At the time Green to Gold was published in late 2006, the European Union promulgated a far-reaching new regulation that will have a wide impact on companies: Registration Evaluation Authroisation of Chemicals, referred to as the REACH regulation or program. The REACH program is very complex, providing many issues to consider; some highlights are presented here, with a focus on business strategy-related issues.
REACH in a Nutshell
In a nutshell, REACH presents a framework that fundamentally turns the tables on the relationship between government and business in characterizing the risk of chemicals used in the marketplace. Traditionally, throughout the world, governmental entities have shouldered the burden in chemical risk determinations. With REACH in the EU, this burden shifts to the manufacturers and end users of chemicals. Registrations will be required for both single chemicals and substances that contain multiple chemicals. At the core of this process is the determination of exposure scenarios and associated risks.
There are at least 10 to 15 steps (depending on how you count them) that a business must take to register a chemical, depending upon chemical classification, volume used, and toxicity. Some of these steps include:
- Prepare substance inventory list
- Company planning and management of REACH
- Pre-registration, refinement of inventory
- Collect existing exposure and hazard
- Supply chain management—identify the supply chains
- Collect data up and down the supply chain
- Hazard evaluation
- Develop registration dossier—information and test plans
- Develop exposure scenarios
- Prepare Chemical Safety Reports
- Registration
The REACH timeline is aggressive. Companies began submitting pre-registration information in 2008, with importers and manufacturers of new substances making submissions by June 1, 2008. All chemicals need to be pre-registered by December 1, 2008. The submission of Chemical Safety Reports (CSR) are required beginning in 2010 and extends to 2018 for lower volume and risk chemicals.
Even though REACH is a European initiative, businesses in America need to take notice. This is of course the case if an American business is multinational with operations in Europe, but consideration should also be made for domestic businesses if they are supplying chemicals or substances that fall within the purview of REACH. Additionally, policymakers and regulators in the United States have indicated that are considering the development of a REACH-like program.
Company Planning and Management of REACH
On first blush it would appear that REACH addresses purely technical issues that EHS professionals need to address as with any other regulatory-compliance challenge. This is partially correct—the core activities are technical. However, examining REACH from a broader perspective, and I believe the wiser perspective, reveals that it could impact the core of a company’s business strategy. From this perspective, companies will have to make fundamental benefit/cost analyses for some or many of their activities; they will have to consider how they plan to handle proprietary issues and trade secretes; they will have to look anew or once again at risk issues associated with their activities and how these issues might impact discovery in civil litigation. This bundle of issues is not trivial and will require an integration of EHS thinking and business strategy as suggested in Green to Gold and Quantum EHS.
© Redinger EHS, Inc. (2010)