🤝Topics in Responsible Business Unit 5 – Environmental Stewardship & Eco-Efficiency

Key Concepts

• Sustainability focuses on meeting present needs without compromising future generations' ability to meet their own needs
  • Includes environmental, social, and economic dimensions (triple bottom line)
• Eco-efficiency aims to deliver goods and services while minimizing ecological impacts and resource intensity
  • Seeks to create more value with less environmental impact
• Circular economy designs out waste and pollution, keeps products and materials in use, and regenerates natural systems
  • Moves away from linear "take-make-waste" model
• Life cycle assessment (LCA) evaluates environmental impacts associated with all stages of a product's life from cradle to grave
  • Includes raw material extraction, materials processing, manufacture, distribution, use, repair and maintenance, and disposal or recycling
• Carbon footprint measures total greenhouse gas emissions caused directly and indirectly by an individual, organization, event or product
  • Expressed as carbon dioxide equivalent (CO2e)
• Environmental stewardship involves responsible use and protection of the natural environment through sustainable practices and conservation
• Corporate social responsibility (CSR) is a self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public

Environmental Challenges

• Climate change driven by greenhouse gas emissions is causing rising temperatures, sea levels, and more frequent extreme weather events
  • Burning fossil fuels (coal, oil, gas) for energy is the main source of emissions
• Deforestation, primarily for agricultural expansion, is reducing biodiversity, altering water cycles, and contributing to climate change
  • Forests absorb CO2, provide habitat, and regulate local and regional climate
• Air pollution from industrial activities, transportation, and energy production impacts human health and the environment
  • Major pollutants include particulate matter, ozone, nitrogen oxides, and sulfur oxides
• Water scarcity and pollution threaten access to clean, safe drinking water for billions of people
  • Agriculture, industry, and domestic use all contribute to water stress
• Soil degradation from erosion, salinization, and contamination reduces agricultural productivity and ecosystem health
• Biodiversity loss due to habitat destruction, overexploitation, pollution, and climate change is occurring at unprecedented rates
  • Reduced genetic diversity makes species more vulnerable to disease and environmental changes
• Waste generation, particularly plastic waste, is overwhelming waste management systems and polluting the environment
  • Only 9% of plastic waste ever produced has been recycled

Sustainability Principles

• Intergenerational equity ensures fair access to resources and a healthy environment for current and future generations
• Precautionary principle states that if an action has a suspected risk of causing harm, the burden of proof falls on those taking the action to prove it is not harmful
  • Encourages proactive measures to prevent harm when impacts are uncertain
• Polluter pays principle requires that the costs of pollution be borne by those who cause it
  • Incentivizes companies to internalize environmental externalities and invest in cleaner production
• Sustainable resource management balances the economic, social, and environmental values of resources over the long term
  • Considers carrying capacity and regeneration rates of renewable resources
• Stakeholder engagement involves identifying and including people who may be affected by or have an effect on an organization's actions
  • Enables understanding of stakeholder needs and concerns to inform decision-making
• Environmental justice seeks fair treatment and meaningful involvement of all people in environmental policy and development
  • Addresses disproportionate impacts of pollution and environmental hazards on disadvantaged communities
• Sustainable consumption and production decouples economic growth from environmental degradation
  • Promotes resource and energy efficiency, sustainable infrastructure, and green jobs

Corporate Responsibility

• Environmental management systems (EMS) like ISO 14001 provide a framework for organizations to manage their environmental responsibilities
  • Involves developing an environmental policy, setting objectives and targets, implementing programs, monitoring and correcting, and management review
• Sustainability reporting discloses an organization's impacts and performance on environmental, social, and governance (ESG) issues
  • Common frameworks include Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB)
• Supply chain sustainability extends responsibility for environmental and social impacts beyond an organization's direct operations
  • Includes sustainable sourcing, supplier codes of conduct, and collaboration to drive improvements
• Green procurement prioritizes the purchase of products and services with lower environmental impacts
  • Considers factors like energy efficiency, recycled content, and end-of-life management
• Employee engagement on sustainability empowers workers to identify opportunities and implement solutions
  • Can include green teams, training programs, and sustainability-linked compensation
• Community outreach and partnerships build trust and support for an organization's sustainability initiatives
  • May involve local environmental projects, educational programs, and stakeholder dialogues
• Sustainability innovation drives the development of new products, services, and business models that create value while reducing environmental impacts
  • Requires a culture of experimentation, collaboration, and systems thinking

Eco-Efficiency Strategies

• Lean production minimizes waste in all forms, including overproduction, waiting, transport, overprocessing, inventory, motion, and defects
  • Focuses on continuous improvement and employee engagement to drive efficiency
• Cleaner production reduces the environmental impact of processes and products while increasing efficiency and profitability
  • Involves pollution prevention, toxics use reduction, and design for environment
• Industrial ecology applies ecosystem principles to industrial systems, viewing waste from one process as raw material for another
  • Enables circular resource flows and minimizes waste and pollution
• Dematerialization reduces the quantity of materials used to serve economic functions, decoupling resource use from economic growth
  • Can be achieved through miniaturization, digitization, and servitization (selling services instead of products)
• Energy efficiency lowers the amount of energy required to provide products and services
  • Includes building retrofits, efficient equipment and appliances, and behavioral changes
• Renewable energy replaces fossil fuels with sources like solar, wind, hydro, geothermal, and biomass
  • Reduces greenhouse gas emissions and dependence on finite resources
• Water conservation and reuse minimizes freshwater withdrawals and wastewater discharges
  • Strategies include process optimization, leak detection and repair, rainwater harvesting, and wastewater recycling

Green Technologies

• Renewable energy technologies harness naturally replenished energy sources like sunlight, wind, rain, tides, waves, and geothermal heat
  • Include solar photovoltaics, concentrated solar power, wind turbines, hydroelectric, and geothermal power plants
• Energy storage systems like batteries, flywheels, compressed air, and pumped hydro allow renewable energy to be stored for later use
  • Helps balance supply and demand and stabilize the grid
• Smart grids use digital communications and controls to monitor and optimize power generation, transmission, and distribution
  • Enable integration of distributed renewable energy and demand response programs
• Electric vehicles (EVs) use electric motors powered by rechargeable batteries instead of internal combustion engines
  • Reduce tailpipe emissions and can be powered by renewable electricity
• Green buildings incorporate design, construction, and operational practices that significantly reduce or eliminate negative impacts on the environment and occupants
  • Features may include efficient HVAC, lighting, and water systems, renewable energy, green roofs, and sustainable materials
• Bioplastics are derived from renewable biomass sources like vegetable fats and oils, corn starch, straw, and recycled food waste
  • Can be biodegradable and compostable, reducing plastic waste
• Precision agriculture uses GPS, sensors, and big data to optimize crop yields while minimizing inputs like water, fertilizer, and pesticides
  • Enables more sustainable and efficient food production

Regulatory Landscape

• United Nations Sustainable Development Goals (SDGs) provide a shared blueprint for peace and prosperity for people and the planet
  • Adopted by all UN member states in 2015 with 17 goals and 169 targets to achieve by 2030
• Paris Agreement is an international treaty on climate change adopted in 2015 with the goal of limiting global warming to well below 2°C above pre-industrial levels
  • Requires countries to submit nationally determined contributions (NDCs) outlining emissions reduction plans
• Carbon pricing puts a price on carbon emissions through carbon taxes or cap-and-trade systems
  • Incentivizes companies to reduce emissions and invest in clean technologies
• Extended producer responsibility (EPR) policies require producers to take responsibility for the end-of-life management of their products
  • Can include product take-back, recycling targets, and eco-design requirements
• Renewable portfolio standards (RPS) require a specified percentage of electricity to come from renewable sources by a certain date
  • Drives demand for renewable energy and spurs investment in clean power generation
• Energy efficiency standards set minimum energy performance requirements for products like appliances, lighting, and vehicles
  • Reduces energy consumption and saves consumers money over the life of the product
• Green public procurement policies require government agencies to consider environmental criteria when purchasing goods and services
  • Leverages the purchasing power of the public sector to drive market demand for sustainable products

Case Studies & Best Practices

• Interface, a global flooring company, has reduced its carbon footprint by 96% since 1996 through renewable energy, closed-loop recycling, and sustainable materials
  • Aims to be a carbon negative company by 2040
• Patagonia, an outdoor clothing company, uses recycled and organic materials, repairs products to extend their life, and donates 1% of sales to environmental causes
  • Encourages customers to buy only what they need and offers a worn wear program for used gear
• Unilever has committed to 100% recyclable, reusable or compostable plastic packaging by 2025 and investing in waste collection and processing infrastructure
  • Reduced waste associated with product disposal by 32% since 2010
• IKEA aims to be climate positive and use only renewable and recycled materials by 2030
  • Has invested heavily in renewable energy, sustainable sourcing, and circular design
• Google has been carbon neutral since 2007 and plans to operate on 24/7 carbon-free energy by 2030
  • Largest corporate purchaser of renewable energy and invests in energy efficiency and clean tech startups
• Walmart launched Project Gigaton to avoid one billion metric tons of greenhouse gases from its supply chain by 2030
  • Works with suppliers to reduce emissions through energy efficiency, renewable energy, sustainable agriculture, and waste reduction
• The Ellen MacArthur Foundation pioneered the concept of the circular economy and works with businesses, governments, and academia to accelerate the transition
  • Developed Circulytics, a tool to measure a company's circularity and identify opportunities for improvement