Business and Environmental Sustainability

Foundations, Challenges and Corporate Functions

Sigrun M. Wagner

• Publisher: Routledge
• Year: 2020
• ISBN:
  9781351803151
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Environmental sustainability is increasingly important to organisations, whether for regulatory, financial or ethical reasons. Business and Environmental Sustainability looks at the environmental aspect of sustainability for all organisations pursuing competitive advantage. The book provides theoretical foundations from science, economics, policy and strategy, introduces three environmental challenges (climate change, pollution and waste) and looks at how corporate functions can address these.

This textbook provides a thorough foundation by introducing readers to the science, reasoning and theory behind environmental sustainability and then delves into how these ideas translate into principles and business models for organisations to use. Next, it covers environmental challenges from climate change, pollution and waste, and then goes on to examine the different corporate functions (from supply chain management to human resources) to illustrate how environmental sustainability is managed and put into practice in organisations. Finally, a set of integrative case studies draws everything together and enables the reader to apply various analytical tools, with the aim of understanding how companies can not only reduce their environmental footprint but can positively contribute to environmental sustainability.

Written by an award-winning lecturer, Business and Environmental Sustainability boasts a wealth of pedagogical features, including examples from a range of industries and countries, plus a companion website with slides, quiz questions and instructor material. This will be a valuable text for students of business, management and environmental sustainability and will also be suitable for broader courses on corporate responsibility and sustainability across environmental studies, political science and engineering.

CHAPTER

1

Introduction

The past and the present

In contemporary society, businesses are increasingly faced with the challenges of addressing sustainability as a result of legislation, stakeholder pressure, financial motivation or a desire to do the right thing. The chapter at hand introduces the book, making the case for environmental sustainability for both businesses and students, and drawing the wider context before providing an overview of the book and suggestions for its uses.

THE CASE FOR A BOOK ON BUSINESS AND ENVIRONMENTAL SUSTAINABILITY

The case for business

Why should business leaders take an interest in environmental sustainability beyond simply the opportunity for efficiencies and cost-savings as well as the ethical imperative? Whilst these considerations indeed play an important part, what cannot be neglected is the opportunity for innovation, for transformation, for resilience and even future survival, in other words, the flourishing of business.

For businesses, unfamiliarity with environmental sustainability could place them at a serious competitive disadvantage, particularly in a business context that in ten years’ time is likely to be very different from today’s, both nationally and internationally. Taking environmental management seriously presents opportunities for businesses in gaining first-mover advantages.

Environmental sustainability is not just about achieving compliance with legislation or answering public expectations and meeting stakeholder pressure; it is about recognizing and realizing business opportunity, as already Piasecki and colleagues (1999) put it. This means going beyond compliance and working with external and internal partners who are increasingly asking for sustainability, whether stakeholders or consumers, employees or shareholders.

It is therefore imperative of the financial bottom line for firms to engage in environmental sustainability. A conceptual tool that is used in this respect is the Triple Bottom Line (TBL or 3BL) proposed by Elkington (1997) in an effort to “capture the full business agenda” (Robertson 2017: 333). The TBL is comprised of the economic/financial bottom line, the social bottom line and the environmental bottom line, also called the three pillars of sustainability: planet, people, profit (Elkington 2012: 55).

The case for students and educators

Although for businesses “sustainability” and “environmental issues” are often synonymous, academic textbooks on corporate sustainability tend to have a social focus. Emphasising the social aspect of sustainability, textbooks on ethics and on CSR (corporate social responsibility) abound, leaving a distinct lack of material addressing the environmental aspect of sustainability and the so-called triple bottom line.

Furthermore, sustainability textbooks in this area tend to cover either all aspects of sustainability (social, environmental, economic) or specialise in one corporate function (e.g. marketing, operations, or accounting) rather than provide a sustained environmental focus on business and management across functions. In general, conventional (or mainstream) management and organisation studies have not embraced environmental topics, leaving students underexposed to the topic and underprepared for an employment context where sustainability is increasingly important.

This book addresses this gap of teaching material for business and management students and their lecturers, teachers and educators. It could also be used by students in other fields. A student-friendly and academic textbook based on theory, literature and practical examples is provided that encourages active learning through a variety of suggested learning (and teaching) activities.

THE CONTEXT

In order to place the book into the appropriate context, a brief historical excursion is necessary, looking at the various developments in business, politics and society.

History and politics

Politics and business as well as civil society – which van Tulder and van der Zwart (2006: 8) call the “societal triangle” of state, market and civil society (see Figure 1.1) – have shaped the context for business and environmental sustainability. The section here introduces this context, looking at the history of corporate environmental disasters and responses to them from a corporate perspective, environmental policy perspective and the societal perspective. All this has been accompanied and underpinned by academic and non-academic publications on the environment, many of which have become “classics”, as highlighted by Vaz (2012) and Visser (2009).

FIGURE 1.1
The societal triangle: context for corporate environmental sustainability

Following the destruction by war in the 1940s and the rebuilding of societies in the 1950s, it was the 1960s that marked the beginning of the environmental movement, with Rachel Carson’s Silent Spring published in 1962. Both Vaz (2012) and Visser (2009) add Aldo Leopold’s A Sand County Almanac from 1949 to the list of classics to read, in which Leopold calls for a new “land ethic”, and Walden or Life in the Woods by Henry Thoreau from 1854 is considered an even earlier precursor (Vaz 2012), alongside George Perkins Marsh’s Man and Nature (1864, Robertson 2017). It is in the US, in the latter half of the 19th century that the first environmental organisation (The Sierra Club) and the first national park (Yellowstone in 1872) were founded (Buckingham 2008b).

The first use of the term sustainability appears in its German version (Nachhaltigkeit) in 18th-century forest management in Germany, which sought to avoid deforestation damages of the Middle Ages (Robertson 2017).¹ In the same century, Thomas Malthus was concerned about humanity’s ability to feed geometrically increasing populations in light of arithmetically increasing food stocks (Kedia et al. 2011). This is reflected in the definition Kedia and his colleagues provide of sustainability (2011: 73):

Sustainability implies Malthusian concern regarding the carrying capacity of nature in relation to human consumption patterns.

Going back even further, the origins of sustainability in agriculture can be traced back to Mesopotamia where the irrigation and subsequent salinisation of arable land led to changes in land use, including deforestation, and, possibly, ultimately to the collapse of the Babylonian empire (Roorda et al. 2012). Similar problems were found on Easter Island where a lack of ability to shape a social-economic-political system that would avoid the exhaustion of forest resources essential for survival led to the demise of the entire island population (Nemetz 2013).

As a full discussion of the historical context is not possible here, Table 1.1 illustrates the parallel nature of developments within the societal triangle as underpinned by literature over the last 60 years. Often environmental policies at the national level have been the result of twin pressure from international agreements at the regional (e.g. EU) or global level (e.g. UN) and from grassroots (NGOs) and local governments (Buckingham 2008b). The previous image of business as part of the societal triangle illustrates the linkages.

The development of environmental issues in terms of perception, recognition, activism and policy in the 1960s was accompanied by a substantial expansion of higher education in Europe, North Americ...