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How Can Businesses Create Value in Society?

To understand the value that businesses can create in society it would be necessary to
understand what is business, society, and value. A Business, also known as an enterprise,
company, or firm, is involved in the provision of goods and services to society. It can be
engaged in commercial, professional, or industrial activities, and this could be for a profit
entity or a non - profit organisation. Society surrounds us and we are all part of it.
ERICKSON. M et al (2009). Business in Society. Cambridge: Polity Press, noted that
everything in our world from I-Pods to cemeteries, coal mines to call centres is part of
society too. We are all involved in constructing, through our actions the society that
surrounds us. He went further to explain that as society is constantly adapting it also has
significant effects upon us as, as individuals, how we think about the world, how we
imagine ourselves, how we understand our role within it, and how we make ourselves
understood by others. Society and business are interrelated, the world of work and business
is structured by social forces external to it, and it is in turn responsible for structuring much
of the society that surrounds it. (Ibid). Without society, businesses could not function, there
would be no consumers, workers, investors, or shareholders. The stakeholders which are so
important, would not be accessible (Please see Appendix 1 Business Stakeholders, page 9).
Without stakeholders, the business would be an empty vacuum, as it is society itself which
construct the formation of enterprises.
Value and creating value is dependent on the relevant societal typology in which we reside
and operate. The meaning of value is different in economics or business, in relation to the
meaning of value in society. Value in economics refers to the price and quality of a product or
service. Value in society accounts for the stability of social conduct and is an important part
of the culture. This is further explained by MONDAL. P (2016) (The Meaning and Functions
of Social Values. (Online) yourarticlelibrary.com. Available from:
http://www.yourarticlelibrary.com/sociology/the-meaning-and-functions-of-social-values-
sociology/8522/. (Accessed n.d/2016), where he states that, Values such as fundamental
rights, patriotism, respect for human dignity, rationality, sacrifice, individuality, equality,
democracy etc. guide our behaviour in many ways. Values are the criteria people use in
assessing their daily lives; arrange their priorities and choosing between alternative course of
action. Leslie. G. R et al quoted by Mondal.P (2016) refers to value as group conceptions
of the relative desirability of things. Haramlambos. M quoted by MONDAL. P (2016) noted
that value is a belief that something is good and worthwhile. It defines what is worth having
and worth striving. So, MONDAL. P (2016) summarizes by concluding that something of
value will have a measure of goodness or desirability.
For businesses to create value in society, there is some relevance in understanding what is
considered as the current structure and typology of our society. ERICKSON. M et al (2009)
explained that many of the ways in which societies have been typologized relate to work or
to economic activities more generally. Society has evolved from the traditional pre -
nineteenth century, where value was placed on small scale self- sufficient farming and feudal
systems. Value in society was then based around the first 2 levels of Maslows Hierarchy of
Human Needs (see Appendix 2 Maslows Hierarchy of Human Needs, page 10), but value
was limited due to the concept of habitus, which determines people as having a shared set of
values and attitudes depending on the class positions people occupy. Per Marx, as noted by

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ERICKSON. M et al (2009), modern society is characterized by conflict between two

competing social classes, those who own the means of production (business owners) and
those who do not (the workers). This class consciousness (ibid) leads to individuals
having specific ways of living in, understanding and seeing the society that surrounds them:
these characteristics are shared with other members of their social class. (ibid). This could
then lead to a possible divide in what is accepted as value.
Our current society has adapted and evolved in the business sense, to now be typologized as
not only a capitalist, but also possibly post industrial. The post industrial society is
societys pursuit of knowledge rather than production and can be characterized by: increase
in the provision of services, manual work declines, and attempts to harness and control new
types of technologies, which then change the nature of business. The capitalist society is
focused on the value of succeeding through the profit originating from business. Per Zygmunt
Bauman (1998:2000, cited by ERICKSON. M et al (2009)], we lead liquid lives as we
struggle to adapt to the constantly changing social and geographical mobility. This has led to
society producing victims of a new phase of capitalism, in which capital relates to people as
consumers, not producers. If you cannot buy things you are socially redundant. Value is now
placed on the rampant form of consumerism (ibid) produced by businesses, but the
goodness and desirability of consumerism is currently unbalanced, with desirability being
more valuable than the goodness for society. This could cause the divide between the class
consciousness as consumerism is now shaping our identities more than our occupations and
jobs (ibid)
The post industrial era has been achieved through societys influence on business.
Movements such as feminism and LGBT, have ensured that equality in the workplace have
now become a legal requirement. With more businesses following, the trickle- down effect
has encompassed all sections of society leading to greater acceptance and an increased need
for diversity. This diversity has led to more value being placed on innovations and creativity
to keep businesses current and competitive. This placement of value by the businesses have
led to many businesses following Corporate Social Responsibility or CSR (see Appendix 3
Corporate Social Responsibility, page 11). The CSR for each business promotes value for
society, as the businesses promise to invest responsibly in their workforce, invest in the
community through sponsorships and philanthropy, and invest in the company to make the
business sustainable.
As value, is something desirable or good, the rampant form of consumerism (ibid) could
fulfill the objective of value created by businesses for society. Society wants value in their
lives, this has led to an increase in the need for: new technology, current fashion, exotic travel
and modern homes. These values, provided by the businesses, have given a broader freedom
of choice and made lives and living easier. But this ease is unequal as 20% of the worlds
people in the highest-income countries account for 86% of total private consumption
expenditures the poorest 20% a minuscule 1.3% [Global Issues.org. (2014) Consumption
and consumerism. (Online) Global Issues.org. Available from:
http://www.globalissues.org/issue/235/consumption-and-consumerism (Accessed
05/01/2014)]. Whereas society has used movements to influence changes within businesses,
businesses have used media to influence changes towards what societys views now as value.
The vast reaching power of the media and its influence is explained in Appendix 6 Media
Moguls, page 14. Noam Chomskys Propaganda model (See Appendix 4 Chomskys Media

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propaganda model, page 12) explains how the media manufactures consent (Appendix 5
Workings of the Propaganda Model, page 13). This consent is ultimately manufactured value,
from the advertised implicit importance of owning a racing gas guzzling Mercedes Benz,
which would reveal your identity as a winner with wealth and elegance, to the advertised
explicit media message, of the negativities associated within current fashion towards larger
body structures, as opposed to implicitly supported starved body images. This shows that
there is an underlying system that promotes certain types of consumption but not other
types, this promotion is based in the typology of society and culture which has been
manufactured through the media. [Global Issues.org (2014)] The manufactured values in
society by the businesses, through the media, limits the information regarding the goodness
but extends the desirability. This limit has potentially increased societys consumerism, which
in turn has increased societys need for energy.
Of all the industries within society it is arguably the businesses within the Energy sector
which could bring the biggest value to society. Businesses require different types of energy
sources; the current energy sources can be separated into renewable and non-renewable.
(Please see Appendix 8 Renewable and Non Renewable energy sources in relation to
industry usage, page 16.) Consumerism has directly increased the need for energy within all
parts of the economy. But the consumption of energy can be quantified within 3 areas: the
manufacturing industry, transportation and the building sector. The manufacturing industry
has grown exponentially in third world countries due to the increase in consumer demand and
cheaper resources such as labour and materials. The global industrial sector is the largest
energy-consuming end-use sector and is projected to increase by an average of 1.2%/ year.
Most of the long-term industrial sector energy growth occurs in non-OECD countries and
and it is predicted to rise [EIA.gov. (2016) International Energy Outlook. (Online) EIA.gov.
Available from: http://www.eia.gov/outlooks/ieo/pdf/0484(2016).pdf. (Accessed
n.d/05/2016)]
None OECD countries refers to the countries which are non - members of the Organization
for Economic Cooperation and Development. These Non members are separated into five
separate regional subgroups non-OECD Europe and Eurasia (which includes Russia); non-
OECD Asia (which includes China and India); Middle East; Africa; and non-OECD Americas
(which includes Brazil). OECD Members are grouped into three basic country groupings
OECD Americas (United States, Canada, and Mexico/Chile), OECD Europe, and OECD
Asia (Japan, South Korea, and Australia/New Zealand.

Energy use in the transportation sector includes the energy consumed in moving people and
goods by road, rail, air, water, and pipeline. The report goes further to state that Virtually
all (94%) of the growth in transportation energy use occurs in the developing, non-OECD
economies. Continuing economic growth leads to rising standards of living that result in
demand for personal travel and freight transport to meet growing consumer demand for goods
in non-OECD nations. But the demand for energy consumption in the OECD countries
declines due to the combination of well-established consuming patterns, comparatively slow
economic and population growth rates, and vehicle efficiency improvements. Transportation
energy consumption covers all the major energy types apart from coal. (See Appendix 7 -
World transportation sector delivered energy consumption by energy source, page 15)

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The Buildings sector which consists of residential and commercial end users, accounts for
20% of the total delivered energy consumed worldwide. (Ibid) In the Non OECD
residential energy use will increase by 2.1% per year. This is due to the result of strong
economic growth and rising standards of living (Ibid). The value that has been created by
businesses within the energy industry can be equated to a higher standard of living for the
Third World countries, and as their economies grow this allows them to consume more to
make their lives easier, safer and healthier. In the OECD countries, although energy
consumption is not as fast or as high as the Non - OECD, we are still consuming at a high
rate and are using the high - energy consumption of the Non - OECD to provide the goods
or services for our consumption.

Although the value in regards to a higher and better standard of living is a necessity, this
value has come at the tremendous cost of higher levels of environmental degradation.
Environmental degradation refers to high levels of waste in landfills, water pollutants, high
levels of carbon dioxide emissions due to energy consumption and the constant mining of
natural resources. This rampant consumerism is not sustainable. Non renewable energy
sources are running out, and the burning of fossil fuels is causing an increase in global
warming. Global warming has led to climate change, climate scientists agree: climate
change is happening here and now. Based on well - established evidence, about 97 percent of
climate scientists have concluded that human caused climate change is happening Klein. N
(2014) This Changes Everything. St Ives: Clays Ltd. Sustainability is now referenced in
almost all business CSR, without sustainability within the environment, businesses would be
unable to function as there would be a shortage of resources. This shortage would not only
effect the businesses, but also effect the creation of value in society. But that value which
would be effected is only within the same current class consciousness, typology and media
propaganda. The creation of real value by businesses would be to ensure that the message of
desirability and goodness relates to the end of environmental degradation. This should be
what is understood by sustainability within the CSR of a business, but, as noted by The
Guardian, Until corporations start being fully transparent about the full costs they impose on
the environment much of the talk about creating sustainable business will remain just
talk. [The Guardian (2014). Sustainability is impossible until companies admit
environmental cost. (Online) The Guardian. Available from:
https://www.theguardian.com/sustainable-business/blog/sustainability-companies-
environmental-cost. (Accessed 13/01/2014)]

Government energy sustainability legislation, within the UK, has focused on energy
efficiency in buildings, where the focus was to reduce carbon emissions from buildings and
make sure that planning policies help to protect and improve the natural and built
environment. [Gov.uk (2015). 2010 to 2015 government policy: energy efficiency in
buildings. (Online) Gov.uk. Available from:
https://www.gov.uk/government/publications/2010-to-2015-government-policy-energy-
efficiency-in-buildings/2010-to-2015-government-policy-energy-efficiency-in-buildings.
(Accessed 08/05/2015)]. But, included in the zero - carbon emissions policy was the
voluntary, not mandatory code for ensuring that buildings have a sustainable design, as it is
noted that The code is voluntary, and we do not intend to make it mandatory (Ibid). Further
on the website there was a link for the breakdown of the cost of building a house to the
mandatory code but Following the technical housing standards review, the government has

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withdrawn the code for sustainable homes (Ibid). What could be more disruptive to energy
sustainability is the recent article in The Guardian, which notes that More than 1bn of
future investment in renewable energy projects disappeared over the course of 2016, the
Green Alliance found when it analysed the governments latest pipeline of major
infrastructure plans and further states that Investment in wind, solar, biomass power and
waste-to-energy projects will decline by 95% between 2017 and 2020. [ The Guardian.
(2017) Renewables investment in UK will fall 95% over next three years study. (Online)
The Guardian. Available from:
https://www.theguardian.com/environment/2017/jan/04/renewables-investment-uk-fall-95-
percent-three-years-study-subsidy-cuts-emissions-targets. (Accessed 04/01/2017)]. Although
further reading does stipulate that the government had managed to cut 2bn from the cost of
decommissioning old nuclear power plants. The think-tank said that was good news as it
could free up money to spend on encouraging people to switch to lower carbon heating and
that the Office for Budget Responsibility recently projected that 8.4bn will be spent on
renewable projects in the UK in 2020/21 (Ibid). The Think tank quoted was The Green
Alliance, which was quoted in the article as saying that Renewables will be cheaper than
new fossil power stations by 2025 at the latest if we allow companies to build, learn, and cut
their costs. But the government has been holding back the final bit of support needed to make
renewables subsidy free. Its also blocked the cheapest renewables from being built. (Ibid)
The UK Government is in favour of potentially more expensive alternatives such as shale
gas and nuclear power. [ The Guardian. (2016). UK's attractiveness for renewables
investment plummets to all-time low. (Online) The Guardian. Available from:
https://www.theguardian.com/environment/2016/may/10/uks-attractiveness-for-renewables-
investment-plummets-to-all-time-low. (Accessed 10/05/2016)]

Without the attractiveness in renewable investment, businesses could decide to fall back on
non - renewable options and focus less on sustainability, as their profit margin could decrease
if returns on investments are not realised. But, Virgin, is one major conglomerate who is still
investing in renewable energy, and they launched a new initiative known as Gaia capitalism,
where Virgin pledged to spend roughly $3 billion in the next decade to develop bio fuels as
an alternative to oil and gas, and on other technologies to battle climate change [ Klein. N
(2014)] Branson pledged that Virgin would divert profits generated from Virgins fossil
fuelled transportation lines back into research towards Gaia Capitalism. If many other major
conglomerates could do the same or if Government legislation could encompass the same
strategy, whereby profits being earned from warming the planet be channelled into the costly
transition away from these dangerous energy sources (Ibid), then renewable energy
consumption could soon be the only energy consumption being utilised. But Gaia Capitalism
was explained by Branson as helping Virgin to make a real difference in the next decade and
not be ashamed to make money at the same time (Ibid), and it is the value of a business
bottom line, not carbon footprint (Ibid) that is causing the ongoing battle between
sustainability and the economy. Bransons early green investment initiative appears to have
lost its stride with the influx of natural gas, and he stated that Its increasingly clear that this
is a question of creating the market conditions that would allow a diverse portfolio of
different renewable fuel producers, suppliers and customers to all work in the same way that
conventional fuel supply chains work today. (Ibid). The value for businesses in energy
sustainability is creating market conditions such as the investment opportunities and subsidies

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that were once abundant in the UK. This creation would also provide value for society in the
form of jobs and less environmental degradation.

But the uphill struggle for Government legislation and corporation action has been taken on
by Non- Governmental organisations, such as The National Resources Defence Council
(NRDC), Greenpeace, and the World Resources Institute. These NGOs and others, focus on
renewable and sustainable energy sources and create value in society by providing
movements to stop or change Government and corporate mentality towards sustainability.
These organisations encourage the Circular Economy of sustainability, (See Appendix 9
The Circular Economy, page17) which supports an economy that is restorative and
regenerative by design, and which aims to keep products, components and materials at their
highest utility and value at all times, distinguishing between technical and biological cycles [
Ellenmacarthurfoundation.org. (2015). Circular Economy. (Online),
Ellenmacarthurfoundation.org. Available from:
https://www.ellenmacarthurfoundation.org/circular-economy. (Accessed n.d/2015)] But, apart
from Greenpeace, the other two, are rarely if ever mentioned in the media. If the circular
economy was implemented by businesses, society would benefit greatly due to the decrease
in environmental degradation through energy consumption in waste disposal and
manufacturing. This circular model could help alleviate the current consumer orientated
class consciousness, if supported by the media, government, energy corporations and other
businesses. There are also still more renewable energy sources that have yet to be tapped
(please see Appendix 10 Most unusual Renewable energy sources, page 18), although in the
case of human excrement it is already being utilised as energy in several countries. The Mail
Online referred to an article in New Scientist about a water treatment plant in Denmark, that
is generating so much excess electricity that the surplus is being used to pump drinking water
around the city [ Mail Online. (2017). The Danish City Powered by Poo. (Online) Mail
Online. Available from: http://www.dailymail.co.uk/sciencetech/article-3991142/The-Danish-
city-powered-POO-Aarhus-burns-sewage-waste-provide-fresh-water-citizens.html. (Accessed
05/01/2017)]

There are numerous examples of increases in technology which could eventually enable
society to be self- sufficient in regards to energy without causing global warming. Spray on
solar cells have been invented and these new cells are made from a new plastic which could
allow up to 30 percent of the sun's radiant energy to be harnessed, compared to 6 percent in
today's best plastic solar cells. (Nationalgeographic.com. (2005). Spray-On Solar-Power
Cells Are True Breakthrough. (Online) National Geographic.com. Available from:
http://news.nationalgeographic.com/news/2005/01/0114_050114_solarplastic.html.
(Accessed 14/01/2005). The article goes further to note that If we could cover 0.1 percent of
the Earth's surface with [very efficient] large-area solar cells, we could in principle replace all
of our energy habits with a source of power which is clean and renewable." (Ibid). These
plastic, spray - on solar cells have also reduced the cost of solar installation making it
extremely viable. The Guardian published an article in December last year about Normandy,
in France, being the first city to pave 1 km worth of road with Solar panels in a two- year test
run. But the cost of these panels could be prohibitive. Many of the major energy companies
have renewable alternatives as well as help on their websites to lower carbon emissions for
both business and residential use. British Gas has a renewable energy tab centred towards
businesses and offer to help businesses reduce costs and carbon emissions by producing

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sustainable energy. British Gas.co.uk. (2016) Renewable Energy. (Online) Available from:
https://www.britishgas.co.uk/business/gas-and-electricity/renewable-energy. (Accessed
nd/2016)].

Businesses are creating value in society, by offering alternatives to non - renewable energy,
but as Branson mentioned, this is a question of creating the market conditions. Without
these market conditions, businesses will be slow to change their capitalistic ways and
Governments will be loath to legislate and upset the businesses that fund their investment
needs. But the value is there and is already being utilised by society.

References

British Gas.co.uk. (2016) Renewable Energy. (Online) Available from:

https://www.britishgas.co.uk/business/gas-and-electricity/renewable-energy. (Accessed
nd/2016)].

EIA.gov. (2016) International Energy Outlook. (Online) EIA.gov. Available from:

http://www.eia.gov/outlooks/ieo/pdf/0484(2016).pdf. (Accessed n.d/05/2016)

Ellenmacarthurfoundation.org. (2015). Circular Economy. (Online),

Ellenmacarthurfoundation.org. Available from:
https://www.ellenmacarthurfoundation.org/circular-economy. (Accessed n.d/2015)

ERICKSON. M et al (2009). Business in Society. Cambridge: Polity Press

Global Issues.org. (2014) Consumption and consumerism. (Online) Global Issues.org.

Available from: http://www.globalissues.org/issue/235/consumption-and-consumerism
(Accessed 05/01/2014)

Gov.uk (2015). 2010 to 2015 government policy: energy efficiency in buildings. (Online)
Gov.uk. Available from: https://www.gov.uk/government/publications/2010-to-2015-
government-policy-energy-efficiency-in-buildings/2010-to-2015-government-policy-energy-
efficiency-in-buildings. (Accessed 08/05/2015)

The Guardian (2014). Sustainability is impossible until companies admit environmental cost.
(Online) The Guardian. Available from: https://www.theguardian.com/sustainable-
business/blog/sustainability-companies-environmental-cost. (Accessed 13/01/2014)

The Guardian. (2017) Renewables investment in UK will fall 95% over next three years
study. (Online) The Guardian. Available from:
https://www.theguardian.com/environment/2017/jan/04/renewables-investment-uk-fall-95-
percent-three-years-study-subsidy-cuts-emissions-targets. (Accessed 04/01/2017)

The Guardian. (2016). UK's attractiveness for renewables investment plummets to all-time
low. (Online) The Guardian. Available from:
https://www.theguardian.com/environment/2016/may/10/uks-attractiveness-for-renewables-
investment-plummets-to-all-time-low. (Accessed 10/05/2016)

Klein. N (2014) This Changes Everything. St Ives: Clays Ltd

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Mail Online. (2017). The Danish City Powered by Poo. (Online) Mail Online. Available
from: http://www.dailymail.co.uk/sciencetech/article-3991142/The-Danish-city-powered-
POO-Aarhus-burns-sewage-waste-provide-fresh-water-citizens.html. (Accessed 05/01/2017)

MONDAL. P (2016) (The Meaning and Functions of Social Values. (Online)

yourarticlelibrary.com. Available from: http://www.yourarticlelibrary.com/sociology/the-
meaning-and-functions-of-social-values-sociology/8522/. (Accessed n.d/2016)

Nationalgeographic.com. (2005). Spray-On Solar-Power Cells Are True Breakthrough.

(Online) National Geographic.com. Available from:
http://news.nationalgeographic.com/news/2005/01/0114_050114_solarplastic.html.
(Accessed 14/01/2005)

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Appendices
Appendix 1 - Business Stakeholders

https://www.professionalacademy.com/media/images/Segemented-Stakeholder-Map.jpeg

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Appendix 2 Maslows Hierarchy of needs

http://www.consciousaging.com/Images/Maslow's%20Hierarchy%20of%20Needs.jpg

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Appendix 3 Corporate Social Responsibility

https://www.bing.com/images/search?
q=iMAGES+advantages+and+disadvantages+of+behavioral+management+thought&view=d
etailv2&id=161A50A0A10F7CC614DBD882C5E0D8474F42AB82&selectedindex=118&cc
id=H3BS7u2P&simid=608034428226046033&thid=OIP.M1f7052eeed8f2e1af8300df5569ce
453o0&mode=overlay&first=1

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Appendix 4 Chomskys Media Propaganda Model

http://whatsupic.com/images/whatsupicen1/14442784007.jpg

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Appendix 5 Workings of the Propaganda Model

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Appendix 6 Media Moguls

https://www.bing.com/images/search?
q=image+chomskis+propaganda+model&view=detailv2&qpvt=image+chomskis+propagand
a+model&id=4878CE135CCD3C22C988BD2467CD22140A5B94E9&selectedindex=4&cci
d=fdQesQFu&simid=608050006133048848&thid=OIP.M7dd41eb1016e0934f6bf330f553e7
4bdo0&mode=overlay&first=1

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Appendix 7 - World transportation sector delivered energy consumption by energy source

http://www.eia.gov/outlooks/ieo/exec_summ.cfm

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Appendix 8 Renewable and Non-renewable energy sources

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maintenance/Illustrations-manufacturing-maintenance-US-Energy-Consumption-By-Source-
Sample.png

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Appendix 9 The Circular Economy

https://www.ellenmacarthurfoundation.org/circular-economy/interactive-diagram

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Appendix 10 Most unusual renewable energy sources

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