Green Business
by Robert Rosen
It was Christmas night. I was contemplating my pile of booty from the day. Yet another tie and pair of socks from my mother, an alarm clock from K Mart that had already lost several hours since Christmas morning, yet another book of obscure aphorisms from my brother, an office pocket dictionary and a not so pocket sized thesaurus, and the only present that I was ever likely to use was an ironing board cover for my oversized ironing board from my girlfriend. As I contemplated the gender issues associated with this last gift, I noticed on her pile of booty, a gift wrapped basket from the Body Shop. On the bottom of the basket was a label which read. "PLU7558 \ 6" basket, 2 fuzzy peach bath beads, orange cream bath oil 50 mls, cocoa butter lotion 50mls, mandarin glyc soap 100g" The basket was wrapped in plastic and the various products sat in a bed of tissue paper.
The Body Shop and its founder Annita Roddick are synonymous in many people's minds with social and environmental corporate responsibility and few would discount the role the significant role the Body Shop has played in increasing corporate and consumer awareness about environmental and third world issues. Yet I wonder about how we can live lightly on this planet, while consuming all those fuzzy little peach bath things. The Body Shop with its eclectic range of body nurturing agents, does not seem to be a match environmentally for a new breed of dedicated Australian retailers like the Cleanhouse Effect and Macro-Wholefoods, with easily accessible bulk buying facilities, products well researched as to their positive or minimal impact on the environment. and very importantly an emphasis on supplying useful and necessary products.
Just how does one actually determine whether a particular company is environmentally responsible? There are no clear definable standards of environmentally responsibility and there is not in Australia any publicly available independent research been done on the relative environmental merits of companies.
In the US a number of Environmental Groups and Socially Responsible Investment Groups have got together to form CERES (Coalition of Environmentally Responsible Economies). CERES has developed a comprehensive set of guiding principles of corporate responsibility named the Valdez Principles, in the hope that they would encourage the development of positive programs designed to prevent environmental disasters and degradation. Companies are asked to endorse and make a long term commitment to comply with the principles. About 50 corporations have so far endorsed the Valdez Principles, including one in the Fortune 500 largest companies in the United States.
In Australia the ACF has developed comprehensive corporate sponsorship guidelines, to help ascertain whether potential sponsors carry out their businesses in a socially and environmentally responsible way. Modelled on questions developed by US socially responsible investment organisation Franklin Research, the environmental section of these guidelines looks at many of the issues detailed in the Valdez Principles and then gives the company in each category a rating from A (excellent) to E (unacceptable). Hopefully within a few years in Australia, we will see the development of a well resourced non-profit research organisation, such as now exist in the US and UK, that can systematically assess the comparative environmental performance of Australian Companies.
The last few years have seen the widespread acceptance of the principle of sustainable development by the business community in most industrialised capitalist economies including Australia. Business communities have largely adopted the Brutland Commission definition of sustainable development, ie Development which meets the needs of the present without compromising the ability of future generations to meet their own needs. While the term Ecologically sustainable development preferred by many environment organisations is far more rigorous, the relatively rapid acceptance of the (be it often vague) concept of sustainable development, by the corporate sector still heralds a major shift in corporate ethics. Less than a decade ago the prevailing corporate view was that the true and only social role of business organisations was to make profits and obey laws. Today corporations worldwide are at least openly acknowledging that they have a far wider level of responsibility to the society as a whole. Corporate rhetoric is of course not always matched with immediate action and some companies see going green as primarily a marketing and public relations exercise rather than acknowledging the Importance of integrating environmental decision making in all aspects of business planning and operations as suggested by Business Council of Australia’s Principles of Environmental Management .
Many industry organisations have like the Business Council of Australia’s drawn up environmental guidelines in recent years. The International Chamber of Commerce Charter on Sustainable Development for example, covers much the same issues as the Valdez Principles but is far less comprehensive. Other organisations in Australia who have environmental policies or principles include the Standards Association, The Australian Manufacturing Council, the Institution of Engineers and even The NSW Coal Association.
There has also been a rapid growth also in the number of companies as well as industry organisations adopting environmental policies. Coopers and Lybrand’s 1992 environmental survey of major Australian companies found that 60 percent of respondents had a formal written environmental policy, an increase of 24% on the previous year. Seventy percent of these policies incorporated measurable environmental objectives, and 88 percent included waste management policies and 86 percent included a commitment to the protection of the atmosphere. This increasing level of environmental awareness in the corporate sector reflects, increasing government environmental regulation, pressure from employees and changing consumer preferences.
Yet are these changes a case of too little too late or is business truly responding to the environmental challenges at hand? Certainly the answer very much depends on one’s own world view. Commonly held views about the role of business can perhaps be put into three categories:
In this view no heroic measures are necessary, the market with appropriate government oversight will take care of most concerns, environmental problems exist but technological developments and strong economic growth will provide the resources to resolve environmental problems as they arise. This is the view of for example the Australian Mining Industry Council, , right wing economic think tanks, and Australian conservative political parties.
- Business as Usual ;
Prompt action is imperative, however problems are ultimately solvable through good management and technology. The goal is clean, equitable economic growth. In many ways this effort is seen as well underway, widespread recycling, pollution control, toxic cleanups, moves towards cleaner production methods and widespread adoption of environmental auditing. Proponents of this view support green taxes, modification of market forces to deal with environmental concerns, and large scale transfer of technology from North to South to prevent environmental degradation in developing countries. This view is becoming more widely held within the corporate sector.
- The Problems are real and serious ;
This view holds that the above measures will not be sufficient. Sustainable global development is only achievable through whole-system change involving the entire world economy and its supporting institutions. Environmental degradation, hunger and poverty and other global dilemmas are seen not as problems to be solved but as symptoms of a far deeper malady. That malady being the basically materialistic and exploitative world view of modern society. In this view the earth is seen as an integrated living system and economic values are given a dramatically reduced role supplanted by humanistic, ecological and spiritual values. Few corporate or even environmental organisations openly express this third viewpoint although many people privately support this view. Organisations that do support this view openly however include the World Business Academy and the Elmwood Institute.
- Fundamental Systems Change Required ;
There has been a rapid shift in awareness in many parts of the world over the last five years with a shift from environmental complacency to a recognition of the need for a further rapid shift in awareness. Over the rest of this decade, what is required is a further rapid shift in awareness, a shift to a realisation that more fundamental and far reaching changes are required to assure ongoing the ecological integrity of Planet Earth. The collapse of Communism in Eastern Europe and the former Soviet Union and emergence of market capitalism in China, makes it very clear that business corporations are the most powerful institutions in the world at this time. It is essential that these organisations truly accept their fundamental responsibility towards the whole of society and the planet.
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