flow taps into existing facilities

> engaging regional management and staff through regional environmental action plans

> developing and implementing ecologically sustainable design guidelines in construction practices and for material selection in all new capital works and fit-outs

> establishing a standing executive environment committee.

The department’s regions play a key role in building external stakeholder relationships.

A new revegetation project within the North Western Metropolitan region, located near Edgars Creek, North Coburg illustrates the power and implications of doing so. In partnership with a local group, Friends of Edgars Creek and the Moreland City Council, two prisons, one male and one female, are propagating indigenous plants to revegetate degraded land. A secondary benefit was gained by establishing a partnership with Kangan Batman TAFE, allowing prisoners to complete Certificate II in Land Conservation.

Development of an environment and climate change framework The Department of Justice strategic priorities 2009–10 identified the development of an environmental sustainability and climate change preparedness framework. The objective of the framework is to transition the department from implementing a compliant environmental program to embedding environmental and climate change considerations into everything the department does.

To develop a gap analysis of the department’s current environmental management program, the department used Sustainability Victoria’s ‘5StarSustainability’ rating tool. As the first government department to use the tool, the Department of Justice now provides the benchmark for others.

Internal stakeholder consultation and a persistent self-referential examination of operational and strategic objectives has informed this exercise. A number of opportunities to improve the current environment program have been identified.

The department attained a four star rating with five representing sectoral leadership and one representing commitment beyond business as usual. Interestingly, external engagement appears to need the most work. Its importance for an organisation seeking sustainability is noted in the organisational theory as providing ideas and insights, and reducing isolation. Environmental Management Systems in Action

Transformational change and environmental sustainability decision-making

In the context of serious embedded planning efforts to deal with, if not actually arrest, climate change eventualities, all decisions about the efficient use of resources will need to become part of longer-term strategic planning. In departmental settings, this can mean planning for the 10-year investment strategy, and planning for other, integrated management cycles, and for periodic service and partnership contracts. The decision- making environment will become increasingly complex and its management will require better and more timely planning efforts.

Some of the decision-making taking place in various government departments and agencies provides a lead in this developing climate of uncertainty.

The Department of Primary Industries is a complex organisational structure with 70 locations across Victoria. Decision-makers utilise an environmental management tool (EMT) to provide performance data for inclusion in the departmental quarterly report, which in turn informs the executive committee. Quarterly reporting provides a level of immediacy in reporting that the annual report cannot; it permits greater flexibility in responding to change. The department is currently planning to incorporate a wider suite of key performance indicators to better plan and track organisational commitments. Reflecting its importance across the organisation, environmental sustainability is already identified as one of the key drivers in the department’s asset strategy and underpins all asset-related decision-making. It is apparent from the climate change science that regional Victoria is highly likely to suffer more frequent extreme weather events and these will have an immediate impact upon assets. No department focusing on its asset base and considering climate change impacts could fail to understand the potential difficulties, both in the present and future, a lack of strategic environmental planning will prompt.

In a similar context, in a department that has a very wide physical reach and social and cultural remit, the Department of Human Services has developed internal reporting templates to formalise sustainability actions in specific areas and track achievements and opportunities. These include:

> quarterly executive performance reviews, which compare the greenhouse gas emissions across regions and divisions

> half-yearly regional environmental performance reports in line with the Financial Reporting Direction 24C

> ‘beyond office’ energy and water performance data.

These time frames obviously make strategic planning easier. Regional environmental performance reports are reviewed annually to assist regions to develop their annual local environmental action plans (LEAP).

Sustainability Victoria has signalled plans to strengthen its environmental performance through the integrating of its environmental management system with its occupational health and safety system. This is an intelligent fit, and the amalgamation of the two systems for managing organisational structures shows considerable foresight. External parties delivering programs under contract will also come under this new regime. Sustainability Victoria undertakes regular audits and management reviews as part of its commitment to certifying its environmental management system to the international standard ISO 14001. The agency has introduced environmental management criteria into its procurement processes and its contractual arrangements, contemporaneously offering a program of environmental management support for successful tenderers. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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At the Department of Transport work is underway to review its decision-making processes and their alignment to triple-bottom-line principles. This is being effected as part of the implementation of the Transport Integration Act 2010. The department’s recent project management framework has been developed to ensure environmental sustainability considerations are the new normal of project management.

A number of departments, including the Department of Innovation, Industry and Regional Development, the Department of Justice and the Department of Planning and Community Development, utilise ‘quarterly performance reporting’ processes to inform their executive group about environmental management system performance. Such feedback mechanisms, which integrate environmental information and key decision-making processes are important to ensure sustainability becomes an ongoing and reflective process involving continual examination, learning and improvement.

The Government Services Division in the Department of Treasury and Finance is advancing a ‘business as usual’ approach to embedding sustainability. A number of recent initiatives incorporate environmental sustainability into decision criteria associated with energy and water efficiency and government office accommodation through its guidelines and workplace fit-out standards.

Observations The commentary in this part of the report has drawn upon responses to a questionnaire and it is informed by the study of organisational theory. It is apparent that the conclusions we have formed about successful environmental sustainability practice in the agency studies (Part 2) are equally applicable in respect of departmental practice.

A large department, just like a large private corporation or a small agency, will benefit from internalising environmental sustainability processes and practices as the ‘new normal’. The setting of wise, achievable but stretching defaults and feedback loops and the normalisation of evaluation exercises will all assist in this regard.

Departments which are succeeding in developing a ‘new sustainable normal’:

> are transparently open to ideas

> have formed and continue to actively promote powerful structures and processes which support that openness

> value, train and empower all their people in developing those ideas

> understand the importance of authorising and celebrating teams, committees and teamwork

> know the importance of broadening the range of those involved in change processes

> know that narrow reliance upon a small cadre of committed individuals can be oppressive and counter productive and may not be enough to institute new processes speedily and effectively.

The best examples of environmentally sustainable organisational practice, evidencing co-benefits of reductions of greenhouse gas emissions and clever resource use, have been found in departments which understand the need to align and integrate their goals and actions at the highest levels of the organisational structure. Leaders shine in environmentally sustainable organisational practice. Environmental Management Systems in Action

Environmental performance 2009-10 results Since 2003, it has been mandatory for all Victorian Government departments, Sustainability Victoria and the Environment Protection Authority to implement environmental management systems.

An environmental management system itself does not set performance standards, but is a tool to reach goals through statements about policy and regulatory compliance and continual improvement, adaptability and change. Internationally it is recognised that reducing greenhouse gas emissions and achieving sustainable development depends on integrating environment into management strategies at the corporate, project and site levels.111

The environmental management system implemented by the departments and agencies in Victoria had an office-based focus, but also included the study of greenhouse gas emissions from transport. It was modelled on the ISO 14001 standard.112

The departments, Sustainability Victoria and the Environment Protection Authority are also required to report annually on their environmental performance in compliance with the Department of Treasury and Finance’s Financial Reporting Direction 24C.113 114 115

Reporting under FRD 24C

The Financial Reporting Direction 24C sets minimum reporting requirements and includes the following:

> energy use – stationary energy: building consumption such as electricity (including green power), natural gas, LPG, heating oil, diesel and solid fuel

> waste production – includes waste to landfill, waste sent for recycling and composted waste

> paper use – paper used for printing, photocopying and similar processes

> water consumption – includes domestic water use, rainwater and reused water consumption

> transportation – vehicle fleet energy use, air travel and staff commuting

> greenhouse gas emissions – associated with building energy use, vehicle fleet use, air travel and waste production (any offsets purchased are also reported)

> procurement – discuss whether and how procurement activities are environmentally responsible.

This reporting direction allows for departments and agencies to report on a broader set of criteria and for other public sector agencies to adopt a reporting process. Departments and agencies may include a statement on intentions and principles in relation to environmental performance and the use of any relevant Global Reporting Initiative (GRI) indicators.116

Consideration is being given to aligning the reporting direction with international standards. Sustainability reporting frameworks, such as the GRI indicators, can arguably improve reporting relevance and reliability, having a focus on engagement and processes that take a corporate or organisation-wide perspective. (see Appendix 2) for list of

GRI reporting organisations. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Government environmental performance outcomes 2009-10

Defining the requirements for measuring and reporting on progress at departmental and whole-of-government levels allows progress to be compared over time and between agencies, provides accountability and can motivate all levels of staff to improve their organisation’s performance. We know from the organisational theory that evaluations and feedback provide a significant opportunity for this.

The environmental performance analysis presented in this section is based on annual reports of Victorian Government departments, the Environment Protection Authority and Sustainability Victoria.

The following table provides a rolling five-year average of energy, water, waste and paper use, and of vehicle emissions from 2005–06 to 2009–10. Juxtaposed against that rolling average is the average figures for 2009–10 for the departments, the Environment Protection Authority and Sustainability Victoria.

FRD24C indicator for office- Rolling 5 year 2009-10 based activities average117 average

Energy use per floor area 410.4 398 (megajoules per m2)

Water use per full-time equivalent 10,398 10,283 (litres/FTE)

Waste produced per full-time 91.5 98.8 equivalent (kg/FTE)

Paper use per full-time equivalent 15.1 14.3 (reams/FTE)

Vehicle emissions per 1,000km 0.26 0.24

travelled (tonnes CO2/1,000)

Note: VicRoads for the fourth year has reported against the Financial Reporting Direction 24C on a voluntary basis and is included in the presentations in this section of the report but is not included in whole-of-government trend data. Environmental Management Systems in Action

Data verification In reviewing the environmental performance data, it is recognised that environmental performance reporting in the Victorian public sector continues to develop. As a result inconsistencies will continue to appear in the data collection and monitoring from one year to the next.

To date, the measuring and management of environmental performance by departments and agencies has developed largely using an array of independent databases relying extensively on manual data entry. The Department of Primary Industries is an exception and has made good progress in streamlining its data collection processes, including importing data directly from electronic spreadsheets provided by utility companies, as part of its environmental management tool.

Independent verification and assurance processes should be in place to improve the reliability of reporting. The reasons provided for variations in the data in some instances are not sufficient to explain significant increases or decreases. The Public Accounts and Estimates Committee has also noted this in its assessment of 2008–09 annual reports.118

The application of an electronic data management system, which is currently being developed by the Department of Sustainability and Environment, and the development of data management standards for the exchange of environmental data should help overcome some of these concerns.

Compliance During 2009–10 there was an increase in the reporting of the percentage of sites and the percentage of staff represented in the data sets. In particular, improvements in reporting were made by the Department of Primary Industries and the Department of Sustainability and Environment for water and energy use.

Compliance reporting in line with the Financial Reporting Direction 24C requires departments and agencies to present comparative data for at least one year. In 2009–10, all departments and agencies improved their reporting of trend data. Trend data was not always previously provided in relation to air travel kilometres and associated greenhouse gas emissions.

Departments and agencies are also required to report on at least one target for each environmental aspect. The majority of departments, Sustainability Victoria and the Environment Protection Authority have outlined targets for building energy, waste, water and paper.

Energy use in office buildings

Building energy is the largest single source of greenhouse gas emissions relating to office-based activities across government departments and agencies.

Energy Efficiency In the 2009–10 period, departments and agencies were required to work towards reducing their energy consumption by 20% by 2010–11 based on 2000 levels.

Progress against this target is being overseen by the Department of Sustainability and Environment and Sustainability Victoria is using the Commonwealth Government’s Online System for Comprehensive Activity Reporting for measuring purposes. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Office building energy performance Comparable reported data shows a 3% reduction in 2009–10 from 2008–09 in energy use per square metre of office space and a 3% reduction in associated greenhouse gas emissions.119

The average energy use per square metre was 398 mega joules for 2009–10.120

The following graph highlights the percentage change between 2009–10 from 2008–09 in the amount of energy use per square metre.

Figure 1. Percentage change in office energy (megajoules) used per unit of office space











            

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Explanatory comments: • Reported energy use covers an average of 95% of department and agency office-based sites. • Department of Primary Industries data includes non-office-based energy consumption such as laboratories and research facilities, which are high-energy users. These cannot be easily separated from the office data. • Department of Sustainability and Environment reported energy is for all its buildings, including offices, depots and office–depot combined facilities. • VicRoads: The 2009–10 figure of 1,035 MJ/m2 is higher than the year before because it only included the four main offices (which are less efficient), whereas the figure of 770 MJ/m2 for the 2008–09 period included all VicRoads offices. VicRoads advises, if comparing energy use relating to the four main offices only, there was about a 2% improvement. • Department of Education and Early Childhood and Development excluded from graph – significant variation in the reported figures between 2009–10 on 2008–09. The department has advised that improved data verification and assurance processes are in place for 2010–11. • Department of Health excluded from graph, formed in August 2009, with no comparative data reported.

Data The collection and reporting of energy data can vary between departments and agencies, making direct comparisons difficult. These variables include:

> whether only building tenant light and power is reported (i.e. the component of electricity organisations control and pay for directly)

> the organisation’s share of base building electricity load is included

> new sites have been picked up as part of improving data representation.

One example of the continued availability of straightforward ways to reduce energy consumption can be found in the extraordinary performance of the Geelong Law Courts. Environmental Management Systems in Action

Geelong Law Courts ‘Green-maker’ initiatives, Magistrates Court of Victoria As part of a Department of Justice ‘Green-maker’ initiative a series of remediation works has been undertaken at the Geelong Law Courts. This has led not only to substantial environmental benefits but has achieved real cost savings to the running of the court.

The initial idea of installing rainwater harvesting tanks servicing the toilet system was raised by the staff at the Geelong Court as a direct function of their concern about the diabolical water situation in the region. (Barwon Water and the City of Greater Geelong have been very active in generating interest in this challenge for the region). This proposal was fully supported by the senior registrar and was funded by the court. The water tanks installed hold 4,400 litres and provide approximately 4,889 flushes when full. The court is also looking into the possibility of offering water from the tanks to local sporting groups and to local community tree planting groups.

Taking advantage of the secretary’s Department of Justice Environmental Initiatives Fund, Geelong Court also implemented an energy and water audit. This prompted upgrades to the building automation and lighting system and the installation of energy-efficient and sensor lighting throughout the building.

As a result of these initiatives, Geelong Court has reduced its power and utilities bills by 26%.

The Geelong Court was recognised in the Victorian Premier’s Sustainability Awards for its tangible achievements.

Other courts in the region are now being audited and assessed for similar treatment.

The Magistrates’ Court of Victoria has recently commenced a new project ‘The Sustainable Budget Strategy’ focusing on the co-benefits of environmentally sustainable courts to help achieve sustainable operating budgets.

GreenPower The graph below presents office-based electricity use and indicates the amount of electricity sourced as GreenPower, as reported in 2009–10 annual reports.

Figure 2. Department and agency office-based electricity usage, including GreenPower 2009-10

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Explanatory comments: • The Department of Primary Industries includes significant non-office-based data such as laboratories, glasshouses, research facilities, farming and plant breeding that cannot be readily separated from its other data (the department accounts for around 1.3% of the total energy use of government departments and agencies).121 From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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The average amount of GreenPower purchased for office-based electricity by departments, the Environment Protection Authority and Sustainability Victoria was 34% in 2009–10 and ranged from 15% to 100%. Three departments and the two agencies met the 25% target for GreenPower purchases for office buildings that applied in the reporting period: the Department of Planning and Community Development (34%), the Department of Primary Industries (25%), the Department of Sustainability and Environment (33%), the Environment Protection Authority (100%) and Sustainability Victoria (100%).

Avoiding costs For Western Australia, where targets are also in place, the state Auditor-General reported in 2010 that setting and achieving energy use targets can result in the avoidance of additional energy costs and achieve significant reductions in greenhouse gas emissions.

In that state, not all government agencies achieved their energy targets. The Auditor- General noted,

... achieving the target, then maintaining consumption at those levels, would have saved government $50 million in gross energy costs over the past seven years and reduced greenhouse gas emissions by nearly 350,000 tonnes ... Western Australian Auditor-General, June 2010, Energy Smart Government

Waste in office buildings

Waste in many of the departments and agency offices is separated into different waste streams to maximise composting and recycling of materials. The ‘waste produced’ data covers waste to landfill, waste (including paper) sent for recycling and composted waste.

Comparable reported data shows an increase of 8% in total waste produced per full-time equivalent staff in 2009–10 compared to 2008–09. The associated greenhouse gas emissions associated with the waste to landfill was a 16% increase.

The increase is mainly found in Department of Human Services data, where waste audits were carried out at strategically selected sites that required waste management improvements, making direct comparison between years difficult.

The average office waste per full-time equivalent staff is 98.8kg per annum for 2009–10.122

Waste comparison indicates a 4% decrease in the amount of waste being recycled and composted, from 87% to 83% for 2009–10 when compared 2008–09. However, since the inception of systems to divert office-based waste from landfill, departments and agencies have reported recycling rates of 80% plus over the past few years.

Environmental Management Systems in Action

Figure 3. Percentage change in waste (kg) produced per FTE

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Explanatory comments: • Department of Premier and Cabinet quarterly waste audits were undertaken under a new cleaning contract. These audits employed a different methodology from those undertaken in 2008–09. • Department of Human Services waste audits in 2009–10 were carried out at different sites than in 2008–09, making direct comparison between years difficult. • Department of Transport waste audit for 2009–10 was the first occasion that a complete five-day audit of all departmental staff and sites has been conducted. • The Department of Planning and Community Development is reviewing the auditing methodology. In 2009–10 waste audits were conducted at three central business district sites and five regional locations. • VicRoads data was limited to four major offices. • Department of Health excluded – no available data for 2008-09.

The majority of Victorian Government departments and agencies calculated office-based waste production by extrapolating the results of a number of waste audits undertaken in 2009–10. In some cases, annualised data relates only to sites for which waste audits were undertaken.

Paper consumption

Paper purchased data continues to be regarded as reliable, with suppliers providing consistent data to departments and agencies.123

Departments and agencies paper use per full-time equivalent staff reduced by 3% in 2009–10 compared to 2008–09. 124

The average amount of paper used per full-time equivalent staff in 2009–10 was 14.3 reams of paper or 28.6 sheets per day.

The total office paper use of 395,682 reams of paper for 2009–10 or 198 million sheets represents a 1% decrease compared with 2008–09.

Paper use reported under the Financial Reporting Direction 24C does not require environmental or financial accounting of impacts related to toner usage or external printing, such as production of departmental publications. To reduce the greenhouse gas emissions associated with the production of a paper document and to reduce the costs associated with production, some departments and agencies now print limited copies of their annual reports and refer people to their websites to access the electronic version of their report. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Figure 4. Percentage change in reams of A4 equivalent paper used per FTE



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Explanatory comments: • Paper consumption data is generally measured by using paper purchased data from suppliers. • The Department of Treasury and Finance significantly reduced its paper use in 2009–10 to 16 reams per full-time equivalent staff. Actions taken during the year include reducing the number of printers, replacing them with more efficient multi-function devices and establishing a system that promotes electronic document reviews to reduce printing. • Department of Health excluded – no available data for 2008–09.

Water use in office buildings

Comparable reported water use shows a decrease of 5% per full-time equivalent staff in 2009–10 compared to 2008–09.125

The average water use per full-time equivalent staff is 10,283 litres per annum or 41 litres per day for 2009–10.126

The following graph highlights the percentage change between 2009–10 and 2008–09 in the amount of water use per full-time equivalent staff.

Figure 5. Percentage change in metered water (litres) consumed in office per FTE

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Explanatory comments: • The Department of Sustainability and Environment has significantly increased the number of sites reported in 2009–10 covering 73% full-time equivalent staff and most sites, compared to 49% in 2008–09. While reported water use has increased across the department the inclusion for the first time of additional large sites is encouraged. For example this year was the first in which the water consumption (at 570 Bourke Street, Melbourne, which houses the Office of the Commissioner for Environmental Sustainability and Land Victoria) was recorded. The department has indicated that these additional sites are relatively inefficient in water use, 570 Bourke Street for instance does not have dual-flush toilets throughout, and yet they accommodate large numbers of staff. >continued Environmental Management Systems in Action

• The Department of Planning and Community Development has indicated that additional sites have been included for 2009–10 and data methodology improved. Data includes a ‘one-off’ flooding event at 1 Spring Street in 2009–10. • Department of Primary Industries data includes leaks detected at two regional sites. • Sustainability Victoria water use for 2009–10 includes base building data. The variation compared to 2008–09, includes potable water use when the black water treatment plant was down in 2009–10. • Reported water use covers an average of 96 per cent of departments and agencies office-based sites. • The Department of Education and Early Childhood Development is excluded from the graph – significant variation in the reported figures between 2009–10 and 2008–09. The department has advised improved data verification and assurance processes are in place for 2010–11. The significant variation would skew the representation of the data if included. • VicRoads did not report water data for 2009–10 due to errors in water metering to be rectified. • Department of Health excluded – no available data for 2008–09. The collection and reporting of water data can vary between departments and agencies making direct comparisons difficult. These include whether reported data includes base building (central services) water usage or tenancy only water use and whether new sites have been picked up as part of improving data representation and expanding environmental management across the organisation.

Transport

Vehicle environmental performance Reported data shows a 3% increase in the vehicle kilometres travelled in 2009–10, at 103 million kilometres for the year. However, overall greenhouse gas emissions decreased

slightly, totalling 24,921 tonnes of carbon dioxide equivalent (CO2-equivalent).

The tonnes of CO2-equivalent per 1,000 km travelled provides a useful measure about

the environmental efficiency of the vehicle fleet. Reported tonnes of CO2-equivalent per 1,000 kilometres travelled decreased by 3% in 2009–10 compared to 2008–09.

127 The vehicle fleet average is 0.24 tonnes of CO2-equivalent per 1,000 km for 2009–10.

Figure 6. Percentage change in greenhouse gas emissions (tonnes CO2-e) from vehicle fleet per 1,000 km

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Explanatory comments: • Vehicle fleet data relates to passenger vehicles, which include operational vehicles, executive and judiciary vehicles. All data sets do not include executive vehicles. • Department of Health excluded – no available data for 2008–09.

From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Victorian Government vehicle fleet mix Not all vehicles emit the same type or combination of greenhouse gases. The principal greenhouse gas associated with vehicle use is CO2, but vehicles also produce the greenhouse gases nitrous oxide and methane. A vehicle’s level of CO2 emissions is linked to the amount of fuel consumed and the type of fuel used.128

Around 85% of operational passenger vehicles are now hybrid, four cylinder or liquid petroleum gas vehicles, compared to only 15% of executive vehicles.129

Figure 7. Size and composition of the operational passenger vehicle fleet, 2004-05 to 2009-10 (

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Executive vehicles make up around 25% of the Victorian Government passenger vehicle fleet. The composition of the executive fleet is weighted towards large petrol vehicles, and therefore makes a proportionally significantly greater contribution to vehicle-related fuel use and greenhouse gas emissions.

The Department of Justice accounts for about 40% of the Victorian Government’s executive officer vehicle fleet but this specifically includes judiciary vehicles.130 Judiciary vehicles make up 81% of the Department of Justice fleet (relates to judges, magistrates and Victorian Civil and Administrative Tribunal members). The department does not control judicial vehicle allocations, this responsibility rests with the judiciary.

Figure 8. Size and composition of the executive vehicle fleet, 2004-05 to 2009-10

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As at 30 June 2010, the vehicle fleet contained 997 low-emission hybrid vehicles. Hybrid vehicles made up:

> 33% of the operational vehicle fleet

> 9% of the executive vehicle fleet.

Increasing the fuel efficiency of the government’s vehicles will also reduce emissions in the wider community as most government vehicles enter the second-hand private market through vehicle fleet sales.

Opportunities for further reductions include the type of vehicle in the government’s executive and fit-for-purpose/commercial vehicle fleets, measures to change the utilisation of vehicle types and driver behaviour training and the take-up of alternatives to travel.131 This can include the use of technological solutions.

Air travel environmental performance Air travel information is obtained from the whole-of-government travel services contract.

Reported air travel kilometres for the departments, the Environment Protection Authority and Sustainability Victoria is 32 million kilometres for 2009–10. This represents an increase of 3% compared to 2008–09.

The associated greenhouse gas emissions relating to 2009–10 air travel is 12,089 tonnes of CO2-equivalent. Representative comparisons at the whole-of-government level for this indicator are difficult between 2009–10 and 2008–09 due to the Department of Justice and Department of Human Services providing more complete data sets for 2009–10 than 2008–09.132

Of note, however, is that the Department of Premier and Cabinet and the Department of Treasury reported having more than halved air travel kilometres in 2009–10 and thus significantly reduced air travel associated tonnes of CO2-equivalent.

Departments and agencies need to review and ensure reliable systems are in place to collect air travel data and that consistent methodologies are adopted for calculating greenhouse gas emissions. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Calculation of air travel emissions – Environment Protection Authority The Environment Protection Authority (EPA) is leading the way in measuring and reporting Scope 3 emissions.133 Air travel and paper factors are accepted emission factors under the National Carbon Offset Standard (NCOS) Carbon Neutral program.

Each year the Environment Protection Authority reviews its emission factors and methodology to ensure the most recent and conservative measures are applied to its environmental management system and carbon neutrality calculations. The Environment Protection Authority works in partnership with carbon management and life-cycle experts from RMIT’s Centre for Design and Sydney’s University of Technology to develop and review Scope 3 emissions factors and methodology. In 2010, the Environment Protection Authority updated its air travel methodology.

The calculation of emissions from air travel is complex and continually evolving, particularly as it relates to the estimates and use of the Radiative Forcing Index (RFI). The

RFI considers the impact of non-CO2-e aviation emissions on the atmosphere (e.g. NOx compounds, ozone, water, contrails and particles) and cirrus cloud formation. A common carbon accounting approach is to use an RFI of 1.9, which only accounts for non-CO2-e. The Environment Protection Authority in the past has used a RFI of 2.7, which also accounted for cirrus cloud. However, based on research by the Intergovernmental Panel on Climate Change the level of uncertainty for the impact of cirrus cloud could be greater than previously thought. The high-end estimate of cirrus cloud impact is 3.1, which when added to the impact of non-CO2-e (1.9) is a total RFI of 5.0. The Environment Protection Authority has therefore chosen to adopt the conservative RFI of 5.0, to ensure that it is not underestimating emissions associated with staff air travel.

‘Each year, staff working on EPA’s Carbon Neutral Strategy source and review the most up to date greenhouse gas emission methodology which is then published in the annual EPA Greenhouse Gas Inventory Management Plan. This not only ensures that EPA is raising the bar when it comes to managing our emissions, but gives businesses the guidance and confidence to also do the same.’ Jason Borg, Director Business Development EPA Victoria Environmental Management Systems in Action

Greenhouse gas emissions

Under the Financial Reporting Direction 24C, the departments, the Environment Protection Authority and Sustainability Victoria are required to report on the greenhouse gas emissions associated with office-based building energy consumption, vehicle fleet use, air travel and waste disposal to landfill.

In 2009–10, total office-based greenhouse gas emissions reported for the above were

114,220 tonnes of CO2-equivalent. This excludes any offsets purchased. In 2008–09, the reported office-based greenhouse gas emissions were 109,100 tonnes 134 of CO2-equivalent. Direct, representative comparisons are difficult due to reported anomalies discussed earlier.

The following graph shows the greenhouse gas emissions produced from office-based energy consumption, vehicle fleet use, air travel and waste disposal to landfill.

Figure 9. Victorian Government greenhouse gas emission distribution for office,

by emission source 2009-10 (Tonnes CO2-e)

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Explanatory comments: • The graph represents the emissions of the departments, Sustainability Victoria and the Environment Protection Authority. • The Department of Primary Industries includes significant non-office-based data such as laboratories and research facilities that cannot be readily separated from its other data. • The data excludes any greenhouse gas emissions offsets purchased for 2009–10. • Greenhouse gas emissions associated with executive and judiciary vehicles are included where reported. • Reported emissions associated with building energy use covers 95% of departments and agencies office-based sites. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Greenhouse gas emission by department and agency – office-based The following graph shows the office-based greenhouse gas emissions produced by departments, Sustainability Victoria and the Environment Protection Authority.

Figure 10. V ictorian Government departments, EPA and SV office-based total

greenhouse gas emission distribution 2009-10 (Tonnes CO2-e)

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(*& Explanatory comments: • The Department of Primary Industries includes significant non-office-based data such as laboratories, glasshouses, research facilities, farming and plant breeding that cannot be readily separated from its other data. • The relative size of the organisation needs to be taken into account when considering this graph. • The data included in the graph excludes any greenhouse gas emissions offsets purchased. • Greenhouse gas emissions associated with executive and judiciary vehicles are included where reported.

Thinking ‘outside the square’ to report all emissions Some agencies are now reporting on other sources of greenhouse gas emissions such as paper and water use, which can be significant.

For example, the greenhouse gas emissions reported by the Department of Human Services in 2009–10, associated with paper use, through its production, is 564 tonnes of CO2-equivalent. In comparison the mandated reporting of waste emissions for that department is 177 tonnes of CO2-equivalent.

Beyond the office Managing office-based greenhouse gas emissions engages most staff. However, in many cases, the more significant environmental impacts and efficiency opportunities (financial, social and environmental) are in managing the non-office aspects of the department or agency activity such as delivery of goods and services, investment decisions, policies and partnerships.

Greenhouse gas emissions by department and agency: office-based and non- office-based The following graph, while not providing a complete picture of government operations, it does show the greenhouse gas emissions reported for 2009–10 by the departments, Sustainability Victoria and the Environment Protection Authority.

Through the development of better energy and water metering systems (which in most cases started with an office-based environment management system), a number of departments now have the data to set targets, inform decisions to reduce greenhouse gas emissions and reduce associated costs. Environmental Management Systems in Action

The following graph shows office-based (as in Figure 10) but also includes reported non- office-based energy data for building energy consumption, vehicle fleet use, air travel and waste disposal to landfill.

The Department of Primary Industries, the Department of Human Services, the Department of Justice and the Environment Protection Authority in particular are to be commended for their readiness to include non-mandated greenhouse gas emissions data in primary data sets.

Figure 11. Victorian Government departments, EPA and SV total greenhouse gas emissions for office and non-office (where reported) (Tonnes CO2-e) 2009-10

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Explanatory comments: • Non-office data sets include those of the Environment Protection Authority and the Department of Primary Industries’ research facilities, the Department of Human Services’ disability accommodation, youth justice custodial, placement and support, family, bushfire recovery, public and social housing and community building services, and the Department of Justice’s operations, including correctional centres and courts. • The relative size of the organisation needs to be taken into account when considering this graph, including number of staff, number and type of facilities and the operating hours of facilities.

The following noteworthy examples from the Department of Justice and Department of Human Services illustrate measurement and disclosures that provide information about building energy use and where substantial energy and water savings can be made.

Department of Justice

Building energy use for 2009-10 was 58,743 tonnes CO2-e Office-based 11% Complexes 11% Courts 20% Correctional centres 58%

Department of Human Services

Building energy use for 2009-10 was 156,928 tonnes CO2-e Office-based 11% Non-office 12% High-rise housing 77% From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

87

Public housing joins in The Department of Human Services is extending the scope of its environmental performance reporting to include new and existing public and social housing. A range of strategies, programs and initiatives have been implemented to improve efficiencies, delivering both environmental and financial benefits. This includes the development of 2,215 5-Star new public housing dwellings since 2001 and over 19,990 existing properties upgraded with energy and water savings features since April 2003.

In 2009–10, a development consortium was announced to deliver the Carlton Housing Redevelopment, the largest and most environmentally sustainable social and private housing redevelopment in Victoria. The redevelopment, which will have a minimum 7-Star average rating, includes passive solar design, natural ventilation, water harvesting and recycling, high- efficiency heating, photovoltaic cells, wind turbines and cogeneration systems.135

Energy use is the largest source of greenhouse gas emissions derived from office-based activity. Understanding the costs or savings associated with environmental initiatives is important not just for accountability but also for planning and budgeting purposes. Capturing these costs may also help to identify which initiatives are more cost-effective and which are less, thereby assisting departments in their selection of which initiatives to pursue.

Greenhouse gas emissions offsets The Department of Sustainability and Environment manages the offsetting of whole- of-government fleet emissions from both its passenger and executive fleet. The offsets are purchased retrospectively based on emissions reported in annual reports for the departments, Sustainability Victoria and the Environment Protection Authority. Offsets for 2008–09 vehicle fleet emissions were purchased by the Department of Sustainability and Environment in 2010.

Some departments and agencies have reported in their 2009–10 annual reports offsets including the Victorian Government fleet offset scheme. The Department of Sustainability and Environment has advised that offset purchases for 2009–10 will be considered in 2011. Offsets for 2007–08 were purchased in 2009.136

The Financial Reporting Direction 24C requires the measurement and reporting of total resource use ‘absolutes’ – such as total energy use by primary source, including GreenPower. It also requires reporting ‘intensity’ – or efficiency outcomes such as units of energy used per units of office area and units of energy used per full-time equivalent. Plans to manage resource use and to reduce greenhouse gas emissions should measure and monitor against both ‘absolutes’ and ‘intensity’ targets. Environmental Management Systems in Action

The following helps explain why it is necessary to understand both.

Comparing absolute and intensity targets Absolute targets reduce absolute emissions over time

(Example: reduce tonnes of CO2-equivalent by 20% below 2000 levels by 2020)

Advantages > Designed to achieve a reduction in a specified quantity of greenhouse gas emissions (GHG) emitted to the atmosphere

> Environmentally robust as it entails a commitment to reduce GHGs by a specified amount

> Transparently addresses potential stakeholder concerns about the need to manage absolute emissions

Disadvantages > Targets base-year recalculations for significant structural changes to the organisation add complexity to tracking progress over time

> Does not allow comparisons of GHG intensity/efficiency

> Recognises an organisation for reducing GHGs by decreasing production or output

> May be difficult to achieve if the business grows unexpectedly and growth is linked to GHG emissions

Intensity targets reduce the ratio of emissions relative to a business metric over time

(Example: reduce tonnes of CO2-equivalent 20% per square metre for building floor space between 2000 and 2011)

Advantages > Reflects GHG performance improvements independent of organic growth or decline

> Targets base-year recalculations for structural changes are usually not required

> May increase the comparability of GHG performance among companies

Disadvantages > No guarantee that GHG emissions to the atmosphere will be reduced – absolute emissions may rise even if intensity goes down and output increases

> Businesses with diverse operations may find it difficult to define a single common business metric

> If a monetary variable is used for the business metric, such as dollar of revenue or sales, it must be recalculated for changes in product prices and product mix, as well as inflation, adding complexity to the tracking process.137

From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Procurement

With significant buying power, purchasing by the Victorian Government can influence the supply chain in several ways. It may be through the delivery of specific environmental objectives in procuring goods and services or in developing relationships with its supply chain providers to influence their broader environmental performance, the uptake of environmental sustainability innovative technology and support for green industries.138

It starts to get real when people believe these matters are strategic – that they will shape the future of the business – the sustainable supply chain.139

Green procurement should become the usual business approach for Victorian Government departments and agencies. There are significant opportunities for government to continue work in reviewing its procurement structures and partner with suppliers to integrate sustainability.140

The Financial Reporting Direction 24C requires all departments, the Environment Protection Authority and Sustainability Victoria to report on progress in incorporating environmental considerations into purchasing decisions.

Further disclosure about the proportion of procurement activities that have incorporated environmental considerations and the extent to which those environmental considerations are integrated into all procurement policies should be given priority.

The Public Accounts and Estimates Committee reiterates this need for further disclosure in its report on the 2008–09 Financial and Performance Outcomes in May 2010.141

A range of actions were reported for 2009–10, from promoting the ‘green’ stationery guide, to energy efficiency in buildings and information and communications technologies, to embedding environmental criteria into tender documents. Just over half the departments and agencies included environmental procurement targets for office- related procurement.

The Environment Protection Authority and the Department of Treasury and Finance reported progress on developing sustainable procurement policies and frameworks. The Environment Protection Authority will be trialling its Sustainable Purchasing Framework with key purchasing staff and hopes to have the framework fully operational by June 2011.

In its annual report, the Victorian Government Purchasing Board advised that the Department of Justice added a number of environmental products to its range of office supplies such as recycled or recyclable items and environmental sustainability was incorporated into procurement processes and practices of the Department of Health and the Department of Human Services.142

The Department of Treasury and Finance has developed a sustainable procurement policy for its operations. The department is reviewing the state purchasing contracts in relation to environmental criteria and processes for evaluating environmental benefits offered by suppliers. The department was awarded a special commendation for excellence in green purchasing at the ECO-Buy industry awards in May 2010 for the inclusion of sustainability criteria in the templates for tender evaluation, developed with assistance from the Department of Primary Industries. Appendixes

Appendix 1: Strategic audit methodology

Objective

The strategic audit strives for best practice review by means of both qualitative and quantitative analytical excellence. It is not simply concerned with the study of data and its tabulation for the purpose of a routine compliance exercise. The legislative intent is that organisational structures will be examined, together with practices, processes and the data that can be extracted from operational activities.

Methodology

The audit is evidence-based, using information obtained from department and agency annual reports and a questionnaire. Stakeholder consultation, workshop and independent research are also undertaken to assist in the evaluation of data and the analysis of trends.

As noted in last year’s audit, the conduct of the strategic audit is not a conventional auditing function. It is becoming an evaluation that generates a culture of evaluation influence and reflection. Instead of being seen as an imposition and a process that is focused on finding fault, this audit is undertaken in a manner which represents an opportunity for departments and agencies to improve environmental performance.

Data is collected and examined to clarify what it means and whether it fully captures operational activity. Some findings might require further evaluation. Comments are sought from those whose work and workplaces are being evaluated. In this process, they also raise areas of interest and prospects for improvement on their previous year’s work. Consultations are held across portfolios and staff members are interviewed and formally and informally brought into the audit. The audit also takes account of where the government activities are located and what the departments’ work entails. The audit considers ways in which agencies are working with their stakeholders and crossing ‘traditional’ boundaries in implementing environmental management systems.

This year a questionnaire, provided below, was distributed to the departments, Environment Protection Authority and Sustainability Victoria. The questions were designed to improve understanding about the way implementing environmental management systems supports the broader integration of environmental sustainability, including carbon abatement, into everyday government operations and decision-making processes.143

A workshop followed in October 2010, with staff from each of the 11 departments, the Environment Protection Authority, Sustainability Victoria, and representatives from Victoria Police, VicRoads and Melbourne Water.

Information obtained from annual reports is taken as authoritative and therefore only limited data verification is undertaken in relation to the Financial Reporting Direction 24C information. To illustrate key trends and concepts in the narrative, a number of quantitative headline indicators are used. Data to fulfil the indicators is drawn from available, relevant, valid and reliable sources. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

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Qualitative data is drawn from conversations, interviews, case studies, workshops and observation. This report is an analysis of findings, not merely a report on findings. The focus is on key themes and emerging issues to enhance environmental performance and to go ‘beyond compliance’. The process is rigorous, transparent and serves to inform the government and empower the community to make changes. This work will help to reduce Victoria’s greenhouse gas emissions and assist our community to adapt to the impacts of climate change. The departments and agencies covered by this strategic audit are listed below.

Questionnaire

The following questions were distributed to departments, Sustainability Victoria and the Environment Protection Authority as part of the strategic audit process. The questions seek to provide information about the way in which environmental management systems support the broader integration of environmental sustainability, including carbon abatement, into everyday government operations and decision-making processes:

> Does environmental management system reporting inform departmental corporate planning cycles and if so how?

> What involvement does senior management have with the environmental management system process?

> Where does responsibility for environmental management system leadership rest within your organisation?

> Indicate how your department/agency has included environmental sustainability into key organisational decision-making processes, such as major planning and risk management processes?

> Indicate how your department/agency has incorporated into work plans and key performance indicators, environmental management system-related issues, such as energy and water use and carbon abatement?

> Describe your department’s progress towards implementing the Greener Government Buildings Program.

> Outline your department’s efforts to implement the Environmentally Sustainable Information and Communications Technology (ICT) policy.

Departments and agencies covered by the Agencies participating in the case studies strategic audit 2010 Film Victoria Museum Victoria Department of Education and Early Childhood Development Parks Victoria Department of Health Public Record Office Victoria Department of Human Services State Library of Victoria Department of Innovation, Industry and Regional Development (now Department of Business and Innovation) Victorian Electoral Commission Department of Justice Zoos Victoria Department of Premier and Cabinet Department of Planning and Community Development Department of Primary Industries Department of Sustainability and Environment Department of Treasury and Finance Department of Transport Environment Protection Authority Victoria Sustainability Victoria VicRoads (FRD24C reporting only as per previous years) Appendixes

Appendix 2: Global Reporting Initiative - who is reporting? Private and public sector organisations listed on the GRI website as having produced a report in Australia in accordance with the GRI guidelines in 2009.144

GRI Listed Reports published in Australia in 2009*

Private and not-for-profit sectors Public sector

3M Illawarra Coal City of Melbourne ActewAGL Incitec Pivot Department of Sustainability AGL Insurance Australia Group (IAG) and Environment (DSE) Amcor Kingsgate Department of Families, Housing, Community Services Australia and New Zealand Banking Landcare Australia and Indigenous Affairs (FaHCSIA) Group ANZ Landcom Australia Post LGL Australian Ethical Investment Ltd Lion Nathan Banarra Sustainability Maunsell AECOM Assurance and Advice Mecu BHP Billiton National Australia Bank (NAB) Boral Net Balance Management Brambles Optus Canon Oceania Orica City Power and Powercor Australia OZ Minerals Pacific Corporate Express Australia Hydro PanAust CPA Australia Panoramic Resources Credit Union Foundation Australia Parsons Brinckerhoff CSIRO Port of Brisbane CSL Qantas CUFA Rio Tinto Iron Ore Dexus Ruah Community Services East Gippsland Water Sensis Engineers Australia Stockland Ergon Energy Sydney Water Finsbury Green Telstra Forests NSW The GPT Group Fosters The Water Corporation Fuji Xerox Australia Toyota Australia Goodman Fielder Transfield Services GWM Water Transurban Group Hatch Associates Perth Hub VicSuper Henry Davis York Lawyers (HDY) Westpac Banking Corporation Hi Fert Woolworths Hydro Tasmania Xstrata Coal

Private Sector (n = 69) Public Sector (n = 3)

*the list of GRI reports published in 2010 was incomplete at the time of compiling this report. From the Commissioner 5 Why we bother 8 Part 1 Organisational structures 12 Part 2 Agencies 28 Part 3 Environmental management 58 Appendixes 90 Endnotes 93

Endnotes 93

1 See the CSIRO BOM State of the Climate Report 27 B Doppelt, 2003, Leading change toward 55 A Buono and K Kerber, 2010, ‘Creating a sustainable 2010; CSIRO OzCoasts 2010 sustainability: a change management guide for approach to change: building organisational change business, government and civil society, Greenleaf capacity’, SAM Advanced Management Journal, 2 Against the 100–150 years of historical observations Publishing, Sheffield, p 81 Spring, pp 7, 8 and 10 of heat impacts the 2009 heatwave was exceptional. The deaths of 374 people in Melbourne and between 28 D Rainey, 2006, ‘Sustainable business development: 56 A Buono and K Kerber, 2010, ‘Creating a sustainable 50–150 deaths in Adelaide, together with 3000 inventing the future through strategy, innovation, and approach to change: building organisational change reports of heat-related illness have been attributed leadership, Cambridge University Press, Cambridge, capacity’, SAM Advanced Management Journal, to 2009 severe, extensive and prolonged heat. Jim p 176 Spring, pp 10 and 11 Reeves, Colleen Foelz, Peter Grace, Peter Best, 29 B Doppelt, 2003, Leading change toward 57 This refers to the complexity of the organisation Torben Marcussen, Shahbaz Mushtaq, Roger Stone, sustainability: a change management guide for involved in the change, such as the organisation’s Margaret Loughnan, Darryn McEvoy, Ifte Ahmed, business, government and civil society, Greenleaf size, geographical dispersion, the complexity of Jane Mullet, Katharine Haynes, Deanna Bird, Publishing, Sheffield, p 216 interdependencies between business units, the Lucinda Coates and Megan Ling, 2010, NCCARF number of products and services, the number and Report: Case studies of extreme events. Impacts 30 P Mirvis, B Googins, S Kinnicutt, 2010, ‘Vision, diversity of stakeholders, etc; A Buono and K Kerber, and adaptation response of infrastructure and mission and values: guideposts to sustainability’, 2010, ‘Creating a sustainable approach to change: communities to heatwaves: the southern Australian Organisational Dynamics, vol 39, p 322 building organisational change capacity’, SAM experience of 2009 31 United Nations Global Compact, 2010, ‘A new era of Advanced Management Journal, Spring, p 8 3 R Garnaut, 2008, The Garnaut Climate Change sustainability: UN Global Compact-Accenture CEO 58 This refers to the amount and nature of information, Review, Cambridge University Press, Australia study 2010’, p 44 processing and decision making required for the 4 Climate Works Australia, 2010, Low Carbon Growth 32 United Nations Global Compact, 2010, ‘A new era of change. For example: Are there known ways to Plan for Australia, Victoria sustainability: UN Global Compact-Accenture CEO approach a situation? Is there an understandable study 2010’, p 44 sequence of steps that can be followed? Is there 5 Commissioner for Environmental Sustainability Act an identifiable set of established procedures and 2003, section 8 (b) 33 L. L. Shy and Max H. Bazerman, 2010, ‘Cognitive practices? In high socio-technical situations, the Barriers to environmental action: problems and 6 Ibid, section 3 solution to the change and the problem are not solutions’, Harvard Business School Working Paper 7 known or fully understood; A Buono and K Kerber, Commissioner for Environmental Sustainability, 2010, no 11-046, p 11-12. 2010, ‘Creating a sustainable approach to change: Strategic audit Addressing our future, Government 34 United Nations Global Compact, 2010, ‘A new era of building organisational change capacity’, SAM of Victoria sustainability: UN Global Compact-Accenture CEO Advanced Management Journal, Spring, p 9 8 United Nations Global Compact, 2010, ‘A new era of study 2010’, p 44 59 A Buono and K Kerber, 2010, ‘Creating a sustainable sustainability: UN Global Compact-Accenture CEO 35 United Nations Global Compact, 2010, ‘A new era of approach to change: building organisational change study 2010’, p 10 sustainability: UN Global Compact-Accenture CEO capacity’, SAM Advanced Management Journal, 9 United Nations Global Compact, 2010, ‘A new era of study 2010’, p 44 Spring, pp 8-9 sustainability: UN Global Compact-Accenture CEO 36 Australian Research Institute in Education for 60 For example, see D Crews, 2010, ‘Strategies study 2010’, pp 10 and 32 Sustainability, 2007, Sustainability in government: for implementing sustainability: five leadership 10 T Porter, 2008, ‘Managerial applications of making change for sustainability: perspectives from challenges’, SAM Advanced Management Journal, corporate social responsibility and systems thinking the Australian public service, ARIES, Macquarie Spring, p 18 for achieving sustainability outcomes’, Systems University, Sydney, p 11 61 D Dunphy, A Griffiths and S Benn, 2007 Research and Behavioural Science, vol. 25, p 397 37 D Dunphy, A Griffiths and S Benn, 2007 ‘Organisational change for corporate sustainability: 11 United Nations Global Compact, 2010, ‘A new era of ‘Organisational change for corporate sustainability: a guide for leaders and change agents of the future’, sustainability: UN Global Compact-Accenture CEO a guide for leaders and change agents of the future’, Routledge, New York, pp 183-184 study 2010’, p 11 Routledge, New York, p 82 62 For example, see S Hunting and D Tilbury, 2006, 12 United Nations Global Compact, 2010, ‘A new era of 38 D Dunphy, A Griffiths and S Benn, 2007 ‘Shifting towards sustainability: six insights into sustainability: UN Global Compact-Accenture CEO ‘Organisational change for corporate sustainability: successful organisational change for sustainability’, study 2010’, p 11 a guide for leaders and change agents of the future’, Australian Research Institute in Education for Routledge, New York, p 95 Sustainability, Macquarie University, Sydney, pp 13 D Crews, 2010, ‘Strategies for implementing 39 31-35; S Benn and E Baker, 2009, ‘Advancing sustainability: five leadership challenges’, SAM P Crittenden, S Benn, and D Dunphy, 2010, sustainability through change and innovation: a Advanced Management Journal, Spring, p 15 ‘Learning and change for sustainable at Yarra Valley co-evolutionary perspective’, Journal of Change Water: a case study’, Australian Research Institute 14 B Doppelt, 2003, Leading change toward Management, pp 386-389; T Porter, 2008, in Education for Sustainability, Macquarie University, sustainability: a change management guide for ‘Managerial applications of corporate social Sydney, p 4 business, government and civil society, Greenleaf responsibility and systems thinking for achieving Publishing, Sheffield, p 71; D Dunphy, A Griffiths 40 P Crittenden, S Benn, and D Dunphy, 2010, sustainability outcomes’, Systems Research and and S Benn, 2007 ‘Organisational change for ‘Learning and change for sustainable at Yarra Valley Behavioural Science, vol. 25, p 399 corporate sustainability: a guide for leaders and Water: a case study’, Australian Research Institute 63 B Doppelt, 2003, Leading change toward change agents of the future’, Routledge, New in Education for Sustainability, Macquarie University, sustainability: a change management guide for York, p 93; M Epstein, A Buhovac and K Yuthas, Sydney, pp 6-7 business, government and civil society, Greenleaf ‘Implementing sustainability: the role of leadership 41 P Crittenden, S Benn, and D Dunphy, 2010, Publishing, Sheffield, pp 213-220 and organisational culture’, Strategic Finance, April, ‘Learning and change for sustainable at Yarra Valley pp 44-45 64 B Doppelt, 2003, Leading change toward Water: a case study’, Australian Research Institute 15 sustainability: a change management guide for M Epstein and A Buhovac, 2010, ‘Solving in Education for Sustainability, Macquarie University, business, government and civil society, Greenleaf the sustainability implementation challenge, Sydney, p 7 Publishing, Sheffield, pp 211 and 216 Organisational Dynamics, vol 39, p 313 42 P Crittenden, S Benn, and D Dunphy, 2010, 65 16 B Doppelt, 2003, Leading change toward See generally D Dunphy, A Griffiths and S Benn, ‘Learning and change for sustainable at Yarra Valley sustainability: a change management guide for 2007 ‘Organisational change for corporate Water: a case study’, Australian Research Institute business, government and civil society, Greenleaf sustainability: a guide for leaders and change agents in Education for Sustainability, Macquarie University, Publishing, Sheffield, pp 215-216 of the future’, Routledge, New York; and B Doppelt, Sydney, p 7 2003, Leading change toward sustainability: a 66 B Doppelt, 2003, Leading change toward 43 B Doppelt, 2003, Leading change toward change management guide for business, government sustainability: a change management guide for sustainability: a change management guide for and civil society, Greenleaf Publishing, Sheffield business, government and civil society, Greenleaf business, government and civil society, Greenleaf Publishing, Sheffield, p 212 17 A van der Heijden P Driessen, and J Cramer, 2010, Publishing, Sheffield, p 216 ‘Making sense of corporate social responsibility: 67 D Dunphy, A Griffiths and S Benn, 2007 44 A Griffiths and J Petrick, 2001, ‘Corporate exploring organisational processes and strategies’, ‘Organisational change for corporate sustainability: a architectures for sustainability’ International Journal Journal of Cleaner Production, vol. 18, p 1; Most guide for leaders and change agents of the future’, of Operations & Production Management, vol. 21, studies on organisational structures over the last Routledge, New York, pp 95-97 p 1573 few decades have focused on determining the 68 45 M de al Cruz Deniz-Deniz and C Zarraga-Oberty, structures that contribute to staff satisfaction, A Griffiths and J Petrick, 2001, ‘Corporate 2004, ‘The assessment of the stakeholders’ growth and development and that increase architectures for sustainability’ International Journal environment in the new age of knowledge: an profitability and productivity; A Griffiths and J Petrick, of Operations & Production Management, vol. 21, empirical study of the influence of the organisational 2001, ‘Corporate architectures for sustainability’ p 1574 structure’, Business Ethics: A European Review, International Journal of Operations & Production 46 vol. 13, p 372 Management, vol. 21, p 1576 B Doppelt, 2003, Leading change toward sustainability: a change management guide for 69 18 D Rainey, 2006, ‘Sustainable business development: B Doppelt, 2003, Leading change toward business, government and civil society, Greenleaf inventing the future through strategy, innovation, and sustainability: a change management guide for Publishing, Sheffield, p 81 leadership, Cambridge University Press, Cambridge, business, government and civil society, Greenleaf 47 p 361 Publishing, Sheffield, p 83 D Rainey, 2006, ‘Sustainable business development: inventing the future through strategy, innovation, and 70 19 Australian Research Institute in Education for B Doppelt, 2003, Leading change toward leadership, Cambridge University Press, Cambridge, Sustainability, 2007, Sustainability in government: sustainability: a change management guide for p 113 making change for sustainability: perspectives from business, government and civil society, Greenleaf 48 the Australian public service, ARIES, Macquarie Publishing, Sheffield, p 82 B Doppelt, 2003, Leading change toward sustainability: a change management guide for University, Sydney, pp 8 and 13 20 D Dunphy, A Griffiths and S Benn, 2007 business, government and civil society, Greenleaf 71 A Griffiths and J Petrick, 2001, ‘Corporate ‘Organisational change for corporate sustainability: a Publishing, Sheffield, pp 80-81 architectures for sustainability’ International Journal guide for leaders and change agents of the future’, 49 of Operations & Production Management, vol. 21, Routledge, New York B Doppelt, 2003, Leading change toward sustainability: a change management guide for p 1581 21 B Doppelt, 2003, Leading change toward business, government and civil society, Greenleaf 72 B Doppelt, 2003, ‘Overcoming the seven sustainability: a change management guide for Publishing, Sheffield, p 17 sustainability blunders’, The Systems Thinker, vol. business, government and civil society, Greenleaf 50 14, p 3 Publishing, Sheffield, p 216 B Doppelt, 2003, Leading change toward sustainability: a change management guide for 73 22 B Doppelt, 2003, Leading change toward N Nohria, Harvard Business School, 1995, ‘Note on business, government and civil society, Greenleaf sustainability: a change management guide for organisational structure’, p 1 Publishing, Sheffield, p 216 business, government and civil society, Greenleaf 23 N Nohria, Harvard Business School, 1995, ‘Note on 51 A Buono and K Kerber, 2010, ‘Creating a sustainable Publishing, Sheffield, p 234 organisational structure’, pp 2-4 approach to change: building organisational change 74 A Griffiths and J Petrick, 2001, ‘Corporate capacity’, SAM Advanced Management Journal, 24 N Nohria, Harvard Business School, 1995, ‘Note on architectures for sustainability’ International Journal Spring, p 4 organisational structure’, pp 4-9; B Doppelt, 2003, of Operations & Production Management, vol. 21, Leading change toward sustainability: a change 52 United Nations Global Compact, 2010, ‘A new era of pp 1581-1583 management guide for business, government and sustainability: UN Global Compact-Accenture CEO 75 Senge, 2006, quoted in D Crews, 2010, ‘Strategies civil society, Greenleaf Publishing, Sheffield, pp study 2010’, p 44 for implementing sustainability: five leadership 217-218 53 A Griffiths and J Petrick, 2001, ‘Corporate challenges’, SAM Advanced Management Journal, 25 N Nohria, Harvard Business School, 1995, ‘Note on architectures for sustainability’ International Journal Spring, p 18 organisational structure’ pp 4-9 of Operations & Production Management, vol. 21, 76 S Hunting and D Tilbury, 2006, Shifting towards p 1582 26 Ackoff, 1999, cited in B Doppelt, 2003, Leading sustainability: six insights into successful change toward sustainability: a change management 54 A Buono and K Kerber, 2010, ‘Creating a sustainable organisational change for sustainability, ARIES, guide for business, government and civil society, approach to change: building organisational change Macquarie University, Sydney, p 15 Greenleaf Publishing, Sheffield, 2003, p 73 capacity’, SAM Advanced Management Journal, Spring, p 5 Endnotes

77 Dennis Campbell, Marc Epstein, Asis Martinez- 103 Lisa L. Shu and Max H. Bazerman, 2010, 126 Excluding Department of Education and Jerez, 2010, ‘The Learning Effects of Monitoring’ ‘Cognitive barriers to environmental action: Early Childhood and Development and the Harvard Business School Working Paper, no. problems and solutions’, in Harvard Department of Health. Litres per day is based on 11-053, Harvard Business School, Boston Business School Working Knowledge 250 work days. Papers http://hbswk.hbs.edu/item/6576. 78 D Crews, 2010, ‘Strategies for implementing 127 The reported vehicle fleet covers the html?wknews=122020 s sustainability: five leadership challenges’, SAM departments, the Environment Protection Advanced Management Journal, Spring, p 18 104 http://epress.anu.edu.au/anzsog/public_ Authority and Sustainability Victoria’s passenger leadership/mobile_devices/ch10s04.html vehicles including the Vicfleet vehicle pool. 79 D Rainey, 2006, ‘Sustainable business development: inventing the future through 105 Toyota Motor Corporation Australia Limited, 128 http://www.greenvehicleguide.gov.au/ strategy, innovation, and leadership, Cambridge 2010, Toyota 2010 Sustainability Report, pp GVGPublicUI/home.aspx University Press, Cambridge, p 364 23-25 129 Based on vehicle profile data provided by 80 B Doppelt, 2003, Leading change toward 106 http://www.fwa.gov.au/documents/agreements/ Vicfleet, October 2010. sustainability: a change management guide for fwa/AE880750.pdf 130 Based on vehicle profile data provided by business, government and civil society, Greenleaf downloaded 6 January 2011 pp10-11 Vicfleet, October 2010. Publishing, Sheffield, p 234 107 The Commissioner’s 2009 strategic audit report, 131 Recommendation 26, FRD24C reports to 81 B Doppelt, 2003, Leading change toward recommended, that performance criteria in include the number of hybrid electric, LPG and sustainability: a change management guide for management frameworks of senior executives four-cylinder cars Public Accounts and Estimates business, government and civil society, Greenleaf should include the disclosure and reporting Committee, 94th Report to the Parliament: Publishing, Sheffield, pp 231 and 234 against environmental targets. report on the 2008–09 financial and performance 82 T Porter, 2008, ‘Managerial applications of 108 http://www.5starsustainability.vic.gov.au/Public/ outcomes, May 2010 corporate social responsibility and systems Home.aspx?ReturnUrl=/default.aspx 132 Department of Justice and Department of thinking for achieving sustainability outcomes’, 109 Smarter Government: Victorian Public Service Human Services have indicated that the Systems Research and Behavioural Science, (VPS) innovation action plan, 2010 2008-09 greenhouse gas emission data vol. 25, p 406 sets were incomplete for 2008-09. Direct 110 Department of Health (2010), Guidelines for 83 T Porter, 2008, ‘Managerial applications of comparisons were not provided in their 2009-10 sustainability in health care capital works. www. corporate social responsibility and systems annual reports between these two years and capital.health.vic.gov.au/sustainability/ thinking for achieving sustainability outcomes’, Department of Health data reported separately Systems Research and Behavioural Science, 111 INTOSAI Working Group on Environmental for the first time. For 2009-10, these three vol. 25, pp 406-407 Auditing, ‘Sustainable Development: The Role of departments air travel related emissions make Supreme Audit Institutions’ (2004), 18 up 38% of the whole of government. 84 P Crittenden, S Benn, and D Dunphy, 2010, ‘Learning and change for sustainable at Yarra 112 ISO 14001 is the recognised international 133 The Greenhouse Gas Protocol (GHG Protocol), Valley Water: a case study’, Australian Research voluntary standard that sets out generic published by the World Business Council Institute in Education for Sustainability, Macquarie requirements for the preparation of an EMS. It for Sustainable Development and the World University, Sydney, p 7 requires an organisation to prepare an EMS that Resources Institute, is a standard used by identifies and controls the environmental impact many organisations across the globe to 85 P Crittenden, S Benn, and D Dunphy, 2010, of its services or products, continually improves identify, measure, and manage greenhouse gas ‘Learning and change for sustainable at Yarra its environmental performance; and implements emissions. The GHG Protocol defines emissions Valley Water: a case study’, Australian Research a systematic approach to setting, achieving as direct and indirect emissions as follows and Institute in Education for Sustainability, Macquarie and monitoring progress towards meeting categorises into three broad scopes: University, Sydney, p 13 environmental objectives and targets. scope 1: these are direct emissions generated 86 Boundary objects are ‘artifacts, documents, 113 The FRD 24C requires all Victorian State from any sources that are owned or terms, concepts, and other forms of reification Government Departments, Sustainability controlled by the organisation, such around which communities of practice can Victoria and the Environment Protection as emissions associated with an organise their interconnections’; Suzanne Authority to report against office – based organisation’s vehicle fleet Benn and Andrew Martin, 2010, ‘Learning and environmental performance indicators in their change for sustainability reconsidered: a role for scope 2: these are indirect emissions generated annual reports boundary objects’, Academy from the consumption of electricity of Management Learning & Education, vol. 9, 114 The Department of Treasury and Finance issues or heat purchased from another pp 397-412 Financial Reporting Directions (FRDs) to ensure organisation in equipment or during consistent application of accounting treatment operations that are owned or controlled 87 Australian Research Institute in Education for across the Victorian public sector. FRDs are also by the organisation, such as electricity Sustainability, 2007, Sustainability in government: issued for other government non-financial policy consumption and energy use in an making change for sustainability: perspectives and disclosure requirements such environmental office building from the Australian public service, ARIES, performance. Macquarie University, Sydney, p 8 scope 3: these are all other indirect emissions 115 Department of Education and Early Childhood generated as a result of the activities of 88 B Doppelt, 2003, Leading change toward Development (DEECD), Department of Human an organisation, such as the disposal of sustainability: a change management guide for Services (DHS), Department of Health (DOH), waste and employee air travel. business, government and civil society, Greenleaf Department of Justice (DOJ), Department of Publishing, Sheffield, pp 125-126; S Hunting and 134 Commissioner for Environmental Sustainability, Innovation, Industry and Regional Development D Tilbury, 2006, Shifting towards sustainability: Strategic Audit, Environmental Management (DIIRD) (now known as the Department of Business six insights into successful organisational change Systems: Addressing our Future, January 2010 and Innovation (DBI)), Department of Premier for sustainability, ARIES, Macquarie University, and Cabinet (DPC), Department of Planning and 135 http://www.dhs.vic.gov.au/data/assets/ Sydney, p 25 Community Development (DPCD), Department pdf_file/0010/480808/DHS-annual- 89 S Hunting and D Tilbury, 2006, Shifting towards of Primary Industries(DPI), Department of Report-2009-2010.pdf sustainability: six insights into successful Sustainability and Environment(DSE), Department 136 Advised by Department of Sustainability and organisational change for sustainability, ARIES, of Treasury and Finance (DTF), Department of Environment September 2010. Macquarie University, Sydney, p 25 Transport (DOT), Environment Protection Authority Victoria (EPA) and Sustainability Victoria (SV). 137 World Resources Institute and World Business 90 United Nations Global Compact, 2010, ‘A new Council for Sustainable Development, March era of sustainability: UN Global Compact- 116 Global Reporting Initiative is a widely used, 2004, The Greenhouse Gas Protocol, A Accenture CEO study 2010’, p 11 internationally recognised reporting framework Corporate Accounting and Reporting Standard, developed in 1997 by the Coalition for 91 United Nations Global Compact, 2010, ‘A new Revised Edition Environmentally Responsible Economies era of sustainability: UN Global Compact- (CERES) and United Nations Environment 138 Commissioner for Environmental Sustainability, Accenture CEO study 2010’, p 11 Programme (UNEP). 2010, Addressing our Future: Strategic audit, 92 United Nations Global Compact, 2010, ‘A new Environmental management Systems 117 Based on Commissioner for Environmental era of sustainability: UN Global Compact- Sustainability strategic audit reports – data 139 Harvard Business Review October 2010, Accenture CEO study 2010’, p 42 sourced from departments’, Sustainability Victoria, page 70 93 Maria May Seitanidi and Andrew Crane, 2009, Environment Protection Authority annual reports 140 Commissioner for Environmental Sustainability, ‘Implementing CSR through partnerships 118 Public Accounts and Estimates Committee Strategic Audit, Environmental Management – understanding the selection, design and Report on the 2008-09 Financial and Systems: Addressing our Future, January 2010 institutionalisation of nonprofit-business Performance Outcomes in May 2010 partnerships’, Journal of Business Ethics, vol. 141 Report on the 2008-09 Financial and 85, pp 414-429 119 For comparison purposes, Department of Health Performance Outcomes, Public Accounts and has been excluded, formed in August 2009, Estimates Committee (Parliament of Victoria) 94 D Bartlett, 2009, ‘Embedding corporate with no comparative prior year data reported. May 2010, page 265 responsibility: the development of a Department of Education and Early Childhood transformational model of organisational 142 and Development has been excluded due to Victorian Government Purchasing Board, Annual innovation’, Corporate Governance, vol. 9, p 415 significant reported variations and data sets Report 2009-1, September 2010 95 D Bartlett, 2009, ‘Embedding corporate not reliable for whole of government trend 143 An environmental management system responsibility: the development of a comparisons. The Department has advised is defined under the Commissioner for transformational model of organisational improved data verification and assurance Environmental Sustainability Act, 2003 as: innovation’, Corporate Governance, vol. 9, p 417 processes are in place for 2010-11. ...the organisational structure, policies, practices, processes and procedures for 96 United Nations Global Compact, 2010, ‘A new 120 Excluding Department of Education and Early implementing environmental management, era of sustainability: UN Global Compact- Childhood Development and Department of including systems for designating responsibility Accenture CEO study 2010’, p 43 Health for and allocating resources to, environmental 97 Sarah Brophy and Elizabeth Wylie’s book ‘The 121 Victorian Government, 2007, Government management. green museum. A primer on environmental Sustainable Energy Targets Progress report 144 The Global Reporting Initiative (GRI) web portal practice, 2008 122 For comparison purposes, Department of lists organisations that have registered their GRI 98 Matyas J in Brophy SS and Wylie E (2008) The Health (DOH) has been excluded, formed in sustainability reports. Note: not all GRI reporters Green Museum: a primer on environmental August 2009, with no comparative prior year publish reports on an annual basis. This listing practice, AltaMira Press, Plymouth (p.120) data reported. may be found at http://www.globalreporting. org/ReportServices/GRIReportsList 99 Film Victoria Act 1981. 123 Office-based paper consumption excludes envelopes and external printing and publications. 100 Green Screen Committee Media Release, 2010. 124 101 1 ream=500 sheets. Sheets per day figure based http://www.thepracticeofleadership. on 250 work days per year. net/2010/01/03/john-kotter-defines-leadership/, 6 December 2010 125 For comparison purposes, Department of Health

102 (DOH) has been excluded, formed in August The Ecological Footprint of Victorian Hospitals 2009, with no comparative prior year data Study, commissioned in 2009, found for reported. Department of Education and Early Southern Health (Victoria’s largest health service) Childhood and Development has been excluded that around 57% of the ecological footprint due to significant reported variations and data related to procurement. A carbon emissions sets not reliable for whole of government trend study undertaken in 2004 for the UK’s National comparisons. Health Service found that 60% related to procurement.

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