How Are Businesses Impacted (And Can Impact) Environment / Society? (28.1)
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Chapter 28, Environmental and Ethical Issues
Learning Objectives: To understand how business activities generate external impacts
Businesses Activity, depending on their sector of the economy, will create different issues to societies and environment. Let's look further into some of the most common negative impacts from business activity:
1. Different Types of Pollution:
- Air Pollution: diseases and impact to environment;
- Land Pollution: landfills or inappropriate disposal can cause diseases and environmental impacts;
- Thermal Pollution: manufacturing exhaust increase air temperature and air-cooled equipment returns high-temperature water damaging the environment and harming wildlife;
- Light Pollution caused by billboards can negatively impact residents sleep and interfere with ecosystems;
- Water Pollution: toxic and chemical liquid disposal damages the environment and cause unhealthy consequences in humans;
- Visual Pollution: simply 'ugly environments' with exposed powerlines, pipelines, overcrowded spaces: minimum to no natural spaces;
- Noise Pollution: peoples' quality of life is impacted by noise from manufacturing, cars, airplanes, etc.
2. Overuse of Energy / Resources:
Overuse of energy is closely related to pollution generation.
However, the overuse of resources and general is a different issue as most of our natural resources are limited and businesses are the main users of such:
- Water, oil, natural gas, coal, and other resources such as:
3. Waste Generation:
Business activity produces enormous amounts of waste which, in most cases, are not or cannot be recycled ending up on landfills, rivers, or nature.
Example: lithium batteries disposal has increasingly been causing fires;
It is also relevant to mention paackaging waste, an important part of the marketing mix.
There are many other impacts of business activity on the environment, here is a summary:
Many governments, therefore have been trying to reduce waste with initiatives based on the 3Rs:
Case Study 28.1 - How Samsung Has Implemented the 3Rs
Businesses are increasingly more concerned with ethical and environmental issues in the last few years. Thisi s due to the risk of bad publicity!
Such businesses came to find out that this environmental/ethical-friedly approach can actually yield positive results or important threats if ignored:
To take advantage of such opportunities and avoid the threats, businesses can take a few actions:
There are both, advantages and disadvantages (co$t$) of acting ethically:
Investment in pollution-reduction machinery is expensive;
Paying higher wages will decrease profits;
Installation of solar panels will have a high initial investment.
However, in the long-term, acting ethically may pay off. Ethical businesses enjoy of many obvious advantages:
Case Study 28.4 - Fast Fashion
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