Stopping the WEEE Chain Reaction

by Graham Davy, Sims Recycling Solutions

Reverse Logistics Magazine, May/June 2008

Much has been said in the media about how the high price of metal is driving a rise in scrap metal thefts across the UK – something the British Transport Police has been quoted as saying is the second biggest problem in the UK after terrorism. Now this issue seems to be moving into the Waste Electrical and Electronic Equipment (WEEE) marketplace, with organisations that operate in the more established European WEEE obligated countries seeing valuable materials being removed from the waste stream.

Here, we examine the missing WEEE problem and the trouble the removal of WEEE from the supply chain can cause further down the line for logistics companies, their recycling partners and client organisations with material to recycle.

Leakage from waste streams is not new. It is something that nearly all waste-based reverse logistics operations will have experienced over the years—waste with a perceived value being removed before it is processed, either for personal use or to be sold on. As a company operating across Europe, we have started to notice first-hand that this problem is growing with, in this case, a rise in valuable WEEE being removed from the waste stream.

This isn’t as a result of the cherry picking we are used to but rather a large scale, concerted effort by traders and illegal operators to cash in on high prices for materials such as metals. In the Netherlands for example, we are seeing outsiders approaching staff at waste collection centres, asking them to remove high-value items such as computer central processing units (CPUs), servers and cables prior to collection or treatment in return for cash.

Once this untreated waste is removed from the chain, a lot of it gets shipped out of the EU to countries that do not have the same stringent waste regulation, such as the Far East and African nations. Indeed, it is estimated that 500 containers arrive in Nigeria each month with waste electrical materials. Around half of those containers come from the EU carrying brown waste from virtually every well known brand and two thirds of the imported computer equipment which arrives in the country is no better than junk. This practice isn’t just happening in the Netherlands, we see evidence of similar situations in other countries including Belgium and Germany—and we expect cases in the UK to come to light in the very near future.

Looking after the assets

To some, the removal of old electronic equipment such as computers and servers is not a big problem, but the theft of untreated WEEE brings with it a number of serious problems—especially in relation to the disposal of B2B electronic assets and waste. While there is an intrinsic value to WEEE in relation to the materials that can be extracted from the waste equipment, for B2B companies the true value for the end of life machinery is much higher due the often sensitive and confidential information held on the equipment or indeed the intrinsic value left in the equipment as a reusable item.

As the business world continues to move to digital formats and more confidential information is held electronically, then ensuring data security when equipment is discarded will become the number one concern for many disposing organisations. Therefore, the end-of-life equipment should still be viewed as assets and treated as such. Indeed, recent research has shown that the majority of equipment discarded by the B2B market has gone through no internal data purge and that many organisations are unaware of the problems that can be caused by the disposal of equipment still containing sensitive information. Therefore, when it comes to the discarding of items such as computer hard drives or servers, secure disposal has to be just that - secure.

Over the last year the effects of the loss of sensitive data have been widely publicised. Furthermore, there are many examples of the unauthorised disclosure or loss of data as a result of inadequate procedures within the disposal process. In such cases, the implications for all involved in the recycling process could be extremely serious. WEEE being stolen from the supply chain before it reaches the recycling partner at the end could lead to the personal details of third parties such as customers and staff falling into the wrong hands, creating an opportunity for identity fraud to be committed.

Should the stolen waste hold sensitive information and subsequently, used to commit fraud, or be found in the wrong hands, then the disposing organisation, the logistics company or the recycling partner could come under the media spotlight and their brand integrity could be compromised. Furthermore, if the information contained on the stolen WEEE is commercially sensitive, then it could cause the disposing organisation to lose market share, potential investors—and paint it in a bad light in front of its industry or sector peers.

It should also be noted that failure to keep such information safe will mean that those in the WEEE supply chain could be breaking a number of laws and legislation, including the data protection laws and official secrets legislation, as well as infringing intellectual property rights and confidentiality agreements. Therefore, it is important that disposing organisations work with a supply chain that can offer a secure solution for the disposal of its sensitive waste.

So how can all parties in the reverse logistics chain work together to minimise the threat of missing assets, information or WEEE? For the organisation disposing of its waste, one way is to reduce the number of ‘hands’ in the process by cutting out the middlemen and working directly with the recycling partner at the end of the chain.

Cutting out the middle men

Due to the nature of the way material is collected and transported via some compliance schemes, the WEEE passes through a number of different parties before reaching the recycler. This provides a much greater opportunity for WEEE that looks like it might have some value to be being removed from the system.

By working directly with the party at the end of the chain and its retained logistics partner, the likelihood of this is reduced greatly as the waste is only exposed to those companies and is transported securely to the end destination. Also, by working with a recycling partner, the client is able to meet the company overseeing the treatment of their WEEE and can be present when this material is being recycled—giving peace of mind that the equipment has been disposed of correctly.

Those organisations with equipment to dispose of also need to consider the services on offer and if they conform to government standards. In general, sensitive data can be removed in one of two ways. This can be done by electronic means, data-wiping the disk using specialist, high-strength software, thereby making the hard drive available for re-use, extending the life-span of the equipment and perhaps reducing IT costs.

The other option is to physically destroy the disk and thus the data, but eliminating the potential for re-use. There are a number of ways of doing this including the use of acid baths but the most popular method is via shredding which breaks the hard drive down into pieces six millimetres or smaller. This will ensure that the disk and the information will be rendered useless. In certain highly sensitive cases both the software option and physical destruction option are used.

Planning is the key

3PL can help combat the removal of electronic equipment from the supply chain by tightening up on their own processes—and this begins before logistics firms come into contact with the waste, with security being a prime consideration. This should cover the whole of the reverse logistics chain, including looking at the vehicles being used to transport the waste to ensure they are secure enough to do so. For example trucks, with an open top or flexible side panels may not be the best option when looking to ensure the security of the WEEE cargo.

Clear and easy reporting procedures should be established for staff to highlight approaches encountered from outsiders asking them to remove WEEE from the waste stream. Such procedures will show staff the serious nature of the problem, while improving security right along the logistics chain. Hiring the right staff is also key—Sims waste collections, for example, are undertaken by staff that has undergone security checks.

Route planning is another area that should be considered by those involved in the transportation of WEEE. By reducing the number of stops or pick-ups made on each journey, it will limit the number of people or places that the waste comes into contact, reducing the risk. Wherever possible, journeys should be made in one day, avoiding situations like overnight stops where the waste may be left unguarded in places such as service stations or lay-bys. Un-scheduled stops by drivers should be discouraged, within the transport laws and regulations, to reduce the opportunity for the extraction of valuable waste.

Route planning is another area that should be considered by those involved in the transportation of electronic equipment. By reducing the number of stops or pick-ups made on each journey, it will limit the number of people or places that the redundant equipment comes into contact, thus reducing the risk. Wherever possible, journeys should be made in one day, avoiding situations like overnight stops where the waste may be left unguarded in places such as service stations or lay-bys. Un-scheduled stops by drivers should be discouraged, within the transport laws and regulations, to reduce the opportunity for the extraction of valuable waste. The varying of routes should also be encouraged as part of the planning stage, with a number of route options available.

Should waste be left at a centralised depot for future collection then the security of the facility or site will need to be considered. 3PL companies need to give careful thought to where the waste will be stored. Other considerations include whether the waste will be locked away or if it be in a place that is easily accessed, or in an area with high footfall.

The removal and transfer stage when using a central depot or facility is another facet of the process that needs careful consideration and monitoring. The option is often cheaper and subsequently desirable but this should be balanced against security requirements. As the waste will be removed from the vehicle and moved around, it will come into contacts with extra hands and as such, the risk of extraction is higher.

Finally, on collecting the waste it is imperative that a full inventory is taken of each item and the quantity should be recorded—this record-taking process is key. This should then be tallied against the records of the disposing organisation before the consignment leaves their premises and any irregularities ironed out before transportation.

Pulling together

It is important to note that those organisations involved in the WEEE supply chain cannot do it all by themselves. We need stronger and swifter direction from central government, both in the UK and at the European Union level. There is a lack of focus upon enforcement. The powers that be need to act strongly to put an end to illegal local practices and exports—ensuring that all countries involved in the WEEE Directive are enforcing the rules in a pan-European, consistent manner.

Obligated countries need to be putting the same level of resource and manpower into policing the directive, ensuring that waste cannot be stolen and moved across borders, something that is not happening at present. For example, one EU member has only dedicated 200 man-hours per year to enforcing the rules on the export of illegal WEEE, which is woefully low.

Experience also shows us that each country has its own domestic responsibilities and enforcement schemes and this just adds to the confusion, as each country will have its own interpretation of the ruling. Understanding of the seriousness of this issue is currently low and due to this, internal communication and co-operation processes still need to be improved amongst the many different bodies domestically. In many countries, such as the UK, the detection and enforcement role is handled by a number of Government agencies such as the police, customs and port authorities. If the communication process and resources between these parties isn’t what it should be then the loopholes will gradually grow and failings will appear, making it easier for the illegal operators to work illegally. By tightening controls and having stronger punishment for illegal operators—it narrows the field of play for those operating outside of the rules and reduces the opportunity for illegal operators to cash in.

As both businesses and consumers continue to adapt their processes and lifestyles to become more environmental, then the volume of WEEE will grow dramatically, making the problem of missing WEEE more prevalent. Therefore, it is now the ideal time for all those organisations involved in the WEEE reverse logistic chain to realise what is happening and put in place controls to ensure the material does not leak from the WEEE chain.

“By deploying stricter monitoring systems, reducing the number of people involved in the supply chain and educating 3PL staff about the dangers of untreated waste being removed from the chain, then the threat can be stamped out before it becomes an even bigger problem.

While this may seem like a negative topic for 3PL organisations to be highlighting, it offers the industry and other organisations involved in the waste supply chain a positive opportunity. By educating clients and partners, it will demonstrate that the industry is taking the threat seriously, placing logistics organisations as leaders and experts while also showing those disposing organisations at the start of the chain that their reputation is valued. Such activity will also act as a show of strength to those outside forces that are involved in the theft of WEEE that the practice will not be tolerated.”

Graham Davy is Global Chief Executive of Sims Recycling Solutions, a division of the Sims Group. Sims is the world’s largest listed metal recycler with over 200 operations globally. For further information on Sims, its operations and its services