Management Systems and 3rd Party Registration

Wondering if there is value in your safety, quality or environmental management system?  Wondering if there are any research or case studies out there which you can read to help determine if a Standards-based management system and/or registration of that system might be right for your business? Don't just take our word for it. And don't let those with no practical experience with the registration process help guide your decisions. We’ve done a little research and came up with a significant number of studies which support and validate the value of HSEQ management systems, as well as the value of accredited certification. Here are some findings if you were wondering if management systems and standards have any value. You might find them useful in their development of your business case for your HSEQ management system certification effort.

The Value of Accredited Certification

http://www.anab.org/resources/value.aspx

The ANAB has a number of interesting links and references which readers will find of interest for any registration process you may be interested in.

Studies That Demonstrate the Benefits of Certification

There are just some of the studies we found validating the ISO registration and management system process.

1. Evaluating outcomes from ISO 9000-certified quality systems of Hong Kong constructors by Dissanayaka, Kumaraswamy, Karim & Marosszeky: “Based on the literature reviewed and the sample surveyed in Hong Kong, it is observed that the majority of ISO 9000-certifed constructors are in general agreement as to the net benefits, as well as on many of the positive and negative outcomes that may emerge from the implementation of the ISO 9000-certifed quality systems”.

2. C.J. Corbett, et al., 2002. Does ISO certification pay? ISO Management Systems, Special Report, 31-40: “Certification appears to lead to improved financial performance measured by return on assets. Firms that failed to seek certification experienced substantial deteriorations in return on assets, productivity, and sales, while firms that sought certification generally managed to avoid such declines. Firms that received certification did not, on average, see their absolute performance improve, but did see their relative performance improve substantially, compared to their uncertified peers”.

3. C.J. Corbett, et al., 2005. The financial impact of ISO 9000 certification in the US: an empirical analysis. Management Science, 51(7): 1046-1059: “After deciding to seek their first ISO 9000 certification, publicly traded U.S. manufacturing firms experienced significant abnormal improvements in financial performance. Careful design and implementation of consistent and documented quality management systems can contribute significantly to superior financial performance”.

4. Harvard Business School. Quality Management and Job Quality: How the ISO 9001 Standard for Quality Management Systems Affects Employees and Employers by David I. Levine Michael W. Toffel: “Our finding that ISO 9001 certification benefits employers bolsters prior research on ISO 9001 (e.g., Corbett et al. 2005; Terlaak and King 2006). Our results are particularly credible because we analyze a larger sample of ISO certifications than almost any previous study, have performance data at the workplace level (unlike many previous studies that examine how ISO certification at a single plant affects the financial performance of a multi-plant organization), measure performance using third-party (rather than self-reported) data, use a panel dataset that enables us to measure performance over time, and develop carefully matched sets of non-adopters”.

5. The Effects of ISO Certification on Organization Workmanship Performance by Iwaro Mwasha: “Based on the hypotheses tested, this study concluded there was a direct correlation among ISO certification, organization workmanship performance, and improvement in workmanship factors, which was very substantial. Also, the study concluded that the correlation between workmanship performance and improvement of workmanship factors was influenced by ISO certification application”.

6. Resolving Information Asymmetries in Markets: The Role of Certified Management Programs. By  Toffel of Harvard Business School: “After becoming certified to ISO 14001, I found evidence that adopters subsequently improved their environmental performance more than a similar set of non-adopters did, across each of the four of the performance metrics I examined: facility-wide pounds of toxic emissions, facility-wide health hazard, pollution intensity in terms of pounds of toxic emissions, and pollution intensity in terms of health hazard. Taken as a whole, these results demonstrate that a voluntary management program with a robust verification mechanism can indeed distinguish organizations based on their difficult-to-observe management practices”.

7. A.  King, et al., 2005. The strategic use of decentralized institutions: exploring certification with the ISO 14001 management standard. Academy of Management Journal,  48(6): 1091-1106.“Certification provides credible information about hard-to-observe organizational attributes; in particular, certification reveals the existence of an underlying management system and such systems are associated with performance improvement”.

8. A. Terlaak and A.A. King, 2006. The effect of certification with the ISO 9000 quality management standard: a signaling approach. Journal of Economic Behavior and Organization, 60(4): 579-602: “Facilities certified to ISO 900 experience a greater increase in production volume subsequent to certification than non-certified facilities, and the effect increases with the size of the industry to which the certified facility belongs. Certification allows buyers to identify suppliers with better quality attributes, which, in turn, triggers certified facilities to expand their production”.

9. Nicole Darnall, 2006. Why firms mandate ISO 14001 certification. Business & Society, 45(3), 354-381: “Firms that mandate ISO 14001 endure greater external pressures and have stronger complementary resources and capabilities that support their organization-wide ISO 14001 policies”.

10. Bansal and T. Hunter, 2003. Strategic explanations for the early adoption of ISO 14001. Journal of Business Ethics, 46: 289-299: “Organizations certified to ISO 14001 may be able to enhance their environmental image and confer external legitimacy”.

11. C. Coglianese and J. Nash, eds., 2001. Regulating from the Inside: Can Environmental Management Systems Achieve Policy Goals? Washington, DC: Resources for the Future: “Organizations that certify to ISO 14001 may be able to use ISO 14001 to increase their internal efficiencies and create competitive advantage opportunities and economic benefits. Companies that reduce their environmental impacts below legal reporting thresholds may no longer be subject to costly regulatory mandates”.

12.  N. Darnall and D. Edwards Jr., 2006. Predicting the cost of environmental management system adoption: the role of capabilities, resources, and ownership structure. Strategic Management Journal, 27: 301-320: “Strategic benefits may accrue to ISO 14001-certified companies in that certification requires that firms routinely scrutinize their internal operations, engage employees in environmental issues, continually monitor their progress, and increase their knowledge about their operations”.

13.  K. Kollman and A. Prakash, 2001. Green by choice? Cross-national variations in firms' responses to EMS-based environmental regimes. World Politics, 53: 399-430: “The enhanced image and legitimacy that can accrue from ISO 14001 certification could lead to increased sales, improved ability to recruit talented employees, and enhanced relations with external stakeholders”.

14.  M. Casadesús et al., 2001. Benefits of ISO 9000 implementation in Spanish industry. European Business Review, 3(6): 327-335: “Basque companies report substantial operational and financial benefits from certification”.