Sustainability

2024 : We are experiencing the bust, are we prepared for the boom?

Dr Troy Coyle, CEO NZ Heavy Engineering Research Association (HERA) 2024 was a difficult year for construction and therefore manufacturing supply chains supporting it. Our levy, which is legislated under the Heavy Engineering Research Levy Act, 1968, is a reliable indicator of sector activity (at least in the segments that use structural steel, such as multi-storey residential, commercial and bridges). In June this year, we experienced the lowest levy level of any month in more than ten years. Boom and bust cycles are a pattern that is pretty consistent, and which we are not really learning how to avoid (e.g. through planned, transparent and sustainable infrastructure investments). The consequence is that in the bust, which we are certainly in, there is a significant reduction in the employment of our skilled workforce. Then, in the boom, we no longer have the available skilled workforce available to meet demand. They have mostly gone offshore. It would certainly help the sector if there was a bilaterally supported pipeline of national infrastructure projects, with a secured budget allocation, that were consciously timed to ensure stability of construction. Combine a construction bust with an inexplicable proposed “reform” of the Vocational Education System introduced by the Hon Penny Simmonds, Minister for Tertiary Education and Skills in 2024, and things are not looking good for the future of our sector. The link between boom and bust cycles and instability in our vocational education system means that looking ahead (possibly in 2026), construction-related manufacturing could experience an unprecedented skilled labour shortage when the market recovers. Our industry is reliant upon skilled apprentices and concerningly, at the moment, there doesn’t seem to be a lot of Government support for work-based learning appearing within the planned “reform”. For steel, there are also potential concerns with the proposed Building (Overseas Building Products, […]

How manufacturers can prepare for the ESPR

www.thinkstep-anz.com Image by Dinh Khoi Nguyen from Pixabay. As global sustainability regulations evolve, New Zealand manufacturers must stay ahead of the curve to maintain their competitive edge, especially with upcoming policies like the European Union’s Ecodesign for Sustainable Products Regulation (ESPR). But what is the ESPR, and how can manufacturers in New Zealand prepare for it? What is the ESPR? The ESPR is a new EU policy aimed at making products more sustainable and circular throughout their lifecycle, supporting the EU’s 2050 climate goals. The ESPR applies to products sold within the EU, setting specific sustainability requirements for design, use and disposal. It applies to most products sold in the EU, except for some like food and medicines. Non-compliant products may face fines or bans. Although it took effect in July 2024, the detailed rules will be developed over the next year. The regulation aims to make products more durable, reusable, repairable, and recyclable, while banning the destruction of unsold goods like electronics and textiles. A digital product passport will also be required, giving consumers direct access to sustainability data and exposing brands to greenwashing claims under the Green Claims Directive. Why should New Zealand manufacturers pay attention to ESPR? For manufacturers exporting to the EU or intend to: Failure to prepare for the regulations could result in loss of market access, fines, or even prosecution. Your products will face stricter comparisons on sustainability and circularity, which could impact your market share positively or negatively. Even if your business doesn’t currently export to the EU, the trends set by the ESPR are likely to influence regulations and purchasing decisions in other markets. As supply chains globalise, multinational corporations may enforce ESPR-style standards on all their suppliers, no matter where they are located. With more sustainability and […]

Ceto-Boost Prototype with Cetogenix engineer George Estcourt

Cetogenix: Building renewable futures — with no waste left behind

Each year, the world produces more than 100 billion tonnes of carbon-rich waste from food production, agriculture, sewage treatment and industrial manufacturing. Cleantech startup Cetogenix, a 2024 KiwiNet Research Commercialisation Awards finalist, has found a way to harness the untapped potential of organic waste to generate renewable energy and other circular economy products. The company’s Ceto-Boost™ system breaks down organic wastes and transforms them into valuable products like biomethane, fertilizers and biomaterials. Their patented process uses hydrothermal oxidation — leveraging temperature, pressure and air without any additional chemicals — to deconstruct waste with remarkable efficiency. This novel approach reduces organic waste volumes by 95% and eliminates contaminants like microplastics and pathogens. Globally, it’s estimated Ceto-Boost™ could replace up to 12% of fossil natural gas production and cut greenhouse gas emissions by 884 million tonnes of CO2e annually. The foundation of this innovation lies in over a decade of science and engineering research while the Cetogenix co-founders were working at Scion. They formed Cetogenix in July 2022 via a successful NZ$4.8 M capital raise with co-investment from Pacific Channel Limited, Angel HQ, Enterprise Angels, and Icehouse Ventures. Since launching, Cetogenix has grown to a team of twelve, who complement strong domestic and international R&D and commercialisation relationships. Within one year of founding, Cetogenix scaled up to a prototype Ceto-Boost™ pilot system in Rotorua, where they still maintain a strong collaborative research partnership with Scion. The company is initially focusing on the global municipal wastewater and agricultural biogas markets and has confirmed pilot trials with end-users in New Zealand and the United Kingdom. Maintaining application flexibility and aligning their technology development and intellectual property with evolving market needs has proven crucial for success. With its sustainable waste-to-resource technology, Cetogenix offers a powerful solution to the world’s reliance on fossil carbon — paving the way for […]

Q & A: Frank Phillips, Managing Director, Fulcrum

We have all heard of our ‘productivity problem’. Adopting proven and well understood technology – not the bleeding edge risky stuff – will be key to tackling it. Anyone in manufacturing who has tried to search for technology solutions to solve a particular challenge knows the rabbit hole it can become. The associated lack of confidence in vendors (particularly when there’s no in country support) follows; so it goes in the too hard basket and progress stops. All this in a nation where Number 8 wire pedigree and ‘build it yourself’ solutions start to proliferate. This distracts from core business focus and can be a black hole of investment to develop and maintain. What does Fulcrum do? We save time; give confidence and ultimately help manufacturers get stuff done! Fulcrum connects New Zealand manufacturers to New Zealand technology partners. Part of this is a simple self-service platform, but we also act as your part time CTO, prioritising and advising to make sure the right things get done by the right partners. In New Zealand we have all the skills, knowledge and technology for manufacturing to thrive, but we often don’t do a great job of talking about it! Fulcrum works with manufacturers and primary industries of all sizes. We often find that our on-boarding and follow up sessions allow us to act as an unofficial ‘part time CTO’ – helping manufacturers to prioritise, build the foundations of their digital transformation and work with the right partners to deliver it. We’ve been conscious when onboarding Technology partners that their can be a right size fit to consider. A specialist contractor working independently may be the right fit for one manufacturer in agility and cost, but not right for another where long term support agreements are needed. Digitisation is the way forward? […]

Stop calling workplace safety failures ‘accidents’

By Paul Jarvie, EMA Manager of Employment Relations & Safety With the Government signalling that significant reform of our workplace health and safety regulations are on the way, it’s time to look at the language we use around preventable harms. For too long, ‘accident’ has been a blanket term that absolves responsibility. Whether at home, on the road, or in our workplaces, we’ve grown accustomed to shrugging off incidents as ‘accidents’. But are they truly random acts beyond our control, or is there more to the story? When we label something an ‘accident’, we imply innocence and inevitability. It’s a linguistic shrug that suggests nothing could have been done differently. But the reality, backed by extensive research, paints a different picture. Insurance companies that provide cover for ‘accidental damage’ base their premiums entirely on historical data of such events. They know these events will happen, how many, when and how. The premium setting process uses vast databases to ensure the number of claims do not exceed their premium income – that’s how they remain in business. It’s a similar system to ACC for injury claims. In 2023, ACC handled nearly 200,000 workplace claims, with many stemming from repeat incidents that were likely to have been identified in companies’ hazard registers. As such, they were neither unknown nor unforeseen. This data underscores the need for a more nuanced approach in our safety lexicon. In workplaces, terms like ‘incident’ or ‘near miss’ are often used interchangeably with ‘accident’. Yet, these terms don’t adequately capture the essence of what really happened: a failure in systems, procedures or human judgement that resulted in harm or damage. Take aviation, where research from the Pilot Institute found that pilot error accounted for 69.1% of plane crashes, with 17.2% due to mechanical issues and 13% of unknown […]

Reducing manufacturing emissions

Hon Andrew Bayly, Minister of Manufacturing Manufacturing is a significant sector for New Zealand. It employs 230,000 people and accounts for nearly 10 per cent of GDP and 60 per cent of exports. I often describe it as a “sleeping giant” for New Zealand’s economy, because its significance is not well understood. When I travel around the country promoting the manufacturing sector, one of the things I often remind people is that a career in manufacturing is a career in a highly advanced, technical field. A lesser-known fact is that approximately a quarter of all New Zealand’s business-led research and development comes from the manufacturing sector, meaning manufacturing is a key driver of innovation. However, to support this innovation, manufacturers need the right tools and resources. I know from talking to manufacturers that access to information and expert guidance on how to upskill and improve productivity is challenging. Which is why I was delighted to recently launch a set of tools to help empower manufacturers to grow their business and reduce their emissions. Emissions and waste mapping The first is a report that identifies and maps the manufacturing sector’s emissions and waste patterns. Titled ‘Mapping Emissions and Waste Stream Profiles, and Opportunities for Achieving Net-Zero Circular Advanced Manufacturing’, the report is based on waste and emissions data from 2019 (the most recent data available). It provides a comprehensive picture of waste, emissions, and opportunities to improve sustainability across the seven main manufacturing subsectors: food and beverage, machinery and equipment, other manufacturing, metal and metal products, chemicals and refining, wood and paper, and plastics and rubber. The report details challenges and opportunities for the sector with a goal of helping manufacturers identify opportunities to adopt low-emissions technology and increase circular manufacturing practices which, in turn, will help us reduce our […]

Nature is in the business news

From: August issue NZ Manufacturer www.nzmanufacturer.co.nz With good reason. In the next few years, New Zealand manufacturers can expect to be called on to answer these two questions. How is your business reducing your impacts on nature? How will changes to nature affect your business? Who’ll be asking these questions? Governments, regulators and financiers like lenders. They’re realising that centuries of degrading nature (the ecosystems that make up land, oceans, freshwater and the atmosphere) is not only depleting biodiversity. It’s having financial and economic impacts on businesses too. These parties are adding weight to environmentalists’ calls for urgent change. In this article we explain what this means for manufacturers in Aotearoa New Zealand. The need for change The World Economic Forum’s 2024 Global Risks Report ranks dwindling biodiversity and collapsing ecosystems among the five most severe risks to business in the next ten years. The UK Green Finance Institute’s recent report makes sobering reading. It identifies and measures the country’s nature-related risks. The report confirms that these risks are as harmful as the risks of climate change, and that nature and climate are linked. Zoonotic diseases, declining soil health, slips, floods, food insecurity and lost production will affect all sectors – including manufacturing. The economic impacts could be worse than the Global Financial Crisis or Covid-19. The report concludes that the UK must transition its economy urgently to valuing and investing in the environment. As 50 percent of the country’s risks come from overseas (including New Zealand), UK regulators and financial institutions will require businesses to scrutinise their supply chains. We expect other trading partners, including the EU, to take a similar stance. Nature Positive, the global goal for nature The world has agreed a biodiversity equivalent for the global goal that limits global warming. Nature Positive is made up […]

Ten tips to make your business case for sustainability stack up

This information is based on a guide we wrote with the Sustainable Business Council and Kaitiaki Collective. It’s a situation we know many manufacturers face. You want to make your business more sustainable. (Bravo!) You can see the many benefits of manufacturing products that reuse resources, avoid modern slavery and create fewer environmental impacts. But – here’s the kicker – you’re struggling to get the business case for making these changes ‘over the line’ with your accountant or finance team. These ten tips will help you. Tip 1. See becoming more sustainable as an investment Sustainable businesses are excellent businesses. They create value in the short and long terms – economically, environmentally and socially. Treat your sustainability programme as an investment and manage it as one. Tip 2. Identify your stakeholders Consider the many people who have a ‘stake’ in your business succeeding sustainably. You will naturally think of your investors, customers, suppliers, team, local community and regulators. Think longer term and wider too. Include the environment and people who will live many years in the future. Tip 3. Confirm where to focus with a materiality assessment Your business case needs to reflect the views of all these stakeholders and your business too. Start with a ‘materiality assessment’. It’s a practical way, using interviews and surveys, to home in on the sustainability activities that your stakeholders and business care about and to prioritise the ones that matter most. A materiality assessment takes a broad view of sustainability and covers environmental, social and economic topics. Include your top priority topics in your business case. Tip 4. Understand who you need to convince Who do you need to influence to get your business case over the line? What are they interested in? What are they concerned about? Who else has their ear? […]

Leadership Development – showing the real return on investment

NZ Manufacturer July 2024 by Media Hawkes Bay Limited – Issuu David O’Connor, Commercial Manager, The Learning Wave While it is a comparatively easy exercise for businesses to show the Return on Investment on additional plant or machinery, being able to crunch the numbers of the real impact of leadership development training has traditionally been seen as more subjective, and made even harder when faced with the current headwinds of tight economic conditions. Businesses that continued to prioritise investment in their people during the earlier 2020s are now repeating the rewards of increased leadership bench strength, higher levels of staff engagement, and little or no employee churn. And many of our clients can now confidently calculate the return on their training investment. Much was made of the ‘Great Resignation’ during 2020 and the impact this would have on businesses losing their best talent, we all know businesses that stopped leadership development training while others doubled down on their investment to upskill their leaders. It is interesting that the commentary around the great resignation disappeared from HR and business reporting without much noise at all, and has been replaced with plenty of articles on the VUCA era – a trendy managerial acronym short for volatility, uncertainty, complexity, and ambiguity. In this VUCA era, it is reported that businesses need leaders – at all levels – with strong resilience, who can actively engage a wide and diverse group of staff, manage multiple projects and demands, and have a curious mindset to be able to lead their teams through constant change. So it is the businesses that continue to invest in their people leaders who will be reaping the rewards in the VUCA era, and being able to not only retain their top talent but also have a bench of talented leaders ready […]

The scope 3 ripple effect

-Insa Errey In the ever-evolving landscape of regulations, New Zealand manufactures find themselves connected to the regulatory frameworks of key trading partners such as the European Union (EU). The EU has positioned itself as a global leader in climate action, with ambitious targets set under the European Green Deal and the European Climate Law. As part of its efforts to reduce greenhouse gas emissions, the EU has implemented regulations on Scope 3 emissions reporting through directives such as the Non-Financial Reporting Directive (NFRD) and the EU Taxonomy Regulation. Understanding the impacts of Scope 3 regulations in these markets is crucial for New Zealand manufacturing. Let’s delve into how regulations in the EU can shape the strategies and operations of New Zealand manufacturers. First, what is Scope 3? Scope 3 emissions refer to indirect greenhouse gas emissions that occur in the value chain of a company, including both upstream and downstream activities. These emissions often result from activities such as the production of purchased goods and services, transportation and distribution, and waste disposal. For any EU customer this may just be your manufacturing sites Scope 1 or 2 emissions. Meaning the emissions your site emits from use of direct combustion (scope 1) or indirect emissions on site from purchased electricity (scope 2). What does this mean for NZ manufacturers? Market Access and compliance pressure to adhere to these standards is required for exporting to the EU which governs Scope 3 emissions disclosure and reduction. Failure to meet these requirements can result in barriers to market entry. In a global market increasingly, prioritising emissions reduction is becoming an advantage, as exporters can face competition from countries with lower carbon footprints. Failure to manage or measure emissions can put NZ manufacturers at a competitive disadvantage and could impact market share. Even if you […]

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