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Report
Corporate Environmentalism
8803 Business and the Environment
Beril Toktay
College of Management
Georgia Institute of Technology
Overview
 The
economic context
 The historical context
 Making sense of how it all fits together
The Three Economies
Source: Hart, Capitalism at the Crossroads
Environmental “Footprint”
In the United States, it takes 12.2 acres to supply the average person's basic needs; in the
Netherlands, 8 acres; in India, 1 acre. The Dutch ecological footprint covers 15 times the area of the
Netherlands, whereas India's footprint exceeds its area by only about 35%. Most strikingly, if the entire
world lived like North Americans, it would take three planet Earths to support the present world
population. Source: Donella Meadows "Our 'Footprints' Are Treading Too Much Earth, "Charleston
(S.C.) Gazette, April 1, 1996.
Source: Hart, Capitalism at the Crossroads
The Wake-up Call
First recorded photo of
smog in Los Angeles, 1943
“the smell of money”
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Vast clouds of smoke boil into the
sky from the Glendale city dump in
October 1946. Burning garbage in
dumps was a common practice then.
-- From “The Southland's War on Smog: Fifty Years
of Progress Toward Clean Air, ” May 1997
Publication of Silent Spring in 1962
Sustainability Buzzwords
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Environmental management
Corporate social responsibility
Green design
Industrial ecology
Triple bottom line
Shareholder value
Eco-efficiency
Pollution prevention
End-of-pipe
Clean fuel
Cradle to cradle
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Renewable energy
Design for environment
Dematerialization
Sustainable development
Closed-loop supply chain
Biomimicry
Industrial ecology
Life-cycle management
Urban reinvestment
ISO 14001
Brownfield redevelopment
Sustainable Value Framework
Building tomorrow’s opportunity
Nurturing
Internal
Capabilities
Innovation &
repositioning
Growth path
Cost and
risk
reduction
Legitimacy &
reputation
Engaging
External
Constituencies
Managing Today’s Business
Source: Hart, Capitalism at the Crossroads
Historical Evolution
1963 Silent Spring published
Regulation:
Rapid proliferation
End-of-pipe regulation, “pay to reduce -ve impact”
Mandates specific technologies
Focus on hazardous waste, emissions, pollution
Industry:
Compliance focused
Focused on internal manufacturing processes
“Resistant adaptation”
1984 Bhopal tragedy
Historical Evolution
1984 Bhopal tragedy
1987 Brundtland report
“Sustainable development is
development that meets the
needs of the present without
compromising the ability of
future generations to meet
their own needs.”
1989 Exxon Valdez Oil Spill
Industry initiatives
“Beyond compliance”
Regulatory change
- outcome based
- information based
- market based
1992 Rio World Economic Summit
Historical Evolution
1992 Rio World Economic Summit
1995 Brent Spar incident
Strategic view of sustainability
Stakeholder involvement
Alliances with NGOs
Corporate Social Responsibility
International collaboration
Sustainable Value Framework
Tomorrow
Internal
Strategy:
Sustainable Technology
Strategy:
Sustainable Development
Develop sustainable
competencies of the future
Create a shared roadmap for meeting
unmet needs
Corporate Payoff:
Innovation & repositioning
Corporate Payoff:
Growth path
Strategy:
Eco-efficiency
Strategy:
Product Stewardship
Minimize waste
& emissions
Integrate stakeholder views
Into business processes
Corporate Payoff:
Cost & risk reduction
Corporate Payoff:
Reputation and legitimacy
External
Today
Source: Hart, Capitalism at the Crossroads
Sustainability Framework
Tomorrow
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Biomimicry
Renewable energy
Clean technology
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Internal
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Pollution prevention
Waste reduction
Environmental Mgt
ISO 14001
Risk management
End of pipe
Triple-bottom line
Sustainable development
Urban reinvestment
Brownfield development
External
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Today
Life-cycle management
Design for environment
Closed-loop supply chain
Dematerialization
Cradle to cradle
Flow of Course
Fundamentals
Eco-efficiency
Product
Stewardship
Sustainability
Strategy
Environmental
Impact
Pollution
Prevention
Design for
Recovery
Alliances and
Communication
The Role of
Companies
Waste
Reduction
Selling
Services
Product
Differentiation
Core Dilemma:
Tragedy of
the Commons
ISO 14000
Extended
Product
Responsibility
Corporate
Social
Responsibility
Commercial
Returns
Sustainable
Development
The Role of
Legislation
Life-cycle
Analysis
Risk
Mitigation
Concepts
 A historical
perspective
 Framework to classify sustainability
initiatives
 The limits of the win-win argument
 The limits of the shareholder value
argument
Suggested Readings
 Carson,
Silent Spring
 Hart, Capitalism at the Crossroads
 Elkington, Cannibals with Forks
 Frankel, In Earth’s Company

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