MBB7002 MSc Marketing
MBB7002 MSc Marketing
Introduction
Sustainability in business involves conducting operations without causing harm to the environment, community, or society. A sustainable business plan aims to make a difference in these areas. Conversely, businesses that neglect their responsibilities can lead to social injustice, inequality, and environmental destruction. Sustainable firms consider social, economic, and environmental aspects when making decisions. People and organisations are becoming more aware of sustainability, emphasising acts such as switching to solar energy and turning off lights to conserve the environment and enhance quality of life. This essay is aimed at examining different viewpoints on sustainable business. By using a theory, the essay provides some key concepts of sustainability in businesses. It also focuses on the critical perspectives surrounding the crises of climate change and biodiversity. Additionally, the essay seeks to critically examine and evaluate these arguments in relation to sustainable business. Furthermore, it evaluates a real-world case that is relevant to sustainability.
Key Concepts
Sustainability and Corporate Social responsibility
Corporate social responsibility (CSR) and sustainability are essential for businesses to build their brand and improve society in many ways, such as employment, education, and the environment. With customers as a major stakeholder, CSR is crucial for long-term strategy and financial success (Samaibekova et al. 2021). Companies across the world are creating plans to improve as corporate citizens, informing stakeholders about their actions, and encouraging staff involvement. A key component of their mission is the improvement of CSR management with a focus on sustainability, whereby contemporary CSR managers assist organisations in achieving ambitious organisational objectives (Samaibekova et al. 2021). Using a triple bottom line theory, sustainability is used by the businesses by dividing it in three aspects, including, economic, social, and environmental (Rashidi et al. 2020).
Economic aspect
The economic aspect of sustainability is maintained by focusing on the profitability of the organisation. Economic models were employed by businesses in the 20th century and are still used to some extent in developing nations (Altynova, 2023). Within the economic dimension of sustainability, businesses prioritise cost containment and profit maximisation. Since the Industrial Revolution, these economic models have largely remained unchanged, with long-term planning largely centred around the operations of the company (Altynova, 2023). These models have a low influence on the budget, and their environmental impact is not considered. From a corporate standpoint, sustainable development aims to maximise output volume while minimising costs (Altynova, 2023). However, profitability of companies can also be enhanced by a sustainable supply chain. Since it integrates social, economic, and environmental concerns, the supply chain is essential to economic advancement. Its original goal of ensuring a steady, quick supply of raw materials has given way to waste management and environmental impact reduction, which can impact on economic development (Sánchez-Flores et al. 2020). These days, sustainable development in the supply chain is a popular business concept that tries to maximise economic gains at the expense of social, environmental, and economic costs.
Social aspect
Businesses have to consider the social developments and needs to create a brand image for the people. In this aspect, businesses focus on the people, mainly for the society to attract them and ensure sustainability. The significance of human resources in organisations has increased due to the growing awareness of sustainability and corporate social responsibility. Nowadays, human resources are seen as the ‘soul of business,’ particularly when considering environmental issues (Amrutha and Geetha, 2020). The achievement of sustainable development objectives relies on the development and administration of top-notch human resource skills. Businesses can increase long-term growth and development, profitability, and productive performance by adhering to optimum resource utilisation strategies (Amrutha and Geetha, 2020). Still, it is difficult to find benchmarks and put best practices into action. Additionally, due to its emphasis on human welfare, equity, democratic governance, cultural variety, gender concerns, and quality of life, education is extremely important to businesses. Education is essential to the process of aligning social aspirations with sustainability goals in a sustainable society (Wolff and Ehrström, 2020). For this reason, companies frequently launch educational programmes to uphold societal wellbeing.
Environmental aspect
In this aspect of the triple bottom line, businesses adhere to environmental regulations and take initiatives for environmental sustainability. Businesses, even SMEs, are adopting energy management initiatives. However, a lot of them lack the means and knowledge to carry it out successfully (Yacob et at. 2019). Businesses need to manage their limited capital and boost energy efficiency considering the rising cost of oil. Water conservation is a significant issue in manufacturing processes, but because it costs money, a lot of businesses ignore it. Another area where corporations are implementing green initiatives is handling waste (Yacob et at. 2019). However, companies, especially SMEs, should prioritise waste management and put systematic approaches in place to efficiently manage and regulate waste if they want to achieve green sustainability. Nonetheless, GHRM training has been used for staff members’ understanding of the environmental effects of green initiatives, which gives them the tools to collect waste statistics, and raises their level of eco-literacy. Employees in 42% of UK-based companies receive eco-friendly training, and $400 million has been invested in green job training to promote environmental sustainability (Paillé et al. 2020). They inform staff members of new performance standards and competences and integrate ecological practices.
Critical Perspectives
Profit vs. Purpose
When it comes to critical perspectives linked with achieving sustainability in business it is essential to consider the tension present between the profit-driven motives of an organisation as well as the genuine commitments towards sustainability (George et al. 2023). It has been argued that businesses as a part of their core function is to maximise profit which is contrary towards long-term sustainable practices and therefore achieving sustainability in the short term might become costly. As a result of this, it can be stated that organisations might choose to stick towards profitability and adopt practices that appear to be sustainable but do not tend to have a significant impact in terms of sustainability (Zu, 2019). This often leads to the prevalence of greenwashing which has become quite prevalent in the present generation where large global companies have been found to adopt sustainable practices with practically no sustainable impact. Coca-Cola has often been labelled as an organisation utilising greenwashing strategies as a part of their sustainability effort considering the fact that the organisation has remained the top plastic polluter for several years in a row (Prabaningrum et al. 2023).
Greenwashing Concerns
In this regard concerns regarding greenwashing have become quite eminent where superficial eco-friendly claims made by large companies are exaggerated and often portray misleading claims about the efforts, they are making towards protecting the environment. In this regard, selective disclosures made by organisations that highlight the positive environmental actions adopted by these companies can be seen to be a major strategy (Adamkiewicz et al. 2022). However, these organisations also selectively choose to hide the negative environmental effects that are affecting the ecology of a particular place in terms of pollution and GHG emissions. These organisations also like transparency where they withhold critical information linked to manufacturing sourcing and the environmental impacts of their various products and services which makes it very challenging for authorities as well as customers to understand to what extent they are sustainable. Adding to that inconsistent messaging made by these organisations regarding their commitment towards sustainability is another key identifier of greenwashing strategies (Lopes et al. 2023). Furthermore, the resistance of organisations toward accountability and improvement which involves addressing criticism is a major concern which further manifests greenwashing leading to scepticism about the authenticity of an organisation’s sustainability claim.
Complexity of Measurement
Another critical perspective linked with sustainability in business is the complexity of measuring sustainable strategies adopted by organisations where diverse metrics and standards have been found to be utilised by different organisations (Rafique et al. 2022). The diversity in metrics used to measure the sustainability of a makes it very confusing and inconsistent in genuinely evaluating to what extent an organisation’s sustainability claims are true. Furthermore, the lack of Data collection and challenges linked with it often make it difficult to gather accurate data that can help in establishing the impact of supply chains and various operations over the environment. Greenwashing and selective transparency are major concerns. The reliability of the data produced by companies regarding their operations is another aspect that makes it challenging to measure sustainability claims (Dubey et al. 2020). Apart from that, the dynamic nature of sustainability which continuously evolves and changes according to priorities and understanding of organisations also makes it difficult as static measurement systems cannot adapt to constantly shifting priorities. Apart from that the interconnectedness and issues linked with standardisation lead to inconsistency and difficulty in benchmarking the sustainability performance of different organisations and their operations. For instance, not every organisation has finished products that have plastics however these organisations have emissions within their supply chain. Therefore, such organisations cannot be compared with organisations that have plastic present in the finished products (Alvarado et al. 2021). These differences make it quite difficult to achieve a universal men’s marking standard between different companies in different industries. Apart from that, transparency, and lack of verification of reporting sustainable strategies is another issue considering the fact these reports are not often cross-checked and verified by authorities.
Trade-offs and Balancing Acts
It has been seen that companies often tend to achieve trade-offs and balancing acts where companies have economic viability against environmental impact. In this regard, companies tend to balance between profitability and the impact of their business operations on the environment in order to make their sustainable practices efficient but at a higher cost (Haffar and Searcy, 2019). Moreover, companies are often found to focus more on long-term gains compared to the high short-term costs linked with achieving sustainable measures due to which they often end up investing a significant proportion on sustainable technologies which hampers their profitability. Balancing Efficiency and conservation are another matter of concern where improving operations might interfere with conservation efforts. Apart from that innovation and risk management also appear to be a barrier and companies need to trade-off between either of them. (Wong and van der Heijden, 2019) For instance to be more innovative companies might ignore risk management strategies which might ultimately affect the businesses however adopting strings and risk management strategies can reduce the overall innovative aspects. Therefore, this is another critical perspective that affects sustainable strategies adopted by businesses on both global and local scales.
Regulatory Influence and Compliance
Regulatory influence and compliances also make it challenging to measure the actual impact of sustainable strategies adopted by global companies. In this regard, a lack of uniform enforcement strategies may lead to non-compliance by businesses that are focused on profit maximisation over sustainability (Kanashiro and Rivera, 2019). Additionally, the cost of compliance makes it a competitive disadvantage in terms of establishing sustainability regulations. For instance, reporting sustainability may increase the cost of operations of different organisations due to which companies might choose to adopt measurement standards that are not up to the mark (Aureli et al. 2020). Furthermore, there are differences between global and local compliance that companies need to adhere to and this mixes it complex and challenging with different regulations present at different levels. For instance, global companies need to adopt and follow both local and global regulations linked with sustainability which makes it quite difficult for them to operate and report their sustainability standards and strategies (Wu et al. 2022).
Sustainability in The Real World
In the real world, among people around the world, the awareness regarding sustainability-related contexts including biodiversity crisis and climate change has been expanding day by day. The growing awareness and concerns regarding the issues of biodiversity and climate change have contributed to the transformation of consumer behaviour in the contemporary business landscape that encourages globally renowned enterprises to ensure the efficacy of their sustainability-related activities or CSR practices (Flores-Hernández et al. 2020). This is because by emphasizing sustainability and aiming to positively impact the environment businesses can gain great consideration from their customers, which can exert influence on the sales rate and financial stability of enterprises. However, the above-discussed critical perspectives reflect that in the contemporary business landscape despite acknowledging the necessity of sustainability, the activities of some businesses may not be in alignment with the concern of sustainability.
In order to depict the real state of sustainability in the real world, the concentration of Coca-Cola on sustainability can be evaluated comprehensively, as in analysing critical perspectives Coca-Cola has been identified as a company that is accused of greenwashing. Since entering the global market, Coca-Cola has given special consideration to the context of sustainability through its CSR practices. The company has made a significant effort to cut its total carbon footprint by 25% by the upcoming 7 years (Coca-Cola, 2023). Furthermore, the organisation committed to attaining net zero emissions by 2050. For this reason, the business is always changing its sustainability-related objectives and solutions on climate change to better the outcomes of its CSR practices (Coca-Cola, 2023).
However, the real picture of Coca-Cola’s concentration on sustainability is different, as it has been identified to be the leading plastic polluter around the world. This is because, according to findings of Statista, about 346,494 pieces of plastic garbage from the company were collected in 55 different countries, as of 2020 (Richter, 2020) (Refer to appendix 1). Consequently, Coca-Cola’s measures fall short in terms of plastic usage as well as GHG emissions. Hence, the maintenance of sustainability in the real world; specifically in some companies like Coca-Cola has become an option to enhance their brand image, rather than emphasising combating climate change and biodiversity-related issues. However, it has been affecting the brand reputation of Coca-Cola as the company has been facing a lot of criticism (Mathieu, 2023).
On the contrary, the CSR practices of Amazon to contribute to sustainable development can be evaluated in terms of the focus of businesses on sustainability in the real world. This is because, in the analysis of critical perspectives, Amazon has been identified as a renowned enterprise that is attentive to the concern of sustainability. Amazon is committed to attain its net zero emission goal by 2040 and to achieve this goal, it emphasizes to use of 100% renewable energy in its business operations (Amazon, 2023). The organisation has been operating its business activities with great consideration for reducing emissions and efficient energy usage (Amazon, 2023).
Moreover, renewable energy as well as more sustainable building materials have been used by Amazon in its buildings and offices. For instance, with the use of low-carbon concrete, the company has constructed 16 data centres and by using low-carbon steel, the company has constructed 10 data centres. In addition, the second headquarters of Amazon in Arlington, Virginia has been powered by 100% renewable energy (Amazon, 2023). Considering this, it can be stated that Amazon has not only made commitments to Amazon, has not only been making commitments to contribute to sustainable development but also is highly motivated to ensure the reduction of its negative impacts on the environment and combat climate change-related issues. Consequently, the company has witnessed a decline in its global carbon emissions by approximately 0.4% from 2021 to 2022 (Palmer, 2023).
Apart from combating the climate change issue, Amazon has also been observed to emphasize sustainability to impact the planet and society positively. In this regard, along with creating job opportunities the company has been advancing human rights and providing their wages to its employees from different backgrounds (Amazon, 2023). For evidence, the company has been committed to invest approximately $53 million for accelerating female representation in climate take partnership with the USAID (U.S. Agency for International Development) (Amazon, 2023). Additionally, as of 2022the organisation has also been supporting approximately 12,600 individuals throughout its supply chain with initiatives like mental health screening. This indicates the focus of Amazon on three pillars of sustainability including the people planet and profitability. The maintenance of these three pillars of sustainability has great effectiveness in terms of ensuring organisational reputation of globally renowned companies (Lock and Araujo, 2020) (Refer to appendix 2).
On a similar note, the example of Unilever can also be drawn to critically evaluate the real picture of sustainability maintenance in the contemporary business world. In the context of sustainability, while comparing Unilever with Coca-Cola, Unilever has been identified to be in a better position in terms of being sustainable. For evidence, while Coca-Cola leads in the list of plastic polluted of 2020, Unilever has been observed to be fourth, with approximately 5,558 pieces of plastic waste collected globally (Richter, 2020) (Refer to appendix 1). However, there is a need for the company to improve its CSR practices to reduce its plastic footprint.
Moreover, the CSR practices of Unilever are in alignment with the sustainable development goal of the United Nations and it is focused on achieving net zero carbon emission goals in its operations by the upcoming 7 years and its value chain by 2034 (Unilever, 2023). Along with these types of climate actions, the company has been strategizing to positively influence the planet and society, which has also been in alignment with the theoretical perspective of the triple bottom line (Unilever, 2023) (Refer to appendix 2). Overall, by analysing sustainability in the real world by comparing sustainability-related initiatives of three globally renowned companies, which are Unilever, Amazon, and Coca-Cola, it is understood that sustainability is one of the prime concerns of companies.
Conclusion
Businesses utilise the triple bottom line theory, dividing sustainability into economic, social, and environmental aspects. It is found that CSR promotes social development and environmental sustainability, while balancing economic aspects with social goals. Businesses adhere to regulations, educate staff, and implement green initiatives for achieving sustainability. There are some critical perspectives such as greenwashing concerns and complexity of measurement. It is seen that sustainability in business faces challenges like profit-driven motives, greenwashing, and measuring strategies. Balancing economic viability, environmental impact, efficiency, and regulatory compliance is also found challenging for businesses. Coca-Cola, Amazon, and Unilever have made significant sustainability commitments. Coca-Cola is committed to reducing its carbon footprint by 25% by 2023 and achieving net zero emissions by 2050 through continuous improvement in its CSR practices. However, Coca-Cola’s actual focus on sustainability has been criticised. Nonetheless, these companies still take sustainability initiatives aligned with UN goals.
Reference list
Adamkiewicz, J., Kochańska, E., Adamkiewicz, I., and Łukasik, R. M. (2022). Greenwashing and sustainable fashion industry. Current Opinion in Green and Sustainable Chemistry, 38, 100710.
Altynova, N., (2023). Current approaches to increasing the profitability of small businesses within the framework of sustainable development policy. In E3S Web of Conferences (Vol. 460, p. 03007). EDP Sciences.
Alvarado, R., Tillaguango, B., Dagar, V., Ahmad, M., Işık, C., Méndez, P., and Toledo, E. (2021). Ecological footprint, economic complexity and natural resources rents in Latin America: empirical evidence using quantile regressions. Journal of Cleaner Production, 318, 128585.
Amazon, (2023). Advancing Human Rights. [Online]. Available at: https://sustainability.aboutamazon.com/human-rights [Accessed on 18 December 2023]
Amazon, (2023). Buildings. [Online]. Available at: https://sustainability.aboutamazon.com/climate-solutions/buildings [Accessed on 18 December 2023]
Amrutha, V.N. and Geetha, S.N., (2020). A systematic review on green human resource management: Implications for social sustainability. Journal of Cleaner production, 247, p.119131.
Aureli, S., Del Baldo, M., Lombardi, R., and Nappo, F. (2020). Nonfinancial reporting regulation and challenges in sustainability disclosure and corporate governance practices. Business Strategy and the Environment, 29(6), 2392-2403.
Coca-Cola, (2023). SUSTAINABILITY. [Online]. Available at: https://www.coca-colacompany.com/sustainability [Accessed on 18 December 2023]
Dubey, R., Gunasekaran, A., Childe, S. J., Papadopoulos, T., Luo, Z., and Roubaud, D. (2020). Upstream supply chain visibility and complexity effect on focal company’s sustainable performance: Indian manufacturers’ perspective. Annals of Operations Research, 290, 343-367.
Flores-Hernández, A., Olavarría-Jaraba, A., Valera-Blanes, G. and Vázquez-Carrasco, R., (2020). Sustainability and branding in retail: A model of chain of effects. sustainability, 12(14), p.5800.
George, G., Haas, M. R., McGahan, A. M., Schillebeeckx, S. J., and Tracey, P. (2023). Purpose in the for-profit firm: A review and framework for management research. Journal of management, 49(6), 1841-1869.
Haffar, M., and Searcy, C. (2019). How organizational logics shape trade-off decision-making in sustainability. Long Range Planning, 52(6), 101912.
Kanashiro, P., and Rivera, J. (2019). Do chief sustainability officers make companies greener? The moderating role of regulatory pressures. Journal of Business Ethics, 155, 687-701.
Lock, I. and Araujo, T., (2020). Visualizing the triple bottom line: A large‐scale automated visual content analysis of European corporations’ website and social media images. Corporate Social Responsibility and Environmental Management, 27(6), pp.2631-2641.
Lopes, J. M., Gomes, S., and Trancoso, T. (2023). The dark side of green marketing: How greenwashing affects circular consumption?. Sustainability, 15(15), 11649.
Mathieu, H., (2023). Coca-Cola HBC, Nestlé, Danone under fire over “greenwashing” claims. Just-drinks. [Online]. Available at: https://www.just-drinks.com/news/coca-cola-hbc-nestle-danone-under-fire-over-greenwashing-claims/#:~:text=Ancient%20Greece’s%20Vineyards-,Coca%2DCola%20HBC%2C%20Nestl%C3%A9%2C%20Danone%20under%20fire%20over%20%E2%80%9C,false%20idea%20of%20environmental%20neutrality%E2%80%9D. [Accessed on 18 December 2023]
Paillé, P., Valéau, P. and Renwick, D.W., (2020). Leveraging green human resource practices to achieve environmental sustainability. Journal of Cleaner Production, 260, p.121137.
Palmer, A., (2023). Amazon sees decline in carbon emissions for the first time. CNBC. [Online]. Available at: https://www.cnbc.com/2023/07/18/amazon-sees-decline-in-carbon-emissions-for-the-first-time.html [Accessed on 18 December 2023]
Prabaningrum, M. R., Suliyanto, S., and Setyanto, R. P. (2023, October). The Effect of Greenwashing on Switching Intention with Green Perceived Risk as a Moderation Variable (Study of Plant Bottle Coca Cola consumers in Indonesia). In Proceeding of International Conference Sustainable Competitive Advantage (Vol. 4, No. 1).
Rafique, M. Z., Nadeem, A. M., Xia, W., Ikram, M., Shoaib, H. M., and Shahzad, U. (2022). Does economic complexity matter for environmental sustainability? Using ecological footprint as an indicator. Environment, Development and Sustainability, 24(4), 4623-4640.
Rashidi, K., Noorizadeh, A., Kannan, D. and Cullinane, K., (2020). Applying the triple bottom line in sustainable supplier selection: A meta-review of the state-of-the-art. Journal of Cleaner Production, 269, p.122001.
Richter, F., (2020). The Companies With the Largest Plastic Footprint. Statista. [Online]. Available at: https://www.statista.com/chart/23744/branded-plastic-waste-found-in-global-cleanups/ [Accessed on 18 December 2023]
Samaibekova, Z., Choyubekova, G., Isabaeva, K. and Samaibekova, A., (2021). Corporate sustainability and social responsibility. In E3S web of conferences (Vol. 250, p. 06003). EDP Sciences.
Sánchez-Flores, R.B., Cruz-Sotelo, S.E., Ojeda-Benitez, S. and Ramírez-Barreto, M.E., (2020). Sustainable supply chain management—A literature review on emerging economies. Sustainability, 12(17), p.6972.
Unilever, (2023). Climate action. [Online]. Available at: https://www.unilever.com/planet-and-society/climate-action/ [Accessed on 18 December 2023]
Unilever, (2023). Planet & Society. [Online]. Available at: https://www.unilever.com/planet-and-society/ [Accessed on 18 December 2023]
Wolff, L.A. and Ehrström, P., (2020). Social sustainability and transformation in higher educational settings: A utopia or possibility?. Sustainability, 12(10), p.4176.
Wong, R., and van der Heijden, J. (2019). Avoidance of conflicts and trade‐offs: A challenge for the policy integration of the United Nations Sustainable Development Goals. Sustainable Development, 27(5), 838-845.
Wu, B., Fang, H., Jacoby, G., Li, G., and Wu, Z. (2022). Environmental regulations and innovation for sustainability? Moderating effect of political connections. Emerging Markets Review, 50, 100835.
Yacob, P., Wong, L.S. and Khor, S.C., (2019). An empirical investigation of green initiatives and environmental sustainability for manufacturing SMEs. Journal of Manufacturing Technology Management, 30(1), pp.2-25.
Zu, L. (2019). Purpose-driven leadership for sustainable business: From the Perspective of Taoism. International Journal of Corporate Social Responsibility, 4(1), 1-31.
Know more about UniqueSubmission’s other writing services:
