10 The Environment and Sustainability
• Sustainability refers to the capacity of healthy ecosystems to continue functioning
indefinitely or economic development that meets the needs of the present generation
without compromising the ability of future generations to meet their needs.
Environmental Degradation
Air Pollution
• Air pollution occurs when the release of materials to the atmosphere cannot be safely
disposed of by natural processes.
• Six common air pollutants:
o Particulate matter refers to small particles that occur because of dusty industries
and smoke.
o Ozone refers to the combination of three atoms of oxygen that occurs in the
atmosphere.
• The major concerns with the six common air pollutants:
o High levels of ground ozone have been linked to various respiratory ailments.
o High exposure to particulate matter has also been linked to respiratory ailments as
well as heart disease such as irregular heartbeat and heart attacks.
o Carbon monoxide is an extremely dangerous gas that reduces the ability of the body
to deliver oxygen to the heart and the brain.
• Climate change is a significant and lasting change in the statistical distribution of weather
patterns over periods ranging from decades to millions of years.
Land Pollution
• Land pollution refers to the contamination that occurs when toxic waste and other waste
material that don’t belong on land are disposed of on land.
Water Pollution
• Water pollution refers to the contamination of water sources such as lakes, streams, wells,
and oceans by substances that are harmful to living organisms.
• Six key areas companies can voluntarily adopt to help face the water challenges:
1. Direct operations: conduct water footprint to assess water use and find ways to
reduce such water use
2. Supply chain water management: find ways to work with others in the supply
chain to improve water use
Building the Environmentally Sustainable Company: A Strategic Approach
Top Management Support
• Top management support: support for sustainability from top management.
• Four top management mindsets regarding sustainability:
o Corporate conventionality mindset places strong emphasis on profit making.
o Pragmatism mindset suggests that these executives take a more practical view of
sustainability.
Assessing Current Sustainability Situation
• Two types of companies engaged in sustainability:
o Embracer types: where companies fully embrace sustainability efforts.
o Cautious adopters: where companies see sustainability as limited to those
activities that are linked to short-term efficiency.
• Primary activities are those activities that are directly linked to creating the product.
• Primary activities include:
1. Supply chain management—the many activities and costs incurred in securing
the raw materials and other energy requirements needed for production.
2. Operations—this pertains to the many activities and costs that are necessary to
convert raw materials into finished products.
• Support activities are activities that are provided to support the primary activities.
• Support activities include:
1. Product research and development, technology and systems development—
these include the costs and activities related to R&D as well as the development of
appropriate information systems to support primary activities.
Setting Sustainability Goals
• Sustainability goals: sustainability targets that companies set to achieve.
Reporting and Feedback
• Sustainability reporting refers to the efforts by the company to report its sustainability
efforts and the progress made on such efforts.
Other Success Factors
• Other factors that contribute to success:
o Be a first mover.
Benefits of Sustainability
• Sustainability benefits refer to the many advantages companies enjoy as a result of their
sustainability efforts.
• Sustainability benefits include:
o Avoiding public relations nightmares.
o Avoiding fines and other legal costs.
o Cost reduction.