Chapter 12: Sustainability Flashcards
Define Sustainable development?
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Sustainable development: “development that meets the needs of the present without comprising the ability of future generations to meet their own needs”
○ As a long-term approach to balancing the needs of people while growing the economy and preserving the environment- The economy depends on the talents of people, and the resources from the earth for development and growth
What are the three components to development?
○ Development (to progress the economy and society)
○ Sustainability (to sustain resources)
○ People (current and future generations)
Define The framework for the Triple Bottom Line approach (TBL) and the definition
- Sustainability involves the relationship between the three Ps: (main ones)
○ People
○ Profits
○ Planet - Also known as the three Es:
○ Equity
○ Economy
○ Environment
Became the dominant framework for business reporting social and environmental performance with traditional finanical/economic results
*Purpose: contributes to the overall environmental health, social well-being, and a just economy
Triple Bottom Line: What is the Economic Factors?
- Changes the number of employees, size of business, taxes paid, revenue by sector, and research and development costs
○ Provides information affecting the company’s bottom line and cash flow - TBL reporting acknowledges that for a business to be sustainable, a company needs to be equitable to its employees and respectful to the environment
Triple Bottom Line: What is the Social Factors? Define Social equity and Climate Change
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Social equity: refers to fair and equitable business practices toward employees and the community
○ Examples: fair salaries, respect for diversity and human rights, safe workplace, reasonable working hours, and adherence to all employment laws
○ Companies that outsource their products overseas, not using child labour, harmful working conditions, etc.
§ Business ethics plays a role in social equity
□ Ex. Boohoo was paying their employees in Leicester below minimum wage - A company’s commitment to helping communities it operates in
○ Charitable donations, volunteer time - Climate change: change in climate caused by significant alternation of weather patterns
○ In order for industries to be sustainable, they both address the needs of their suppliers and the environment
Triple Bottom Line: What are the Environmental Factors? Talk about the depletion of Natural resources and what Improvements can be made?
- The need for sustainable practices to protect our water, land, and air
Two key concerns: depletion of resources and release of greenhouse gases
Depletion of Natural Resources
* Water
○ Water shortages are due to population growth, pollution, and poor infrastructure
○ Worldwide agriculture accounts for 75% of water consumption
○ Need for Virtual water: is water necessary to produce, process, and transport products of consumption
§ Ex. A regular size cup of java requires 34 gallons of water
§ In the 21st century water will be the new gold
* * *Raw Materials
○ Average American consumers about five more times stuff than 100 years ago
○ Western industrial nations have been the biggest consumers of natural resources
Greenhouse Gas (GHG) Emissions
○ Greenhouse gas emissions: arise when fossil fuels are burned to make electricity, to heat homes, process industrial activities, power transportation, allow agricultural processes
○ Fossil fuels: is a non-renewable resources that takes millions of years to form, the burning of fossil fuels creates carbon dioxide (CO2) to be released into the atmosphere
○ Carbon footprint: measures the total amount of greenhouse emissions from a person, product, event, or organization
What are the benefits of the TBL Framework?
(3 Points)
Benefits of the TBL Approach
1. Improves transparency
○ Allows an organization to report on its impact on society and the environment
§ Exposes itself to the public and it’s criticism or praise
2. Allows flexibility
○ Any size or any industry can use the TBL method
§ Any organization can use it to assess performance and make necessary changes
3. Aims to satisfy more stakeholder
○ Can improve the impact on the people that are affected by the organization
Limitations of the TBL Approach
- No measurement standards
○ There is no widely accepted standards for measuring, verifying TBL data
○ Economic category could use a monetary value, while social and environmental are hard to measure - Too subjective
○ Ex. The social category requires personal judgment, the needs of stakeholders can depend on region, culture, values, etc. - Lack of comparability
○ The TBL approach is not legally required
○ Each organization that does follow it, can selectively choose what data to collect
No consequence if they’re missing data
What is the greatest source of Greenhouse gas?
Electricty and Heat with 30.4%
What are the four ways to measure Sustainability?
- Living Planet Index
- Ecological Footprint
- Index of Sustainable Economic Welfare
- Green Growth Index
Measuring Sustainability: Define the Living Plant Index, Biological Diversity, and Ecosystems
- Living Plant Index (LPI): aims to measure changes to the world’s biological diversity based on the populations of species around the world
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Biological diversity: refers to the different forms of life and the number of species on earth
○ Ex. Animals, plants, bacteria, and other living organisms - LPI states there has been a 60% decline in biodiversity since 1970
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Ecosystems: a set of complex relationships among living organisms, and their environment
○ If one part of the ecosystem is damaged, it affects the rest of the parts
Measuring Sustainability: Define The Index of Sustainable Economic Welfare
**Index of Sustainable Economic Welfare **(ISEW): focuses on the welfare of the country
* Attempts the measure both positive and negative activities that affect a society’s well-being
* Goes beyond measure of GDP
○ Ex. + free childcare costs but - water pollution
Measuring Sustainability: Define Green Growth Index identify the four green growth points
Green Growth Index (GGI): tool to evaluate the effects of a country’s green growth policy implementation
* Allows countries to assess a country’s green policies and their performance overtime and compare to other countries
* Four green growth points:
○ Efficient and sustainable resources use - involves more efficient use of the country’s natural resources
○ Natural capital protection - parts of the ecosystem that inhabitants use to generate goods and services Ex. Clean air, pollution, fertile soil
○ Green economic opportunities - outlines the importance of natural capital in achieving new growth sources and increasing economic opportunities Ex. Green investments and jobs
○ Social inclusion - allows for the inhabitants’ involvement in sustaining opportunities; ensures that the entire population reaps the benefits of economic growth
What are the reasons for implementing sustainable practices?
Reducing Costs
* By reducing packaging, lowering energy use, and reducing waste
*Reducing Packaging *
* Many companies are revaluating their packaging to reduce money and waste
○ By using reusable containers and utensils
*Lowering Energy Use *
* Green building designs lower energy costs and increase market value for building owners
Reducing Waste
* Construction industry takes up 25-45% of all waste in North America
○ That waste can be reused or recycled
Reducing Risk
* Businesses can reduce operational risk by improving health and safety programs to protect the environment
* When businesses create sustainable practices, governments might create new laws based on that
* - ex. Avoid Oil Spills
Improving Public Relations
* Good public relations are achieved through good quality products, excellent customer service, and helping local communities
○ Ex. Nike was exposed for their poor labour practices abroad
§ Customers protests were ensued, sales declined, and staff were laid off
What are the obstacles to becoming more sustainable?
Time
* Businesses hire minimal amount of people to save costs only to focus on core activities
* They have “lack of time” to focus on other things
Money
* Having sustainable practices may require businesses to commit upfront costs
* Businesses may not be able to afford renewable sources of energy
Lack of Knowledge
* Every industry has its own way of dealing with sustainable issues
* Managers may not understand corporate social responsibility and environmental issues as it wasn’t a part of their education
