Leadership, Corporate Social Responsibility and Sustainability, Part 5: Sustainability

 

Just like the broader term of corporate social responsibility, sustainability also carries multiple meanings to different audiences. Inevitably, groups and organizations that are interested in specific issues related to the environment tend to define the issue in narrow  terms. It is helpful to understand the term in its most general sense, which often involves some sense of marrying commercial needs  with preserving the natural environment for the future. Several  definitions can help. The 1986 World Commission on Environment and Development (Brundt­ land Commission) definition of sustainable development could reasonably be applied to sustainable business practices: “development that meets the needs of  the present without compromising the ability of future generations to meet their own needs.” A simple but powerful expression is that of Robert Gillman: “do unto  future generations  as you would  have them  do unto you.”

Several  definitions can help. The1986 World Commission on Environment and Development (Brundt­ land Commission) definition of sustainable development could reasonably be applied to sustainable business practices: “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”  A simple but powerful expression is that of Robert Gillman: “do unto  future generations  as you would  have them do unto you.”

Growing  population, increased urbanization and industrialization  around the world, and dramatic increases in production and consumption all have a sig­nificant impact upon the environment. The result has led to increased pressures from nongovernmental organizations and multilateral institutions to create greater awareness and to improve practices by governments, businesses, and individuals to lessen the detrimental impact. This involvement sometimes raises political and philosophical disagreements in regard to  the extent of problems and the nature of the proposed solutions. An example of this is the 1997 Kyoto Protocol, an international agreement linked to the United Nations Framework Convention on Climate Change. This agreement sets binding targets for industrialized countries and the European Community for reducing national  levels of greenhouse gas emissions. The United States declined to join this agreement because it excludes major developing economies like China, India, and Brazil, which are also major greenhouse gas emitters.

Controversy continues over whether these greenhouse gases  are causing  climate change or global warming. Within individual nations,  political disagree­ments over the wisdom and necessity of “green” policies and practices often show varying opinions about whether “green is good.” For example, the EU announced a carbon emissions tax on all airlines flying  into Europe. This ruling has raised protests from the U.S., Indian, Russian, and  Chinese governments and those of other countries as well. In another example, U.S. and European regulations that set new standards for the amount of light emitted per watt of power used effectively require the use of compact fluorescent bulbs and make incandescent light bulbs obsolete. Subsequently, concerns have emerged about mercury content in the new bulbs and how to dispose of them, as well as whether they are as effective in illumination. As a result, some people are hoard­ing old lightbulbs. Similar issues and a secondary market in old toilets have resulted  from regulations  on  low-flow  toilets  to save water.

International marketers will need to pay attention to multiple regulations governing the environmental impact of products. The EU has implemented REACH (Registration, Evaluation, Authorization, and Restriction of Chemical substances), a set of broad-reaching regulations on the use of chemicals, to motivate businesses to exclude dangerous chemicals like cadmium  in products  such as personal computers and cell phones.

Where problems exist, business opportunities may exist as well. As we have outlined in this chapter, companies like  IBM,  GE, and  Siemens are  adjusting their corporate strategies and their product offerings to address some of the planet’s environmental challenges and governmental plans to tackle them. In President Obama’s 2011 State of the Union address, he called for the United States to generate 80 percent of its electricity from clean energy sources by 2035. Depending upon the evolving definition of “clean energy,” this goal may mean good opportunity for companies that have products and services in renew­able energies, nuclear power, efficient natural  gas,  coal  with  carbon  capture and sequestration, wind power, and solar energy. Some businesses objected, contending that the goal was unachievable because of existing regulatory barriers. Business groups and environmental organizations in many countries often clash over various regulations that affect access to energy supplies. Even “clean energy”  can pose  environmental disputes as illustrated by the issues of shale gas drilling and pipelines in the United States and by the movement away from  nuclear  power  in Germany.

18 thoughts on “Leadership, Corporate Social Responsibility and Sustainability, Part 5: Sustainability

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