Canadian Business and Society:
Ethics & Responsibilities
Chapter
Fourteen
The Environment and
Business Responsibilities
Copyright © 2008 McGraw-Hill Ryerson Ltd.
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Chapter Outline
 Defining Environmental Ethic and Sustainable
Development
 Environmental Concerns in Business and Society
 Government’s Influence
 Environmental NGO Influence
 Market-Driven Environmentalism
 Managing Responses to Environmental Concerns
 The “Greening” of Business Functions
 Measuring and Reporting on Environmental
Sustainability
 Dissenting Views on the Environment
 The Environment: Corporate Opportunities and Threats
Chapter 14
Copyright © 2008 McGraw-Hill Ryerson Ltd.
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Defining Environmental Ethic
Environmental ethic: the set of values or
principles that govern a corporation’s
practices relating to the environment.
Chapter 14
Copyright © 2008 McGraw-Hill Ryerson Ltd.
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Defining Sustainable Development
Sustainable development: development
ensuring that the use of resources and the
impact on the environment today does not
damage prospects for the use of
resources or the environment by future
generations.
Chapter 14
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Environmental Concerns in Business and
Society
Acid rain
Air pollution
Ecosystems
Energy production
and consumption
Nature and wildlife
Chapter 14
Ozone
Pollution
Waste
management
Water quality
Climate change/
global warming
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Government’s Influence
 Government departments and agencies:
Environment Canada
Canadian Council of Ministers of Environment
National Roundtable of the Environment and the
Economy
Canadian Environmental Assessment Act Agency
 Regulation:
Canadian Environmental Protection Act, Canadian
Environmental Assessment Act, Kyoto Protocol
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Environmental NGO Influence
 Environmental non-governmental organizations
(ENGOs): groups that hold shared values or
attitudes about the challenges confronting the
natural environment and advocate for changes
to improve the condition of the environment.
 Such groups (e.g., Greenpeace) influence
corporations through protests, blockades,
boycotts, and annual shareholder meetings.
Chapter 14
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Difference between Standard and
Market Environmentalism (Table 14.2)
Factors
Standard
Market
Economic
Growth
Destructive
Free Trade
Part of the
problem
1. Higher enviro.
quality
2. Innovation
Increases
competition for
good enviro.
practices
Ownership creates
stewardship
Property Rights Govn’t will protect
vs. Regulation
Chapter 14
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Market-Driven Environmentalism
Emissions trading: A system whereby
corporations set targets for greenhouse
gas reduction; if one corporation cannot
meet the target, it purchases credits from
those that have met their targets.
Offsets: Credits purchased from other
corporations or organizations to mitigate
greenhouse gases released into the
environment.
Chapter 14
Copyright © 2008 McGraw-Hill Ryerson Ltd.
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Managing Responses to Environmental
Concerns
Token response (e.g., ‘greenwashing’)
Compliance with laws and regulations
Comprehensive environmental
management (gaining a competitive
advantage)
Sustainable development
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The “Greening” of
Business Functions
Financial management
Marketing (e.g., green marketing)
Human resources
Production
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Measuring and Reporting on
Environmental Sustainability
 Type and amount of materials used
 Source of energy and efficiency of use
 Source and quality of water
 Impact on biodiversity
 Reduction of emissions, effluents, and waste
 Product design that minimizes impact
 Compliance with environmental laws
 Use of efficient transportation
Source: GRI, 2006
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Measuring and Reporting on
Environmental Sustainability
 Coalition for Environmentally Responsible
Economies (CERES)
 International Organization for Standardization
ISO 14000
 International Institute for Sustainable
Development (IISD)
 Canadian Sustainability Indicators Network
(CSIN)
 Environmental and Sustainable Development
Indicators Initiative (ESDI)
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Dissenting Views on
the Environment
According to some business journalists:
Concept difficult to define and understand
Means stopping or constraining economic
development
Implies capitalism is unsustainable
Lacks understanding of markets
Executives are being misled
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The Environment:
Corporate Opportunities
 Reputations likely enhanced
 Customers attracted
 Investors attracted
 Costs reduced through recycling/conservation
 More competent staff attracted
 Better integration with local community
 New technologies or expertise developed
 More efficient ways of producing products found
Chapter 14
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The Environment:
Corporate Threats
 Corporate image may deteriorate
 Revenues may suffer if customers are lost
 Investors may decide not to invest
 Material and production costs may increase
 Financial penalties increasing
 Insurance premiums can increase
 Potential alienation from local community
 Government may enact stricter legislation
Chapter 14
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