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Ecology and Sustainable Development in Global Business(10)

Dr. Elycheikh / Business Ethics, KIC - Spring 11/12

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Ecological Challenges Ecology

The study of how living things plants and animals interact with one another in an ecosystem

By some measures the demands of human societyhave already exceeded the carrying capacity of theearths ecosystem

Global Commons A commons is a shared resource that a group of

people uses collectively Paradox that if all individuals maximize their own

advantage in short term, commons will be destroyed


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Ecological Challenges Preserving our common ecosystem and assuring its

continued use is a new imperative for business,government, and society

Sustainable development Development that meets the needs of the present

without compromising the ability of futuregenerations to meet their own needs Protecting the environment will require economic

development Economic development must be accomplished sustainably

Sustainable development is an appealing idea but alsoa controversial one


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Threats to the Earths Ecosystem Sustainable development requires that human society

use natural resources at a rate that can be continuedover an indefinite period Renewable resources (water, forests) can be naturally

replenished Nonrenewable resources (fossils fuels like oil, coal) once

used are gone forever

Examples of natural resources that are now being

depleted or polluted at well above sustainable rates Water resources Fossil fuels Arable land


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Forces of Change

Accelerating Ecological Crisis

Pressure on the earths resource base isbecoming increasingly severe

Three critical factors have combined to acceleratethe ecological crisis facing the world communityand to make sustainable development more

difficult Population explosion

World income inequality

Rapid industrialization of many developing nations


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World Population Growth


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World Income Distribution by Deciles (Tenths) of the Population, 2000


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The Earths Carrying Capacity The world resource base is essentially finite, or

bounded

Limits to growth hypothesis suggests humansociety is overshooting earths carrying capacity,

with drastic consequences if changes are notmade


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The Earths Carrying Capacity One method of measuring the Earths carrying

capacity, is called the ecological footprint

The amount of land and water a human populationneeds to produce the resources it consumes and to

absorb its wastes, given prevailing technology


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How Can Human Society Bring the Earth's Carrying Capacity Back

into Balance?

This is without a doubt one of the great challenges facing theworlds people. Any solution will require change on manyfronts:

Technological innovation Develop new technologies toproduce energy, food, and other necessities of human life moreefficiently and with less waste

Changing patters of consumption Individuals andorganizations concerned about environmental impact could

decide to consume less or choose less harmful products andservices

Getting the prices right Some economists have called forpublic policies that impose taxes on environmentally harmfulproducts or activities


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Global Environmental Issues

Ozone depletion A bluish gas, composed of three bonded oxygen atoms, that floats

in a thin layer in the stratosphere between 9 and 28 miles abovethe planet

1974 Scientists chlorofluorocarbons (CFCs) could react with and

destroy ozone 1985 - Scientists discovered a thin spot, or hole, in the ozone layer

over Antarctica 1987 - A group of nations negotiated theMontreal Protocol,

agreeing to cut CFC production, agreement later amended to banCFCs (This is an example of world governments coming togetherto address an environmental threat) As of 2009, 195 countries had signed the protocol

The protective layer will gradually recover if regulatory trendscontinue


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Global Environmental Issues Global warming

Greenhouse effect occurs when carbon dioxide and othergases in the atmosphere prevent heat from escaping into

space Since the Industrial Revolution, the amount of greenhouse

gases in the atmosphere has increased by as much as 25%

Caused mainly by the burning of fossil fuels such as oil and

natural gas If societal emissions of these gases continue to grow

unchecked, the earth could warm by as much as 6.4 degreesCelsius by 2100


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Global Warming


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Causes of Global Warming and Carbon Dioxide

Black carbon the sooty smoke that is created by the incomplete combustion of

diesel engines and wildfires is the second largest contributor to climate

change, responsible for as much as 18 percent of global warming

Deforestation Trees and other plants absorb carbon dioxide and remove it from the

atmosphere; therefore cutting down trees contributes to global

warming

Beef production

Methane, a potent greenhouse gas, is produced as a by-product ofthe digestion of some animals, including cows

CFCs Destroy the ozone and are also considered greenhouse gases


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Global Climate Change Initiatives

Kyoto Protocol

Multination agreement in 1997, went in to effect in 2005

Requires industrial nations to reduce greenhouse gas

emissions 5% below 1990 levels

European Union has taken lead on reducing emissions

As of 2006, 161 nations, representing 62% of worlds carbon

emissions, had ratified

U.S. has not ratified, citing harm to U.S. economy


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More Global Environmental Issues Decline of biodiversity

Refers to the number and variety of species and the rangeof their genetic makeup

Scientists estimate that species extinction is occurring at100 to 1,000 times the normal, background rate due topollution and habitat destruction

A major reason for the decline in the earths biodiversity isthe destruction of rain forests Only half of the original tropical rain forests still stand

Rain forests destruction is ironic because they may have more economicvalue standing than cut


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More Global Environmental Issues

Threats to marine ecosystems

Refers to oceans, salt marshes, lagoons, and tidal

zones that border them, as well as diversecommunities of life they support

Salt water covers 70 percent of the earths surface andsupports many species

Key categories of threats to these ecosystems Fish populations

Coral reefs

Coastal development


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Response of the International Business Community

World Business Council for Sustainable Development

One of leaders in effort to promote sustainable businesspractices

Made up of 200 companies representing more than 35countries and 20 industries Goal to encourage high standards of environmental

management and to promote closer cooperation amongbusinesses, governments, and other organizations concerned

with sustainable development Promotes eco-efficiency and has documented competitive

advantages for companies Those that added the most value with the least use of resources and

pollution were more competitive and environmentally sound


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Voluntary Business Initiatives Life cycle analysis

Involves collecting information on the lifelong environmental impact of aproduct, from extraction of raw material to manufacturing to itsdistribution, use, and ultimate disposal

Industrial ecology

Refers to designing factories and distribution systems as if they were self-contained ecosystems

Extended product responsibility

Companies have a continuing responsibility for the environmental impact of

the products and services, even after they are sold Carbon neutrality

An organization or individual produces net zero emission of greenhousegases; this is usually accomplished by a combination of energy efficienciesand carbon offsets


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Codes of Environmental Conduct Some of the leading universal codes include the following:

Business Charter for Sustainable Development developed bythe International Chamber of Commerce

CERES Principles developed by the Coalition forEnvironmentally Responsible Economies

ISO 14000 a series of voluntary standards developed by theISO, an international group based in Switzerland

Many executives are championing the idea thatcorporations have moral obligations to future generations

Dr Elycheikh / Business Ethics KIC - Spring 11/12

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