SR 8

Environmental Issues
BAC 107 Good Governance and Social Responsibility

Global Environmental Issues
 Natural
environment – the
physical world,
including all
biological entities, as
well as the
interaction among
nature and
individuals,
organizations and
business strategies
Global Environment Issues
 Atmospheric Issues
 Air Pollution – It typically arises from 3 different
sources: stationary sources such as factories and power
plants; mobile source such as cars, trucks, planes and
trains; and natural sources such as windblown dust and
volcanic eruptions; this gases / particulates may cause
respiratory problems, birth defects and cancer, even
haze that reduces visibility
 Acid Rain – this is the result when nitrous oxide and
sulfur dioxides from factories react with air and rain; it
may corrode paint and deteriorate stones
 Global Warming
 Kyoto Protocol – a treaty proposed among industrialized
nations to slow global warming
 Water Issues
 Water Pollution – Water pollution results
from the dumping of raw sewage and toxic
chemicals into rivers and oceans, from oil
and gasoline spills, and from the burial of
industrial wastes in the ground where they
may filter into underground water supplies
 Water Quantity – There has been sixfold
increase in water use worldwide since 1990,
and as a result, one-fifth of the world’s
population now has no access to safe
drinking water
“Whiskey is for drinking, water is for
fighting over.” – Mark Twain
 Land Issues
 Land Pollution – results from the dumping of residential and
industrial wastes, strip mining, and poor forest conservation
 Waste Management
 Deforestation
 Urban Sprawl
 “degenerate urban form that is too congested to be efficient, too
chaotic to be beautiful, and too dispersed to possess the diversity
and vitality of a great city” – James Kuntsler
The P389-million Dolomite Beach project involved dumping crushed
dolomite on a 500-meter stretch of land along Manila Bay.
Proponents called the undertaking “beach nourishment,” but critics
called it a massive waste of people's money
(https://newsinfo.inquirer.net/)
 Biodiversity
 The world’s tropical forests, which
cover just 7 % percent of the Earth’s
land surface account for more than
half of the planet’s biological
species. The importance of these
ecosystems is highlighted by the fact
that 25% of the world’s prescription
drugs are extracted from plants
primarily growing in tropical
rainforests. 70% of the 3,000 plants
identified as sources of cancer-
fighting drugs come from tropical
forests, and scientists suspect that
many more tropical plants may have
pharmaceutical benefits. However,
these forests are being depleted at
alarming rates
 Genetically Modified Foods
 Genetic engineering involves
transferring one or more genes
from one organism to another to
create a new life form that has
unique traits.
 One of the primary goals of using
GMO plants is the reduction in the
use of pesticides and other farming
practices that harm the
environment. However, further
researches are being conducted to
determine how to prevent GMO
crops from killing beneficial and
harmless insects, and to deter
herbicide-resistant genes from
spreading into weeds.
Campaign Ads Against GMOs
Business Response to Environmental Issues
 In response to environmental issues, firms

have improved their reputations by
creating new executive positions such as
vice president for environmental affairs
(e.g. Walt Disney and Chevron). AT&T
supports and helps publish the Green
Business Letter, a hands on journal for
environmentally conscious companies.
 Corporate efforts to respond to
environmental issues focus on green
marketing, recycling, emission reductions,
and socially responsible buying.
 Green marketing
 Green marketing refers to the specific development,
pricing, promotion, and distribution of products that
do less harm to the environment.
 E.g. General Motors is developing new “hybrid” pick
up trucks and buses that employ electric motors to
augment their internal-combustion engines,
improving the vehicles’ fuel economy without a loss
in power.
 Many products are certified as “green” by
environmental organizations such as Green Seal and
carry a special logo. However, a recent study by
Consumers International suggests that consumers
are being confused and even misled by green
marketing claims. (usage of “environmentally
friendly,” “nonpolluting,” “earthworm friendly”)
 Recycling initiatives
 Recycling initiatives is the process of materials,
especially steel, aluminum, paper, glass,
rubber, and some plastics for reuse.
 E.g. Procter & Gamble uses recycled materials
in some of its packaging and markets refills for
some products, which reduce packaging waste.
 E.g. Starbucks makes coffee grounds available
free to those who wish to use them for compost
to add nutrition to their gardens
 Emissions Reduction Initiatives

 Green power – energy sources that are commonly
accepted as having relatively low impact on human,
animal, and ecosystem health
 Many companies are going beyond the emission
reductions called for by the 1997 Kyoto Protocol,
which set a goal of reducing greenhouse emissions by
signing countries by 7% from their 2000 levels. Those
companies that achieve reductions in excess of that
called for by the Kyoto Protocol earn credits that may
then be “traded” to other firms that have not yet
achieved their targets.
 Socially Responsible Buying
 Socially Responsible Buying (SRB) can be defined as “that
which attempts to take into account the public consequences of
organizational buying or bring about positive social change
through organizational buying behavior.” – Minette Drumwright
 E.g. In the 1990s, when disposable cameras were popular, Kodak
obtained licensing rights from Fuji to produce and manufacture
single-use camera. With the continuing bulge of waste and
scarcity of resources, it decided to launch a recycling program for
the QUickSnap camera. They offer a base price for one-time-use
cameras and recycled the products. However, Jazz Photo
Corporation decided to shave profits by taking used Fuji and
Kodak camera cases, place new film, color out the labels and
market the said cameras to retailers. Kodak decided to file suit
against the Jazz Photo Corporation for patent infringement
whereas the former claimed $22.9 million in damages for the
relabeling.
Strategic Implementation of
Environmental Responsibility
 Businesses have responded to the opportunities and threats
created by environmental issues with varying levels of
commitment. A high-commitment business develops strategic
management programs, which view the environment as an
opportunity for advancing organizational interest. Stakeholder
analysis requires a process for identifying and prioritizing the
many claims and stakes on its business and for dealing with
trade-offs related to the impact on different stakeholders. Risk
analysis tries to assess the environmental risks and trade-offs
associated with business decisions. Organizations that are highly
committed to environmental responsibility may conduct an audit
of their efforts and report the results to all interested
stakeholders. Such organizations may use globally accepted
standards, such as ISO 14000, as benchmarks in a strategic
environmental audit.

SR 8

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Environmental Issues

BAC 107 Good Governance and Social Responsibility

 In response to environmental issues, firms

 Emissions Reduction Initiatives

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