Page 321 - Cambridge IGCSE Business Studies

25: Environmental and ethical issues

Sustainable development
A business is said to be sustainable if it contributes towards the economic growth
of the country and makes profits while obeying the law, being ethical and

environmentally friendly. For example, a business can take the following steps to
be sustainable:

■ use renewable sources of energy
■ avoid unnecessary travel by promoting a work from home policy (telecommuting)
■ avoid or reduce the use of chemicals that produce toxic waste
■ use packaging that is made of recycled material
■ use packaging that can be recycled or reused

KEY TERM ■ use energy efficient processes and equipment to minimise the use of energy
■ reduce waste or find a market where it can be used as a raw material
Sustainable development: a
■ work with employees, customers and suppliers fairly.
business activity is said to
be sustainable if it has a To achieve sustainable development, a business needs to weigh up the
positive overall impact on the
environmental, social and economic impacts of its activities. If these meet the
environment and its stakeholders,
ensuring its survival in the future. indicators shown in Table 25.4, the business is said to promote sustainable
development.

Environmental Social Economic
■ Conservation of natural resources. ■ High life expectancy by generating ■ Low unemployment by providing
■ Conservation of forest and habitats less pollution. work to people. 319
for endangered animals and plants. ■ Gender equality by having relevant ■ High literacy rates by setting up
■ Use of renewable sources of energy human resources policies in place. training and knowledge-sharing
like solar and wind power for ■ Ethical business decisions by programmes for employees.
business activity. conducting a social cost-benefit ■ Growing GDP by generating products
■ Reduced greenhouse gas emissions analysis of a project. and services.
by using greener sources of energy. ■ Fair compensation to employees. ■ Improved standards of living
■ Proper waste management from by paying employees fairly and
business activity so that pollution improving working conditions.
levels can be controlled, for example
recycling.

Table 25.4 Indicators of sustainable development

Despite the possible costs of sustainable development, some businesses try to
do what is right for the environment and the community in which they operate.

This might be in terms of production processes used, charitable actions or
what they produce. For example Samsung, one of the world’s leading home
electronics manufacturers, has led the way in sustainable development in the
technology industry. It has introduced a number of environmentally friendly
products such as solar-powered computer notebooks and energy effi cient
microwave ovens.

Environmental pressures and opportunities
Businesses have to respond to the threat they face from environmental pressures.

Environmental pressures can also be positive and offer opportunities for
established and new fi rms.