Sustainable Business in Sustainable Development by rjh17349


									  Sustainable Business
Sustainable Development
Sustainable Development

     How do you solve an oxymoron?
 A Global Development Dilemma: Two Vicious Circles

                Poverty                Affluence

Environmental             Resource imports,        Environmental
 degradation              pollution exports         degradation
     How does poverty cause environmental damage?
   Agriculture: need to survive causes overuse of land (grazing, intensive
    agriculture, fertilizer, fuel wood, logging) leading to deforestation,
    topsoil erosion, water contamination
         Worsened by:
          population pressures;

          lack of control over local resources and poor governance;

          Inability to invest in environment

   Industry: inefficient, dirty industry locates where wages and influence
    over environment are low, causing pollution of air, land, and water
          Cost-based competition

          Labour intensive

          Low capacity to invest in environment
    How does affluence cause environmental damage?
   High productivity levels cause greater throughput of materials and
    energy per person
   Higher income levels enable greater consumption of energy and
   Greater throughput of energy and materials means more land used for
    agriculture (more pesticides, fertilizers, erosion), more wood and
    mineral resources used, more energy extracted and used, etc.
   Urbanization has disconnected producers and consumers relieving
    them of the influence of environmental degradation on their lives.
   Trade in resources, pollution and waste
   Exploitation of global commons for resources and
    waste disposal
   Impact of local actions on global health
             Two Paths to Sustainable Development
                   Livelihood             Lifestyle

                Poverty                           Affluence

                              Resource imports,
Environmental                                             Environmental
                              pollution exports
 degradation                                               degradation

     Welfare              Cooperation on Global Environmental
     Improvement:             Governance        Remediation:
     Basic needs (food,                             Production
     shelter, edu.)
     Productive employment                          Consumption
     Control over resources                         Fulfilling employment/leisure
     Population control                             Responsibility and participation
     Energy                                         Energy
From Ad Hoc Responses to the
Environmental Crisis…
 Social Demands
  Disasters, Cumulative Poisoning, Habitat Destruction
  Scientists, Environmentalists, and Community
 Political Responses
  Government Regulations, Penalties, and
  International Conferences and Agreements
…to an (Ambiguous) Consensus on
    Sustainable Development
"Sustainable development is development
  that meets the needs of the present
  without compromising the ability of
  future generations to meet their own
  needs. ” (WCED)
The short definition was qualified by its originators in
 the following manner: “It (sustainable development)
          contains within it two key concepts:

      the concepts of needs, in particular the essential
       needs off the world's poor, to which overriding
       priority should be given; and

      the idea of limitations imposed by the state of
       technology and social organization on the
       environment's ability to meet present and future
       needs.” (WECD, 1987, 43)
History of Sustainable Development
    Stockholm 1972: UN Conference on the Human
    Report of the World Commission on the
     Environment and Development: “Our Common
     Future” 1987.
    Rio 1992: UN Conference on Environment and
     Development: Agenda 21
    Johannesburg 2002: 2nd World Summit on
     Sustainable Development
Far-Reaching Ethical, Political and
     Economic Implications
   Raised the environmental issue to a high
   Recognizing the issue of intra-generation
    and inter-generation equity;
   While, still allowing for growth and
   And bound all countries to a global effort.
    National Strategies
   revive growth, but change the quality of growth;
   meet essential needs for jobs, food, energy, water, and
   ensure a sustainable level of population;
   conserve and enhance the resource base;
   reorient technology and manage risk;
   merge environment and economics in decision making;
    Global Strategies
   enhance the flow of capital to developing countries;
   link trade, environment, and development by improving
    the terms of trade;
   increase the diffusion of environmentally sound
    technologies and their funding to developing countries.
    Controversy and Acceptance
   Weak vs. Strong sustainability
   Human-centered (anthropocentric) vs. Nature-
    centered (ecocentric) perspective
   Laissez-faire vs. Distributive Justice
   Social vs. Scientific Definition
   Private vs. public vs. common property views
Who does sustainable development?
   The UN and its agencies
       Dozens of environmental conventions and
   National, state, local governments, communities
       110 national, over 6000 local Agenda 21s
   Non-governmental organizations
       Thousands involved
   Companies
       Corporate social responsibility/sustainability programs;
        ethical investing
   Consumers
       Green consumer movements, fair trade
     HK‟s Sustainable Development

Sustainable development in Hong Kong balances
social, economic and environmental needs, both for
present and future generations, simultaneously
achieving a vibrant economy, social progress and
better environmental quality, locally, nationally
and internationally, through the efforts of the
community and the Government.
Sustainable Development: as a balance


      Society                 Economy
 Sustainable Development as Integration


Environment                                       Environment
              Industrial             Industrial
              Ecology                   Ecology

       Politics                              Economy
                           Industrial     Business
                                         Environmental
        Accepted Principles
   public trust doctrine
   precautionary principle
   inter-generational equity
   intra-generational equity
   subsidiarity principle
   polluter pays principle (PPP)
   user pays principle (UPP)
   The public trust doctrine means that
    governments must act to prevent
    environmental damage whenever a
    threat exists, whether it is covered by a
    specific law or not.
   The precautionary principle holds that
    where there are threats of serious or
    irreversible damage, lack of full
    scientific certainty shall not be used as
    a reason for postponing cost-effective
    measures to prevent environmental
   The principle of inter-generational
    equity is at the heart of the definition of
    sustainable development. It requires
    that the needs of the present are met
    without compromising the ability of
    future generations to meet their own
   The principle of intra-generational
    equity requires that people within the
    present generation have the right to
    benefit equally from the exploitation of
    resources and that they have an equal
    right to a clean and healthy
   The subsidiarity principle requires
    that decisions should be made by the
    communities affected or on their behalf,
    by the authorities closest to them.
   The user pays principle (UPP) applies
    the PPP more broadly so that the cost
    of a resource to a user includes all the
    environmental costs associated with its
    extraction, transformation and use
    (including the costs of alternative or
    future uses foregone).
   The polluter pays principle (PPP)
    suggests that the polluter should
    internalize all the environmental costs of
    their activities so that these are fully
    reflected in the costs of the goods and
    services they provide.
          Polluter-pays is key to a clean
             environment, says Liao
   She hopes people will accept the approach as the backbone for
    environmental protection.

   Dr Liao said the construction-waste charging scheme was a
    "golden test" of the principle and she would do everything
    necessary to lobby support for it. She said the scheme was
    fair because it held waste-producers, not the transporter, liable
    for failing to pay.

   Dr Liao also called for an expanded producer responsibility
    programme, such as packaging laws for electrical
    manufacturers - it is currently free to dump a television set in a
    landfill - with costs passed on to consumers in the form of
    higher product costs.
What does sustainable development
mean to business?
 Continued regulatory pressure and a shifting
  of the „business environment‟
    Governance
    Growth
    Economic role
    Technology
    Local interaction
    Consumption
Sustainable Business
How has business reacted to
environmental demands?

    Denial and Cover-up
    Environmental Management
    Strategy
Denial and Cover-up
   Costs
   Priorities
   Liability Exposure
   Ignorance
Environmental Management
    ‘End-of-pipe’ technologies
    ‘Reaping low-hanging fruit’
    Establishment of Environment,
     health and safety departments
    Environmental Management
   Pollution Prevention
   Product Stewardship
   Clean Technologies
   Sustainability Vision
          International Chamber of Commerce (ICC)
        Business Charter for Sustainable Development

   1. Corporate Priority             10. Precautionary Approach
   2. Integrated Management          11. Contractors and Suppliers
   3. Process of Improvement         12. Emergency Preparedness
   4. Employee Education             13. Transfer of Technology
                                      14. Contributing to the Common
   5. Prior Assessment                Effect
   6. Products or services           15. Openness to Concerns
   7. Customer Advice                16. Compliance and Reporting
   8. Facilities and Operations
   9. Research
Four Perspectives on Environmental
        Ethics and Strategy
   The Triple Bottom Line
   Beyond Greening
   Ending the Stalemate between
    Environmental Performance and
   Natural Capitalism
Corporate Governance and Sustainability:
             New Voices
              Government
              Trading Partners
              Community
              Employees
              Investors
              Insurers
              Media
              Pressure Groups
              Customers
    What‟s so special about Society‟s
environmental expectations of Business???
      Taxes
      Health and workers‟ compensation
      Unemployment insurance
      Product liability
      Pensions
       Values Created through a Sustainable
                Business Strategy
How can you make money from:
   Improved product quality?
   Healthy working environment and staff commitment?
   Improved community relations?
   Positive pressure group relations?
   Improved media coverage?
   Green Products and byproducts?
   Cheaper finance?
   Lower insurance and legal costs?
   Assured present and future compliance?
   Improved materials and energy efficiency?
   Reduced cleanup and decommissioning costs?
   Reduced supplier and customer costs?

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