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  1. business-and-its-environment

    enterprise
    6 主题
  2. business-structure
    6 主题
  3. size-of-business
    3 主题
  4. business-objectives
    3 主题
  5. stakeholders-in-a-business
    2 主题
  6. external-influences-on-business
    12 主题
  7. business-strategy
    10 主题
  8. human-resource-management
    human-resource-management-hrm
    8 主题
  9. motivation
    4 主题
  10. management
    2 主题
  11. organisational-structure
    5 主题
  12. business-communication
    5 主题
  13. leadership
    2 主题
  14. human-resource-strategy
    3 主题
  15. marketing
    the-nature-of-marketing
    7 主题
  16. market-research
    3 主题
  17. the-marketing-mix
    6 主题
  18. marketing-analysis
    5 主题
  19. marketing-strategy
    3 主题
  20. operations-management
    the-nature-of-operations
    3 主题
  21. inventory-management
    2 主题
  22. capacity-utilisation-and-outsourcing
    1 主题
  23. location-and-scale
    2 主题
  24. quality-management
    1 主题
  25. operations-strategy
    4 主题
  26. finance-and-accounting
    business-finance
    2 主题
  27. sources-of-finance
    3 主题
  28. forecasting-and-managing-cash-flows
    1 主题
  29. costs
    4 主题
  30. budgets
    1 主题
  31. financial-statements
    4 主题
  32. analysing-published-accounts
    6 主题
  33. investment-appraisal
    2 主题
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Environmental issues and business decisions

  • Businesses can have a range of negative impacts on the environment

Business impacts on the environment

Industrial skyline with pollution, derelict buildings, and litter by a river, alongside a congested road, illustrating various types of urban pollution.
Negative business impacts on the environment include noise, air, visual and water pollution, traffic congestion and dereliction

  • Pollution is caused by industrial processes that release harmful gases into the air or harmful substances into the ground

  • Land and buildings may become unusable when businesses process dirty or toxic materials, leading to dereliction

  • Traffic congestion is caused by vehicles delivering materials to and from businesses, as well as by commuting employees

  • Visual pollution is caused by unattractive buildings or business works that worsen inhabitants’ views of their surroundings

Ways businesses reduce their environmental impact

Method

Example

Increasing the amount of waste they recycle or reuse

  • Two-thirds of LUSH Cosmetics‘ products, including bath bombs and shampoo bars, are sold without packaging, which has saved over 4,000 tonnes of plastic

Encouraging employees to use public transport or walk/cycle to work,

  • Recognising that cycling improves employees’ health and cuts time spent commuting, Great Ormond Street Hospital has hundreds of bicycle parking spaces at its site in central London and provides free bicycle maintenance to its staff

Switching to electric vehicles for staff

  • Construction company Tarmac has committed to converting its whole car and van fleet and will install charging infrastructure at locations across the UK by 2030

Becoming carbon-neutral

  • Marks and Spencer became carbon neutral in 2012 by using renewable energy, such as solar, to power their buildings and ensures that none of their internal waste goes to landfill

Improving the appearance of their surroundings

  • Packaging company Maxpack involved employees in the planting of hundreds of pine trees at its head office in Shropshire so as to make a positive contribution to tackling climate change

Responding to climate change

  • IKEA owns wind farms and solar parks that now generate more electricity than its stores use each year

Responding to water scarcity

  • Coca-Cola’s bottling plants in India reuse process water and fund local rain-harvesting projects to return as much water as they take

  • Governments encourage businesses to reduce their environmental impact

    • Strict regulations dictate the way businesses dispose of waste to avoid pollution

      • Higher charges for disposal, as well as limits on the volume of permitted waste, increase business costs

      • Fines for businesses that break environmental regulations and order them to clean up environmental damage

      • Banning of hazardous materials in manufacturing processes means alternatives must be sourced or developed

    • Some governments are focused on the switch from fossil fuels to green energy production, such as solar and wind power

      • In the long term, this should mean that businesses are likely to enjoy lower and more consistent energy costs

    • Many governments have introduced curbs on business activities that cause environmental damage

      • E.g. Pollution permits allow businesses to pollute up to a certain limit

Examiner Tips and Tricks

Chains of analysis should link an issue to a business decision, leading to an outcome

For example, ‘As water is scarce (issue), the brewery invests in water recycling equipment (decision), cutting both costs and environmental risk (outcome)’

Environmental audits

  • An environmental audit is a systematic check of how a business affects the environment

    • Independent reviewers compare what the firm actually does with laws, company policies, and best-practice standards, then report the findings

What an environmental audit includes

Flowchart illustrating environmental management steps: policy review, compliance check, resource usage, emissions and waste, site inspection, management systems, improvement plan.
Environmental audits check resource usage, waste and legal compliance

  1. Policy review

    • Does the firm have clear environmental goals and responsibilities?

  2. Legal compliance check

    • Is it meeting all relevant regulations on air, water, waste and chemicals?

  3. Resource use assessment

    • Measurement of energy, water, and raw-material consumption

  4. Emissions and waste analysis

    • Quantities of greenhouse gases, effluent, waste, and recycling rates

  5. Site inspection

    • Examination of equipment, storage areas and emergency procedures

  6. Management-system evaluation

    • How well staff training, record-keeping, and monitoring systems work

  7. Improvement plan

    1. Recommendations, targets, and deadlines for reducing the business’s environmental impact

How businesses and stakeholders use environmental audits

Business use

Stakeholder use

  • Set clear environmental targets

    • Measure energy, waste, and emissions to see if goals are met and fix problems early

  • Assessing risk

    • Investors look at the audit to see if poor environmental practices could cost the company money later

  • Improve day-to-day checks

    • The data collected for the audit feeds into daily reports, so managers spot issues quickly and keep improving

  • Shoppers and jobseekers compare firms

    • People use audit results to choose where to buy or work, often favouring greener companies

  • Build trust

    • An outside expert or well-known standard (e.g. ISO 14000) shows the company’s environmental reputation can be believed, improving its image

  • Communities and regulators track progress

    • They use the audit to see pollution levels and push the business to meet higher standards

The importance of sustainability

  • Sustainability means meeting our current needs without compromising the ability of future generations to meet their own needs

  • Businesses can contribute to sustainability by changing their operations in a variety of ways

Improving sustainability

Diagram with a central leaf symbol and circular arrows, surrounded by strategies: recycling, renewables, reducing water, green transport, and avoiding toxins.
Businesses can contribute to sustainability in a range of ways

Using renewables in production

  • More than 99% of the wood used in IKEA‘s furniture products is either sourced from sustainable sources or recycled

Reducing water use in industrial processes

  • Introduced in 2011, Levi’s Water<Less programme reduces the use of water in the manufacture of the company’s denim products, so far saving over 4.2 billion litres of water in shortage areas

Using green transportation, such as electric vans

  • Almost 40% of delivery company Evri’s London vehicles are zero-emission and the company operates e-cargo bikes across four UK cities

Avoiding the use of toxic substances

  • Home accessories brand Parachute uses organically-grown textiles, with no harmful chemicals used at any stage of production

Using renewable energy, such as solar

  • Unilever uses 100% renewable electricity across all its factories, offices, R&D facilities, data centres, warehouses and distribution centres. They also generate their own solar power at production facilities in 23 countries.

Implementing recycling

  • Revive Innovations Ltd recycles compact discs, turning them into beautiful items of furniture and home accessories

Trade-offs between sustainability and profits

  • Adopting sustainable practices can involve significant upfront costs and operational expenses

    • Sustainable raw materials and components may be more expensive

    • Adapting production processes and machinery may require significant capital investment

  • These additional costs can potentially reduce profitability, at least in the short term

  • On the other hand, prioritising short-term profits over sustainability can lead to long-term consequences, such as resource depletion and environmental damage

    • This can create legal issues or cause damage to a business’s reputation

  • These factors undermine a company’s long-term viability and profitability