Corporate Environmentalism

1
Corporate Environmentalism
8803 Business and the Environment Beril
Toktay College of Management Georgia Institute of
Technology
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Overview

• The economic context
• The historical context
• Making sense of how it all fits together

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The Three Economies
Source Hart, Capitalism at the Crossroads
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Environmental Footprint
In the United States, it takes 12.2 acres to
supply the average person's basic needs in the
Netherlands, 8 acres in India, 1 acre. The Dutch
ecological footprint covers 15 times the area of
the Netherlands, whereas India's footprint
exceeds its area by only about 35. Most
strikingly, if the entire world lived like North
Americans, it would take three planet Earths to
support the present world population. Source
Donella Meadows "Our 'Footprints' Are Treading
Too Much Earth, "Charleston (S.C.) Gazette, April
1, 1996.
Source Hart, Capitalism at the Crossroads
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The Wake-up Call
the smell of money

• Publication of Silent Spring in 1962

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Sustainability Buzzwords

• Environmental management
• Corporate social responsibility
• Green design
• Industrial ecology
• Triple bottom line
• Shareholder value
• Eco-efficiency
• Pollution prevention
• End-of-pipe
• Clean fuel
• Cradle to cradle

• Renewable energy
• Design for environment
• Dematerialization
• Sustainable development
• Closed-loop supply chain
• Biomimicry
• Industrial ecology
• Life-cycle management
• Urban reinvestment
• ISO 14001
• Brownfield redevelopment

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Sustainable Value Framework
Building tomorrows opportunity
Growth path
Innovation repositioning
Engaging External Constituencies
Nurturing Internal Capabilities
Legitimacy reputation
Cost and risk reduction
Managing Todays Business
Source Hart, Capitalism at the Crossroads
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Historical Evolution
1963 Silent Spring published
Regulation Rapid proliferation End-of-pipe
regulation, pay to reduce -ve impact Mandates
specific technologies Focus on hazardous waste,
emissions, pollution Industry Compliance
focused Focused on internal manufacturing
processes Resistant adaptation
1984 Bhopal tragedy
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Historical Evolution
1984 Bhopal tragedy
1987 Brundtland report
Industry initiatives Beyond compliance Regulator
y change - outcome based - information based -
market based
Sustainable development is development that
meets the needs of the present without
compromising the ability of future generations to
meet their own needs.
1989 Exxon Valdez Oil Spill
1992 Rio World Economic Summit
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Historical Evolution
1992 Rio World Economic Summit
1995 Brent Spar incident
Strategic view of sustainability Stakeholder
involvement Alliances with NGOs Corporate Social
Responsibility International collaboration
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Sustainable Value Framework
Tomorrow
Strategy Sustainable Technology Develop
sustainable competencies of the
future Corporate Payoff Innovation
repositioning
Strategy Sustainable Development Create a
shared roadmap for meeting unmet needs Corporate
Payoff Growth path
External
Internal
Strategy Product Stewardship Integrate
stakeholder views Into business
processes Corporate Payoff Reputation and
legitimacy
Strategy Eco-efficiency Minimize waste
emissions Corporate Payoff Cost risk reduction
Today
Source Hart, Capitalism at the Crossroads
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Sustainability Framework
Tomorrow

• Biomimicry
• Renewable energy
• Clean technology

• Triple-bottom line
• Sustainable development
• Urban reinvestment
• Brownfield development

External
Internal

• Pollution prevention
• Waste reduction
• Environmental Mgt
• ISO 14001
• Risk management
• End of pipe

• Life-cycle management
• Design for environment
• Closed-loop supply chain
• Dematerialization
• Cradle to cradle

Today
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Flow of Course
Fundamentals
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Concepts

• A historical perspective
• Framework to classify sustainability initiatives
• The limits of the win-win argument
• The limits of the shareholder value argument

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Suggested Readings

• Carson, Silent Spring
• Hart, Capitalism at the Crossroads
• Elkington, Cannibals with Forks
• Frankel, In Earths Company