The Natural Environment as Stakeholder

Chapter 15
Prepared by Deborah Baker
Texas Christian University

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Business and Society: Ethics and Stakeholder Management, 7e • Carroll & Buchholtz
Copyright ©2009 by South-Western, a division of Cengage Learning. All rights reserved
 Chapter 15 Learning Outcomes

1. Discuss the concept of sustainability.

2. Describe ten major natural environment issues.
3. Describe the causes of the NIMBY environmental
problem.
4. Discuss the roles that business and government
play in environmental issues.
5. Explain the concept of environmental ethics.

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 Chapter 15 Outline

 The Sustainability Imperative

 A Brief Introduction to the Natural Environment
 Impact of Business upon the Natural Environment
 Natural Environmental Issues
 Responsibility for Environmental Issues
 The Role of Governments in Environmental Issues
 Other Environmental Stakeholders
 Business Environmentalism
 The Future of Business: Greening and / or Growing?
 Summary
 Key Terms
 Discussion Questions
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 Chapter 15 Introduction

This chapter introduces the concept of sustainability and

its importance to business. A discussion of top
environmental issues and ethics leads to an exploration
of the role of government, environmental interest groups,
and businesses on developing environmental strategy.

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 The Sustainability Imperative

Meeting the needs of the present

without compromising the ability
Sustainability of future generations to meet their
own needs.

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 Six Principles of Sustainable Success

1. Your business is part of a much larger system.

2. The culture of your business is determined by the
context you create for it.
3. The soul of a business is found in the hearts of its
people.
4. True power is living what you know.
5. You can’t predict the future, but you can create it.
6. There is a way to make an idea’s time come.

Figure 15-1 6
 Introduction to the Natural Environment

Humans are a part of their natural environment.

The environment is extremely complex.

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 Environmental Terms
 Environment
 Carbon Neutral
 Carrying Capacity
 Entropy
 Ecosystem
 Niche
 Cycle
 Threshold
 Pollution
 Irreversibility @ [Link]

 Sustainability 8
Figure 15-2
 Top Ten List of Environmental Issues

1. Climate Change
2. Energy
3. Water
4. Biodiversity and Land Use
5. Chemicals, Toxics, and Heavy Metals
6. Air Pollution
7. Waste Management
8. Ozone Layer Depletion
9. Oceans and Fisheries
[Link]
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 Global Carbon Dioxide Emissions

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Figure 15-3
 Energy

Addressing Energy Inefficiency

• Use as little energy as possible

• Shift to renewable sources

• Solar
• Wind
• Hydroelectric
• Biomass forms

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 Water

Degradation of Oceans and Waterways

• Municipal sewage
• Industrial wastes
• Urban runoff
• Agricultural runoff
• Atmospheric fallout
• Overharvesting
• Dam sedimentation
• Deforestation
• Overgrazing
• Over-irrigation 12
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 Biodiversity

The variation of life forms inside

Biodiversity an ecosystem

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 Land Use

Land Degradation

• Desertification
• Deforestation
• Overgrazing
• Salinization
• Alkalization
• Soil acidification
• Urban sprawl
• Soil sealing

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 Toxic Substances

Problems

1. We are not aware of the effects of exposure to

chemicals produced each year.

2. Toxic substances can be associated with industrial

accidents, causing widespread biological damage.

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 Air Pollution

Effects of Air Pollution

• Acid rain
• Global warming
• Smog
• Depletion of the ozone layer

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 Waste Management

Reduce

Re-Use

Recycle

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 Waste Trends in the U.S.

Figure 15-4 18
 Ozone Depletion

The decrease in the ozone layer

Ozone
that blocks dangerous ultraviolet
Depletion radiation from the sun.

Ozone Watch
@ [Link]

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 Oceans and Fisheries

An area that drains to a common

Watershed waterway.

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 Responsibility for Environmental Issues

Tragedy of the Commons

Constraints must be placed on the use of the commons

(i.e., our environment) because in the absence of
constraints, self-interest is likely to lead
individuals and organizations to behave in ways
that will not sustain our shared resources.

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 The NIMBY Problem

“Not in my Back Yard”

NIMBY

 NIMBY is the human denial of responsibility for

misuse of the environment

 Entities causing environmental pollution are not

identified as the sources of the problem

 NIMBY avoids or denies the root cause of the

damage

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 The Role of Governments
in Environmental Issues
U.S. Government Response

 National Environmental Policy Act (NEPA)

 Environmental Protection Agency (EPA)
 Air quality legislation
 Water quality legislation
 Land-related legislation
 Endangered species protection

@ [Link]
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 International Government
Environmental Responses
International Government Response

United Nations Environmental Programme (UNEP)

Montreal Protocol
Global Waters Assessment
Global Compact
Global Reporting Initiative (GRI)

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 Other Environmental Stakeholders

Environmental interest Other stakeholders

groups include… include…

 Radicals  Green consumers

 Mainstreamers  Green employees
 Accommodators  Green investors
 Ecoterrorists

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 CERES Principles

1. Protection of the biosphere

2. Sustainable use of natural resources
3. Reduction and disposal of waste
4. Energy conservation
5. Risk reduction
6. Safe products and services
7. Environmental restoration
8. Informing the public
9. Management commitment
10. Audits and reports @ [Link]
Figure 15-7 26
 Business Environmentalism

Responsible Environmental Stewards

 Patagonia
 3M Company
 Stonyfield Yogurt

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 Business Case for Sustainability

1. The upside benefits

2. The downside risks

3. The right thing to do

Cost-Benefit Analysis

Triple Bottom Line

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 Systematic Business Responses
to the Environmental Challenge

 Crisis management
 Issues management

 Stakeholder management
 Sustainability

 Strategic environmental management

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 Strategic Environmental Management

Figure 15-8 30
 Strategic Environmental Management

The international management standard,

which includes organizational
environmental objectives, issues, policies,
ISO 14000 systems, and documentation aimed at
continual improvement of environmental
performance.

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 Future of Business:
Greening or Growing?

How much is enough?

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 Key Terms

 Externalities  Environmental Protection

 Sustainability Agency (EPA)
 Carbon neutral
 Clean air act
 Emissions trading
 Environment
 Clean water act
 Climate change  Toxic substances control
 Global warming act
 Greenhouse effect  Superfund
 Energy inefficiency  Endangered Species Act
 Biodiversity  Montreal Protocol
 Toxic substances  Global compact
 Air pollution  Global reporting initiative
 Ecoterrorists
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 Key Terms (continued)

 Acid rain  CERES Principles

 Ozone  Cost-benefit analysis
 Watershed  Triple Bottom Line
 Deforestation  Strategic Environmental
Management
 Wicked problems  ISO 14000
 Tragedy of the commons  Strategic Sustainable
 NIMBY Management
 Environmental Impact
Statements

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