Environmentalism and Sustainability
Environmentalism and Sustainability
The importance of the environment and how to preserve it have become as much a priority for corporations as for individual citizens. “Going green” is not only the socially accountable thing to do, it is also one of the most progressive new ways that companies are winning over new clients and saving more money than ever before. Interestingly, doing the right thing for the environment is now, more than ever, a win-win game for stakeholders, business owners, and consumers alike.
Environmentalism on the corporate scale has become a good deal more organized as its importance to the future and sustainability of the planet becomes paramount. Learning how to manage entire corporations and all aspects of their operation in a manner that will be eco-friendly is no longer the exception but the rule. How to manufacture goods and offer services using greener methodologies is the future of business on all fronts and will shape the future of commerce as much as any other crucial marketplace variables.
FINANCIAL BENEFITS OF GOING GREEN
For many corporate entities, the idea of changing practices to become a more environmentally friendly operation isn't enough to commit the resources and time to change practices or completely revamp company policies that are often decades old. But as “greening up” becomes the lasting trend, it shapes the climate of the commercial world; companies that live up to a higher environmental standard will attract a new majority of consumers who
care. Saving money and creating larger profit margins are an added benefit to new, more ecologically sound business and manufacturing practices.
Revenue is increased by simple increase of value. Both consumers and stakeholders see the value of a corporation increase as their practices become more in line with current and future trends and move away from antiquated methods and practices that give a company a reputation for being old-fashioned or behind the times. When consumers and shareholders believe a corporation is moving in a positive direction on a consistent basis, they are more likely to buy more, invest more, and become vigilant about spreading the word—there is no more powerful marketing tool than consumers telling friends and family about the good conduct and quality products or services being provided by a company.
Corporations also increase revenue and lower their cost of production when they act in environmentally friendly ways that save energy. Reducing carbon footprints by making operations more sustainable also bodes well for corporate reputations. Something as simple as reducing the output of greenhouse gases by switching to alternative fuel and energy sources or reducing energy output by reinsulating an old factory can save millions of dollars over a short period of time. Many companies have started to save money by offering customers e-mailed versions of billing statements or access to an online account where bills can be paid, merchandise and services can be purchased, and customers can communicate virtually with company representatives. In this way, metric tons of paper are saved, trees are spared, and dramatically less energy is used. To spread the word, companies incorporate information about new, greener practices in their marketing strategies.
A joint study by firms Jones Lang Lasalle and CFO Research showed that more than 50 percent of seasoned executives and corporate officers believe that green practices will increase revenue, and more than 45 percent believe that a main environmental concern of corporations should be reducing the impact of manufacturing and other operations on the environment. With these kinds of values intact at the head of large corporations, it is clear that learning and knowing how to manage a company from an environmentally responsible standpoint is crucial to the future of today's successful enterprises.
Because of the rising importance of ecologically sound practices in the corporate sphere, more and more schools of management and business colleges are offering degrees in green management or programs pertaining to green management as part of their curriculums. The Dominican University of California is home to green business degree pioneer Professor John Stayton, and many other colleges and universities across the United States and the world now offer “green degrees” in several disciplines. Across Asia, especially in Hong Kong, green management practices have become extremely popular—the governments of some Asian countries now offer incentives to corporations that practice green management and manufacturing. These polities also strongly urge companies of all sizes and in many industries to have green committees and managers trained in eco-friendly practices that they can hand down to their subordinates.
The rising importance of proactive and ecologically responsible corporate conduct varies in popularity from one country and region to another. The best way for new and growing enterprises to hedge their bets is to simply practice the highest standards of green management and manufacturing to ensure that their standards are, at the very least, as high as those in use in any region where future business could be headed. Companies that understand this are always researching and putting into practice the newest ways of “greening up” any processes they undertake to create products or offer services. Ensuring that transitions to greener practices go smoothly and that the highest level of efficiency is attained is the job of managers—hence the rising importance of a strong environmentally conscious education from a management school.
An important part of green management has been the ISO 9000 and ISO 14000 standards. These two international standards of quality are motivated to show they want to lessen waste, wish to be greener, and wish to be perceived as a proponent for ecologically friendly business and manufacturing practices. ISO 9000 and ISO 14000 are standards put forth by the International Organization for Standardization that effect both quality and environmental management. The two standards do this by encouraging companies to improve processes that may have harmful effects on the environment, and to improve the quality of products and services for consumers in a manner that lessens the carbon footprint of both the consumer and the purveyor of the product or service.
Green managers are responsible for giving their company the competitive edge against other industry names by constantly creating new ways of saving energy, lessening the company's carbon footprint in any way possible, and saving money through the use of measures that meet those needs. A qualified green manager will make it possible for a corporation to meet its production needs and deadlines using less energy and output a higher quality product that is friendlier to the planet for consumers. A green manager will also keep up with changing laws, regulations, and trends to ensure that his or her enterprise stays ahead of the curve. In addition to these roles, a green manager must also create ways to market the business so that consumers can appreciate the good the company is doing for the
environment. Research indicates that consumers who believe company A is greener than company B will gladly spend the few extra dollars or drive the few extra miles to buy the product or service from company A. A qualified green manager knows this about consumers and creates a way to commercialize and publicize the company's efforts at environmentalism.
Green manufacturing is the practice of lessening the output of any type of pollution, waste, or byproduct of manufacturing any product. The greater aim of green manufacturing, beyond saving money and increasing corporate profits, is to conserve energy and natural resources and make an effort to leave the environment better—rather than worse—than it was found. Green manufacturing is not always the easiest route for all companies in all industries, but even those firms that won't make up for the cost in terms of overhead will almost always pick up the difference in profit margins and popularity with consumers. Additionally, when companies have to pick up the extra cost of doing business in a more ecologically sound manner, there will often be the impetus for further research and development that uncovers groundbreaking new methods for manufacturing that cut costs for all parties involved, including the consumer.
Recycling and reusing are important aspects of green manufacturing, and consumers are happy to support corporations that actively make use of recycled materials. In addition to making use of materials that have already been processed, reusing when it is a viable option also keeps overall cost down by reducing the need to process new materials, which saves on both raw materials and energy.
Everyday, more advanced methods of green manufacturing become more cost effective and realistic for more companies across more industries. As the popularity of green manufacturing grows, so does the likelihood of more expeditious development of progressively more innovative systems and processes of manufacturing. Of course, there is a cost associated with training existing employees on green manufacturing methods, which may include learning how to operate new machines and other technologies. However, the financial undertaking of training laborers is better spent on ecologically sound methods than on training that would likely be done at some point anyway on equipment that may or may not be so environmentally friendly.
Types of Green Manufacturing. Just in time (JIT) manufacturing is a type of supply chain management that helps reduce the cost and waste output of manufacturing. JIT accomplishes this by more closely following market and consumer trends to know how much of which product to create based on demand. Additionally, components used to create products are not housed by the manufacturing company, thus reducing energy needed to operate, heat, cool, and otherwise maintain warehouse space.
Zero emission manufacturing is a highly green methodology that calls for absolutely no output of hazardous materials that could harm the environment. While this type of green manufacturing is not possible for all entities in all industries, it certainly sets the bar high and creates an atmosphere of high corporate responsibility, one in which companies are competitively urged to hold themselves to a higher standard of production.
EXISTING GREEN COMPANIES
There are many companies, even very large corporations that have been environmentally friendly for many years, some since their conception. Some companies have gone green intentionally while others are green as a natural off-shoot of how or where they do business. According to a 2007 article about “green giants” in Fortune magazine, Goldman Sachs, Hewlett-Packard, Continental Airlines, Pacific Gas and Electricity (PG&E), and S.C. Johnson are American-based corporations leading the pack. All of these are large corporate entities that are changing the way business is done globally by creating and following a higher standard of green management and manufacturing.
“10 Green Giants.” Available from: http://www.money.cnn.com/galleries/2007/fortune/0703/gallery.green_giants.fortune/7.html.
Frazier, Scott C. “JIT Manufacturing: Lean Manufacturing and Stockless Production.” Indiana: Ball State University, 2004.
“Green Managers Turn Others Green!” Available from: http://www.globalinvesting411.com/articles/00000009.shtml.
“ISO 9000 and ISO 14000.” Available from: http://www.iso.org/iso/iso_catalogue/management_standards/iso_9000_iso_14000.htm.
“Jones Lang LaSalle-Sponsored Study Finds CFOs See Financial Benefits in Adopting Environmental Sustainability Practices and Metrics.” Available from: http://www.ifma.org/daily_articles/?pg=032808.cfm.
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