What is Eco-efficiency?

Eco-efficiency is a management concept that focuses on creating more goods and services while using fewer resources and creating less waste and pollution. It brings together the two essential elements– ecological and economic progress – which are necessary for the holistic prosperity of a nation.

As per the World Business Council for Sustainable Development (WBCSD), “eco-efficiency is achieved by the delivery of competitively priced goods and services that satisfy human needs and bring the quality of life, while progressively reducing ecological impacts and resource intensity throughout the life-cycle to a level at least in line with the Earth’s estimated carrying capacity.”

How does Eco-efficiency work?

Eco-efficiency requires businesses to produce more value from lower inputs of materials and energy and with reduced pollution. It applies throughout a business, right from product development and marketing phase to manufacturing or distribution. The seven major elements for eco-efficiency are:

1. Reduced energy intensity
2. Reduced material intensity
3. Reduced dispersion of toxic substances
4. Enhanced recyclability
5. Maximized use of renewables
6. Extended product life
7. Increased service intensity

What is the Eco-efficiency Ratio?

It is the ratio between the (added) value of what has been produced and the (added) environmental influence of the service or product (e.g., SO2 emissions). It is given by the formula:

Eco-efficiency Ratio = Product or service value/Environmental influence

Eco-efficiency ratios can help express product performance in ways that are more meaningful to their users. Many businesses already use eco-efficiency ratios to express a product’s functional use related to its impact.

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