What’s in it for me?
Indirect Economic Benefits for Business

Although the direct cost efficiencies are key, indirect savings from strategic planning are also important to a company’s viability. Environmental considerations can work well to give a company a competitive edge in the long run.

Businesses stand to gain by altering their image to the public as consumer demands change. Environmental issues are more mainstream today than perhaps ever before. A company that understands this, and thus its consumers’ (and employees’) attitudes, can adjust accordingly and employ environmental measures to keep up with public demands. This works at the local shop level as well as for the international corporations. For example, the Environmental Protection Agency’s “Performance Track” program measures a company’s environmental performance, allowing the company to position itself as an environmental leader, without sacrificing economic prosperity. It encourages and recognizes environmental excellence beyond compliance with regulatory requirements. Current program members exceed 300 and include IBM, Johnson and Johnson, and Motorola.

Money can also be saved by reducing the costs of sub-standard environmental performance, current and future, and by enabling long-term adaptability with regard to legislation. Many measures can be implemented for minimal relative cost and usually pay for themselves quickly, a clearly desirable alternative to government intervention, heavy fines and drawn-out litigation. Perhaps even more importantly, a company that stays ahead of regulations will remain agile and can keep its edge while others may have to slow operations to catch up to new laws and standards imposed by the government.

Case Study 1: Volkswagen: (taken from Eco-Efficiency)

• Focus on less direct benefits
   
• Spent $30 million on environmental protection in one year
   
• Increased competitive advantage by positioning the company as a leader in ecologically conscious car manufacturing
   
• Enhanced image of its “high prestige and high value products”

Case Study 2: Sustainable Farming in Holland and the use of Green Labels (read more …)

• Producers, industry and consumers have agreed goals for sustainable agriculture. One mechanism for achieving these goals is the green label scheme.
   
• Farmers can use a green label on their products if they are certified under a scheme requiring their agreement to use only selected environmentally benign pesticides. They must also agree to percentage reductions in total pesticide use.
   
• Public perception and consumer choice for green label products provide economic benefits for participating farmers.

References

Eco-Efficiency: The Business Link to Sustainable Development by Livio De Simone and Frank Popoff with the World Business Council for Sustainable Development (1997).

ISO 14000: Issues & Implementation Guidelines for Responsible Environmental Management by James L. Lamprecht (1997).

Pesticide News

Transformation Strategies

Covenants are policy management tools used by industry to meet national environmental goals established in the Netherlands’ 1989 National Environmental Policy Plan (NEPP). The successful structure and process of covenant preparation is enabling the Dutch to recover environmental quality, by giving businesses the role of determining how goals are met. Read more about this innovative tool ...

Indirect Economic Benefits

Although the direct cost efficiencies are key, indirect savings from strategic planning are also important to a company’s viability. Environmental considerations can work well to give a company a competitive edge in the long run.

Businesses stand to gain by altering their image to the public as consumer demands change. Environmental issues are more mainstream today than perhaps ever before. A company that understands this, and thus its consumers’ (and employees’) attitudes, can adjust accordingly and employ environmental measures to keep up with public demands. This works at the local shop level as well as for the international corporations. For example, the Environmental Protection Agency’s “Performance Track” program measures a company’s environmental performance, allowing the company to position itself as an environmental leader, without sacrificing economic prosperity. It encourages and recognizes environmental excellence beyond compliance with regulatory requirements. Current program members exceed 300 and include IBM, Johnson and Johnson, and Motorola.

Money can also be saved by reducing the costs of sub-standard environmental performance, current and future, and by enabling long-term adaptability with regard to legislation. Many measures can be implemented for minimal relative cost and usually pay for themselves quickly, a clearly desirable alternative to government intervention, heavy fines and drawn-out litigation. Perhaps even more importantly, a company that stays ahead of regulations will remain agile and can keep its edge while others may have to slow operations to catch up to new laws and standards imposed by the government.

Case Study 1: Volkswagen: (taken from Eco-Efficiency)

• Focus on less direct benefits
   
• Spent $30 million on environmental protection in one year
   
• Increased competitive advantage by positioning the company as a leader in ecologically conscious car manufacturing
   
• Enhanced image of its “high prestige and high value products”

Case Study 2: Sustainable Farming in Holland and the use of Green Labels (read more …)

• Producers, industry and consumers have agreed goals for sustainable agriculture. One mechanism for achieving these goals is the green label scheme.
   
• Farmers can use a green label on their products if they are certified under a scheme requiring their agreement to use only selected environmentally benign pesticides. They must also agree to percentage reductions in total pesticide use.
   
• Public perception and consumer choice for green label products provide economic benefits for participating farmers.

References

Eco-Efficiency: The Business Link to Sustainable Development by Livio De Simone and Frank Popoff with the World Business Council for Sustainable Development (1997).

ISO 14000: Issues & Implementation Guidelines for Responsible Environmental Management by James L. Lamprecht (1997).

Pesticide News

Transformation Strategies