Textbook- CH 14

• Businesses' responsibilities toward the environment are extensive and confront virtually all aspects of the corporation
• Environmental issues for businesses

  • Input of resources
  • Manufacturing process
  • Workplace conditions
  • Product packaging and sales
• Major environmental concerns


  • Acid rain
  • Air pollution
  • Ecosystems
  • Energy production and consumption
  • Nature and wildlife
  • Ozone
  • Pollution
  • Waste management
  • Water quality
• Environmental ethic


  The set of values or principles that govern a corporation's practices relating to the environment
• Sustainable development


  Development ensuring that the use of resources and the impact on the environment today does not damage prospects for the use of resources or the environment by future generations
• Business sustainable development


  Adopting business strategies and activities that meet the needs of the enterprise and its stakeholders today while protecting, sustaining, and enhancing the human and natural resources that will be needed in the future
• The environmental ethic and sustainable development are two concepts that aid business and society in understanding the environmental challenges
• Corporations tend to use rule-based and utilitarian approaches to describe environmental decisions, while stakeholders evaluate the decisions based on virtue ethics
• Ozone layer


  Protects Earth by filtering out ultraviolet (UV) radiation from the sun
• Thinning of the ozone layer in the upper atmosphere has resulted in increased UV radiation
• Pollution


  Any form of contamination in the environment
• Business is under pressure to reduce its polluting of the environment
• Waste management


  Disposal, processing, controlling, recycling and reusing the solid, liquid, and gaseous wastes of plants, animals, humans and other organisms
• Wastes often are hazardous, making the waste management process more challenging
• Recycling


  Reduce, reuse, recycle, and recover
• Water quality


  Determined by the presence of contaminants affecting its chemical and bacterial composition
• Supply of safe drinking water is a concern in Canada
• Environmental projects undertaken by corporations

  • Royal Bank's decision to focus on fresh water
• RBC Blue Water Project


  Dedicated to protecting the world's most precious natural resource: fresh water
• RBC has made a $50 million charitable commitment to support initiatives to protect water in towns and cities
• The RBC Blue Water Project also supports conferences, economic reports, and events that help increase awareness about the importance of water
• Climate change


  The result of human activities altering the chemical composition of the atmosphere through the build-up of greenhouse gases that trap heat and reflect it back to the Earth's surface
• Climate change has resulted in an increase in global temperatures and more frequent weather events
• Greenhouse gases


  • Carbon dioxide
  • Water vapor
  • Methane
  • Nitrous oxide
  • Ozone
  • Chlorofluorocarbons
  • Hydrofluorocarbons
  • Perfluorocarbons
• Climate change is a major issue for society and cannot be ignored by business
• Business corporations and individuals can learn about the amount of greenhouse gases they contribute to the atmosphere by using carbon footprint calculators
• Government's influence


  Extensive government involvement exists through public policy formulation and the regulation of all aspects of the natural environment
• The federal and provincial governments have passed environmental legislation, and are considering further legislation
• Governments have announced various programs to create cleaner air, land, and water; to encourage sustainable resources; to develop parks and wildlife areas; to protect the Arctic regions; and to reduce global warming, ozone depletion, and acid rain
• Corporations should engage in a dialogue with government agencies

  So that their interests are protected and to contribute to the resolution of environmental problems
• Governments may directly regulate activities of the corporation or introduce policy changes through taxation rates, the elimination or establishment of subsidies, international agreements, or the creation of markets in tradeable pollution permits
• Business enterprises must establish mechanisms so that they can "listen" to what government is considering, and mechanisms so that they can "talk" to government
• Government departments and agencies have been established not only to regulate the activities of corporations, but also to assist them in meeting environmental performance targets
• Governments have passed legislation to protect the environment that places obligations and responsibilities on business
• It is not uncommon for the legislation to require that an environmental audit be undertaken by corporations or governments involved in environmentally sensitive projects
• Environment-related legislation is enacted by the federal, provincial, and territorial governments in Canada
• Government legislation often stipulates that an environmental assessment document, or report, be submitted to relevant departments of the environment for review and approval
• The report usually has to contain a description of the project, a list of reasons for the project, alternatives to the project, an outline of how the project and its alternatives will affect the environment directly or indirectly, an identification of the actions necessary to prevent those effects, and an evaluation of the advantages and disadvantages of the project to the environment and alternative ways to carry it out
• The report is submitted for evaluation to an environmental assessment agency and often is followed by public hearings
• Most corporations are now familiar with the environmental process and incorporate it into their decision making