A business's capacity to do damage to the climate and environment is generally the consequence of at minimum four broad factors:
The company's "business model". This is the description of the interlocking systems that deliver products, services and value and which generate a profit for the company's owners and investors, and bonuses for its managers. It describes the supporting actions, organisational structures and internal arrangements that are necessary for it to do so. Companies arrange themselves into divisions and departments and give people managerial roles in order to become more efficient at the act of carrying out the business model. Competitors in any industry tend to share similar models, but their competitive advantage or disadvantage lies in the way they structure their activities. The irony is that the more efficient they become, the more they sell, the greater is their consequential impact on the environment because the cost of their activities - their environmental footprint - must land somewhere. And just because a company doesn't appear to do much damage directly, this may manifest somewhere in the influence its activities exert over others from whom it buys or to which it sells.
Trading relationships: No business is an island; if it is, it won't be a business for long, as any company must buy the things it uses to create its own products or services from somewhere, and it must sell them to someone else. Managers refer to this as the "supply chain", and the procurement and sales relationships a company forms are established and reinforced such as to make the business model - the process of profit-making - more efficient. This applies to all businesses, and the economy comprises the sum of all of these transactions. Thus, the more the economy grows, the greater the sum of damage inflicted on the environment. Given the way in which things and companies presently work, this is an unavoidable truth.
Individual executive decisions taken in executing the business model. Businesses, no matter how technologically smart they may be still have human beings at their helm, awarded roles as managers. And managers are recruited to manage the relationships and make the decisions that fulfil the promise of their organisations' business models. But, as managers - whatever their role - are recruited for their skills at contributing to increasing the efficiency with which profit is delivered, their decisions are typically taken without due regard to unintended environmental consequences - what economists refer to as "externalities" - that result from those decisions. Many will be so far removed from either customer interactions or the production of material goods that they can't see the effect of their decisions. And, as long as executives are encouraged only to look at the positive effects of their actions on the corporation's bottom line, and on their promotions, career progression and bonuses, it is unlikely that most would wish to open their eyes to the real consequences of their actions.
The workplace - and downstream consumer - behaviours that are the result of those executives' decisions which give rise to negative environmental impacts. The more expert the company becomes in effecting its business model, and the more quickly profit increases, the more deeply ingrained in the way things are done become the actions it takes to deliver that profit, the fewer are the questions asked as to why things are done that way and the more deeply embedded those activities and decision-making processes become in organisational culture. When businesses then become run by the assumption that there is no better way to do things and no creativity is applied to challenging the status quo, the harder even negative behaviours become to change. The directors and senior managers do all they can to ensure their bonuses increase year on year, shareholders come to expect increasing dividends and the process repeats itself year in, year out. Other companies then mimic these behaviours, making their own improvements and a set of negative impacts becomes embedded in an industry's core belief systems. And the more people who come to believe the same thing, the harder any change becomes.
Until this point, the media and the community, comfortable in continuing waves of economic growth, have been complacent in their enquiries as to what its real effect is on the environment, and which of its businesses - the often hidden villains - are truly culpable on environmental depletion. But now things are changing and there are tools available to find out, and there are many apparently reputable businesses and executives who are highly vulnerable to social enquiry on their environmental records. So far, most businesses that claim any "green" credentials are simply tinkering at the edges and covering their tracks for the bits of their record they would rather not see exposed.
If you are looking at this and thinking the reputation and well-being of the company you own, manage or work for is vulnerable, you are almost certainly right. Delivering effective, responsible competitive change in environmental conduct depends on much more than turning off more lights, managing waste more effectively, producing a sustainability report or choosing another supplier's product or chemical as an input to your product. The magnitude of change needed is nothing less than changing human behaviour itself - that hardest of all changes.
Until we see more companies and their executives held to the blowtorch and new thinking being introduced into every decision taken by managers up and down every supply chain, we will see no improvement on the environment. It really is that simple.
As we will see, companies will go to any extent to defend their profits and reputations against serious inquiry into the true nature of their activities. We must learn and be taught to expose and see through the public relations smokescreen when it appears.
Please add to or suggest any amendments if you think I have overlooked anything important above.
