Ch 4: Sustainability Flashcards
sustainability
taking only what is needed and leaving behind enough for future generations
triple bottom line
profit (economic), people (social), planet (environmental)
firms need to capture _____ _____ of _____ to minimize harm resulting from their activities
whole sets of values
3 reasons for incorporating sustainability into corporate strategy
- sustainability requires innovation and entrepreneurship –> competitive adv, lower costs, etc.
- ignore sustainability –> negativity from society (Iron Law)
- it’s the right thing to do
the Sustainability Imperative
driven by large-scale initiatives like the UN Global Compact → 17 Sustainable Development Goals (SDGs)
competition for resources
demand is growing more quickly than can be replaced
climate change as a major sustainability issue in business
business must be prepared to respond to new policies regarding emissions and to take advantage of new technology
economic globalization as a major sustainability issue in business
wide disparities in social/environmental standards bring both risks and opportunities
ex. if you outlaw child labor, a family may lose a member bringing in part of the family income (14 yr old in the mine example)
externalities – definition and examples
negative consequences
ex. forestry firms, pollution, processing raw materials
any environmental effort from business usually comes from…
compliance or efficiency
4 waves of environmentalism
- 1700s-1800s – environmental laws intended to promote settlement/grow economy
- 18-early 1900s – laws aimed at mitigating issues w/ western expansion
- 1900s – laws triggered by awareness of environmental priorities (ex. philly river dirty, soot in cities)
- today – sustainable development & circular economy (reusing items)
________ ________ _________, a subset of CSR, has evolved over decades to become institutionalized in business practice.
ex. Patagonia – UN Champions of the Earth, outdoor wear made out of discarded plastic bottles
corporate environmental responsibility
Coca-Cola – “We have a responsibility to respect and protect water resources”
Atl had a water shortage some time ago and due to a combination of stakeholder pressure and the companies choice to do the “ethical”/right thing, they decided to lessen water usage close to zero.
wicked problems
“wicked” = resistance to a resolution, rather than evil
these problems include environmental issues
tragedy of the commons
no one takes responsibility and in absence of constraints, self-interest is likely to lead people to behave in ways that will not sustain shared resources
Integrating Sustainability into a Firm’s Philosophy is a natural extension of ________ _____, including as a stakeholder in the ecological system from which the firm obtains resources and to which it bears responsibility for its impacts, positive or negative
stakeholder theory
Environmental Protection Agency, EPA 1970
independent agency to research pollution problems, aid state/local govt, administer federal laws
