DEVELOPMENT
Manureet Riar*
Nidhi Grover **
The world is now confronted with the challenge of optimizing the use of the
currently available resources in a way to meet the needs of the present generation without
sustainable development is the need of the hour. The needs for efficient use of resources
and environment friendly corporate policies and behaviors have now been recognized all
over. Corporations have the ethical responsibilities to become a more active partner in
dealing with social concerns. Businesses must creatively find ways to become a part of
the solutions rather than being part of the problems. Corporations must develop an
This paper discusses various concepts that the businesses must adopt in order to
Charter for Sustainable Development have also been discussed. Benefits of these
principles to corporate are also mentioned. Relevant literature has been reviewed.
*
Research Scholar at GNDU, Amritsar
**
Junior Research Fellow at GNDU, Amritsar
INTRODUCTION
This is the century of the economic boom. There is a hurry to reap as many
benefits in as little time as possible. All the demands of developing and developed
nations require the manipulation of natural resources. No economy can survive without
coal, petroleum, electricity, wood and steel. Industries cannot run until they are fed these
precious and stealthily depleting resources. It is in demanding times like the present that
the world has become aware of how these resources are fast depleting. If these resources
are not utilized efficiently, soon a day will come when our future generations will not
even have drinking water, let alone all the other facilities we take for granted.
Nowadays, several well established environmental trends are shaping our future
person, shrinking forests, and the loss of plants and animal species. First, world
population grew by 3.7 billion in the past 50 years with 2% of the world average annual
birth rate (Potts, 2007). At this birth rate the world population is expected to reach
approximately 9 billion in the next 50 years (Gilland, 2006). The second trend affecting
the entire world is a temperature rise caused by the increasing atmospheric concentrations
of carbon dioxide. As a result, the modest temperature rise phenomenon is melting ice
caps and glaciers. Third, the world wide shrinkage in cropland per person is making it
more difficult to feed the growing population adequately over the next few decades and
to satisfy the demand for food over the next half century. Fourth, human demands
devastate the forests resulting in deforestation. Over the past half century, the world’s
forested area has shrunk substantially, with much of the loss occurring in developing
countries. Finally, the irreversible trend that will affect the human prospect most is the
accelerating extinction of plant and animal species. The leading cause of species loss is
habitat destruction, followed by the habitat alterations due to rise in temperatures and
environmental pollution. As more and more species disappear, local ecosystems begin to
collapse. In the near future, humanity will face wholesale ecosystem collapse (Brown,
2000).
rivers and lakes are dirty and our air is unclean. The planet is warming and its protective
ozone is depleting gradually. Lush forests are disappearing along with countless species
of plants and animals. As the world population has multiplied, most of the world’s
wetlands have disappeared. The dry land is in danger of turning into deserts, and
groundwater is facing serious depletion. As a result, the Earth is losing its capacity to
provide the continuous supply of food necessary for our survival, threatening our
sustainable social and economic forms of behaviour in the industrial and developing
countries have come increasingly to the forefront of scientific interest and of public
various legislative bodies, are the subject of important publications, and in the minds of
many people present the most urgent challenge facing human kind.
The world is now confronted with the challenge of optimizing the use of the
currently available resources in a way to meet the needs of the present generation without
compromising on the requirements of the future generation. To add to this, now it is also
imperative that our fragile environment suffers the least damage possible. In more
evolving, which makes it doubly difficult to define. One of the original descriptions of
development is development that meets the needs of the present without compromising
the ability of future generations to meet their own needs" (World Commission on
thought to have three components: environment, society, and economy. The well being of
these three areas is intertwined, not separate. For example, a healthy, prosperous society
relies on a healthy environment to provide food and resources, safe drinking water, and
clean air for its citizens. The sustainability paradigm rejects the contention that casualties
in the environmental and social realms are inevitable and acceptable consequences of
It has become quite clear that environmental problems are substantial, and the
regulation, which often inhibits growth. The result can be a trade-off between a healthy
environment on the one hand and healthy growth on the other. As a consequence,
opportunities for business may be constrained. However, there are some forms of
development that are both environmentally and socially sustainable. They lead not to a
trade-off but to an improved environment, together with development that does not draw
down our environmental capital. This is what sustainable development is all about- a
The business that has maximized the profit, i.e., it has an excellent economic
that business has three issues to face: ‘what it takes’, ‘what it makes’, ‘what it wastes’.
‘What it takes’ is natural materials and resources from Earth’s ecosystem through mining,
extracting, growing, hunting and other such like things. ‘What it makes’ is products
derived from above resources through industrial processes. ‘What it wastes’ is not only in
The needs for efficient use of resources and environment friendly corporate
policies and behaviors have now been recognized all over. The performance of an
enterprise can no longer be evaluated on the basis of economic parameter alone and it
needs to be integrated with environmental performance also. (Saxena et al., 2003). Thus,
commitment and action on the part of companies. This calls for the businesses for new
thinking and strategies regarding environment, Correlated with the impact of businesses
Growing income has allowed people to expand their consumption. The greater
poverty in many nations. However, the high consumption of the world’s affluent
consumers can have a negative impact on ecosystems disproportionate to their numbers.
Today’s model of intensive use of raw materials and resources undermines ecosystem
functions and runs the risk of overwhelming the planet’s capacity to absorb wastes.
Meeting the needs and desires of all people while preserving resources require innovation
of new technology and business models. Business can lower the resource intensity of the
production of consumer goods, while improving their top and bottom lines and meeting
consumer demand with sustainable products and services. Consumers themselves can
drive change by favoring companies that produce goods and services to protect, conserve,
developers of environmentally safer materials and processes, firms that invest in eco-
efficiency, and those that engage themselves in social well-being. These enterprises will
generally have a competitive advantage. They will earn their local community’s goodwill
and see their efforts reflected in the bottom line. Corporations have the ethical
Businesses must creatively find ways to become a part of the solutions rather than being
and processes of a business. Following are the few concepts that should be considered by
In a market transaction, the profit of product or service is price minus the cost. When a
person buys the price he pays reflects perceived value or benefit he receives in relation to
price and from seller’s point of view when the perceived value is higher than the cost,
profit is produced. But this simple equation does not include eco-costs. If eco-costs are
included then the signals from market will respond accordingly and we would have
moved towards our goal of maintaining integrity and sustainability of environment. For
over the product life cycle. Life-cycle costing attaches a monetary figure to every
ecological impact of a product – disposal costs, legal fees, liability for product harm, loss
of environmental quality, and so on. Product development decisions are then based not
only upon projected cash flows but also projected future costs associated with each
marketing have to use full cost accounting practice so that eco-costs are internalized in
the prices of the product. This would mean that costs would increase and it would
adversely affect the profit maximization goal of the corporations, which in turn will affect
the shareholders interest. Then the company will have to minimize the costs incurred on
labour, raw materials and other inputs. The cost reduction is possible if investment in new
and clean technologies is made. This would result in efficient product solutions and at the
behavior through market signals rather than through explicit directives. (Stavins, 2000).
In Market Based Instruments, the market price is charged for a product or service for
which otherwise no market price exists as for example, for gaseous emissions, or if the
price exists, it is changed to reflect its impact on environment. MBI’s mentioned in the
literature are:
i. Subsidies for the companies or industrial sectors that shift to clean technologies,
resources.
ii. Incentive for those (companies and entrepreneurs) who incur additional costs in
or resource depletion.
The other aspect of market – environment relationship is command and control method.
In this method a policy framework exists that mandates compliance to certain standards
laid down by the regulatory authorities. These controls mechanism go to the extent of
mining/extracting.
GREEN MARKETING:
Green marketing is a response to demand for ecologically sound products like recycled
must satisfy two objectives: improved environmental quality and customer satisfaction.
(i) the production process is compatible with ecosystem (ii) it is compatible with
the goals of the company (iii) it satisfies the customers. Some of the
New Delhi, capital of India, was being polluted at a very fast pace until
Supreme Court of India forced a change to alternative fuels. In 2002, a directive was
issued to completely adopt CNG in all public transport systems to curb pollution
efficient products and services and institute energy-efficient operating practices in its
facilities worldwide.
ECO – LABELLING:
of eco-labels. Eco-labelling aims to identify and promote products that have a reduced
environmental impact when compared to other similar products. (Gertz, 2005). The
when it relates to human health. There is a growing demand for goods and services that
cause less damage both to the health of human and environment. The consumer in
developing countries too is showing great interest and concern on the environmental
effects of products and services. This in turn affects the purchasing behavior. In
sustainable development. This concern has led the governments especially in the
countries of North to formulate guidelines that regulate sales and trades. In fact, ‘green
shopping’ is now becoming popular in these countries. Eco-labelling can lead to:
iii. Consumer’s awareness that their choice of products do affect the environment, as
awareness in respect of environment friendly products. The aims of the scheme are to
encourage the consumer to purchase those products which have less harmful environment
impact.
REVIEW OF LITERATURE
Andersen (1994) pointed out that the traditional way of controlling pollution in Western
Europe has been regulation by the use of standards (the command-and control approach).
It tends to force all businesses to adopt the same measures and practices of pollution
control and thus accept identical shares of the pollution control burden regardless of their
relative impacts. Among environmental researchers and policy makers, there is a growing
improvement is progressing too slowly and, in some situations, is leading to even further
deterioration of the environment. This has motivated policy makers to search for other
instruments such as green taxation. Throughout Europe, academics and policy makers are
Tilt (1994) studied the Corporate Environmental Policies (CEPs) and examined the level
were developing objectives and policies for environmental accounting and reporting.
They are not however, referred to very often in the annual report or any other media. In
the study of annual reports, it was found that most commonly included disclosure
37 percent discussed their environmental management plan. Environmental law was also
energy and natural resource conservation and renewal by reducing use of energy
and virgin materials through product redesign, making greater use of renewable
countries. Corporations can play an important role in educating people about the
Okafor et. Al., (2008), focused on environmental degradation and the need for corporate
organizations to fulfill their social responsibilities. Using the systems theory, the
examined. The organizations are open systems, which receive inputs or energy from their
environment, convert these resources into outputs into their environment. It is also argued
that organizations must not merely produce products and services to satisfy their
numerous clients, they must also produce actions that will ensure the protection of the
SUSTAINABLE DEVLOPMENT
Business firms play a key role in the issues of environmental protection since they
are part of our society and cannot be isolated from the environment. Based on their
abundant expertise and capital resources, corporations could improve our environment
and create a better quality of life. Instead, they could try to solve at least some
Corporations could adopt the applications of innovative technology and the strategic
and as such cost-intensive matter, these factors all play a role in it:
• Precautions and preventive measures to ensure safety during the transport and
• Preventive measures for dealing effectively with accidents during production and
transport;
• Continuous review of the status quo through environment and safety audits.
Development and Business Charter for Sustainable Development identified sixteen key
sustainable manner.
internationally.
undue environmental impacts and are safe in their intended use, that are efficient in
their consumption of energy and natural resources, and can be recycled, reused, or
disposed safely.
and the public in the safe use, transportation, storage, and disposal of products
8. Facilities and Operations: To develop, design, and operate facilities and conduct
activities, taking into consideration the efficient use of energy and materials, the
impact and waste generation, and the safe and responsible disposal of residual waste.
materials, products, processes, emissions, and wastes associated with the enterprise
requiring improvements in their practices to make them consistent with those of the
impacts.
technology and management methods throughout the industrial and public sectors.
15. Openness to Concerns: To foster openness and dialogue with employees and the
public, anticipating and responding to their concerns about the potential hazards and
or global significance.
appropriate information to the board of directors, the shareholders, the employees, the
The compliance of the corporations with these principles will help the world achieve
BENEFITS TO CORPORATIONS:
5. Ecological sustainability offers the potential for reducing long term risks
term issues early, companies can become aware of and manage these risks.
curve. These strategies give companies a firmer legal footing and may allow
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