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SUSTAINABILITY CONSUMER TREND

Consumers are paying more attention to their purchasing. 65% of British Customers are trying to live more ethically than they did a year ago (Ethical Lifestyles- UK, June 2018). They tend to show interest in the brands or suppliers which are taking actions to have a positive impact on the environment. Meanwhile, they are also searching for easy ways to reduce waste and energy use.

Sustainability in society and the environment are one of the main concerns of customers nowadays. More than 50% of fish customers in the UK want adviser for more sustainable alternatives and 40% of the young women between 16 and 24 are up for more environmentally friendly textile of clothes (Mintel, 2018).

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sudev sustainable development

SUSTAINABLE DEVELOPMENT

United Nations General Assembly proposed Sustainable Development Goals (SDGs) to sustain our society and environment for current and future generation in 2015. The goals are broad and interdependent, while each has a separate list of targets to achieve. The SDGs cover social and economic development issues including poverty, hunger, health, education, global warming, gender equality, water, sanitation, energy, urbanization, environment and social justice.

SDGs not only give governments targets to achieve but also offer business a wide range of opportunities for innovations and new market development. A more stable society and ecosystem can assure the smooth of business operation. Companys are committing to sustainability initiatives since they realise that benefits from this engagement, such as the royalty of customers and are sustained resource.

“With on-going innovations making sustainability commercially feasible, more businesses are expected to adopt sustainable business practices.(Euromonitor Intl., 2016)”

Even though there have been many businesses taking part in this SD movement, the contribution from more companies is expected to meet the SDGs before the deadline in 2030. To align SDGs, businesses should not limit their engagement within the actions they are convenient to take.

 

NRBV (NATURE-RESOURCE BASED VIEW)

In studies on strategy management, it has been understood that the competitiveness of a firm not only relies on its internal capabilities but also depends on the external situation (Penrose, 1959, Chandler, 1962). The resource-based theory then emerged emphasising endogenous resources and capabilities to generate inimitable and rare value in order to sustain competitive advantage with increasingly intense competition (Hart and Dowell, 2011). However, this view omitted the interaction between firms and the natural environment, which may be understandable as it came before the environmental problem became so severe. Hence, the ‘Nature-resource based view (NRBV)’ was introduced in 1995 (Hart and Dowell, 2011). Hart (1995: 990) found that fast-expanding industry activities and accelerating resource use challenge the capacity of the natural environment to such an extent that it cannot recover. Hart, therefore, argues that ‘natural resources’ can constrain firms’ attempts to maintain their advantage, and he introduces the idea of NRBV. The causes of this constraint come from environment-related issues, such as environmental system degradation and resource depletion, and can limit the continuities of the available resource or capabilities of firms. To overcome the restrictions, Hart (1995) proposes three stages of environmental action firms can be taken into account. They are pollution prevention, product stewardship and sustainable development. Pollution prevention can lower cost by preventing waste and emission rather than end-of-pipe (EoP) pollution control. Meanwhile, product stewardship pulls the level of changes up to the supply chain, aiming to minimise the environmental impact of production. Last but not least, sustainable development not only considers natural resources but also include global and social concerns.

 

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Reference :

Chandler, A. (1962). Strategy and structure. Cambridge, MA: MIT Press.

Hart, S. L. (1995). A natural-resource-based view of the firm. Academy of Management Review, 20. p. 986–1014.

Hart, S., & Dowell, G. (2011). A Natural-Resource-Based View of the Firm: Fifteen Years After. Journal of Management, 37(5), p. 1464–1479.

Penrose, E. 1959. The theory of the growth of the firm. New York: Wiley.

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Today is the best time for business to discuss sustainability. There are quite some companies have launched projects to reach sustainability. Moreover, the idea of sustainability become known by everyone in governments and business. This concept has also been replacing traditional and profit-oriented approaches, directing firms to achieve a balance between the natural environment and economy incentives for both current and future generations (Lozano et al., 2015).The sustainability of both the environment and firms can be achieved if the three dimensions of the triple bottom line (i.e. economic, environmental and social) are equal rather than only focused on economic performance, as has traditionally been the case (Elkington, 1999). These studies imply that economic sustainability is not the only aspect firms should consider for sustaining their operation. When making revenue is not the only goals of the business, the business can live with the society and environment. If a company ignore the sustainability of society and environment, it could not reach the sustainability of the operation. Thus, corporate has to engage in social responsibility and environmental responsibility.Corporate Social Responsibility (CSR) not only means that corporates have to involve in some charity events or make donations. It has a border meaning: Taking good care of employees, complying regulations and keep improving the product or services and trying to reduce social cost.Corporate Environmental Responsivity (CER) used to be included in CSR. It has gotten concerned due to the increasing interest in sustainability and the wellbeing of human rights. Without a sustainable environment, the economic behaviours could not be sustained. For instance, the degrading ocean resource decreases the harvest of the fishery and impact the industry. If we cannot reduce the used or recycle the limited resource, they will be no longer available.That is to say, generating revenue, CSR and CER, the triple bottom line is the base of business operation. They are key of sustainable development and long lasting for corporates.

Reference :

Elkington, J. (1999). Cannibals with forks: The triple bottom line of 21st century business. Oxford: Capstone.Lozano, R., Carpenter, A., & Huisingh, D. (2015). A review of ‘theories of the firm’ and their contributions to Corporate Sustainability. Journal of Cleaner Production, 106(C), p. 430–442.

TRIPLE BOTTOM LINE(TBL)

In studies on strategy management, it has been understood that the competitiveness of a firm not only relies on its internal capabilities but also depends on the external situation (Penrose, 1959, Chandler, 1962). The resource-based theory then emerged emphasising endogenous resources and capabilities to generate inimitable and rare value in order to sustain competitive advantage with increasingly intense competition (Hart and Dowell, 2011). However, this view omitted the interaction between firms and the natural environment, which may be understandable as it came before the environmental problem became so severe. Hence, the ‘Nature-resource based view (NRBV)’ was introduced in 1995 (Hart and Dowell, 2011). Hart (1995: 990) found that fast-expanding industry activities and accelerating resource use challenge the capacity of the natural environment to such an extent that it cannot recover. Hart, therefore, argues that ‘natural resources’ can constrain firms’ attempts to maintain their advantage, and he introduces the idea of NRBV. The causes of this constraint come from environment-related issues, such as environmental system degradation and resource depletion, and can limit the continuities of the available resource or capabilities of firms. To overcome the restrictions, Hart (1995) proposes three stages of environmental action firms can be taken into account. They are pollution prevention, product stewardship and sustainable development. Pollution prevention can lower cost by preventing waste and emission rather than end-of-pipe (EoP) pollution control. Meanwhile, product stewardship pulls the level of changes up to the supply chain, aiming to minimise the environmental impact of production. Last but not least, sustainable development not only considers natural resources but also include global and social concerns.

Reference :

Chandler, A. (1962). Strategy and structure. Cambridge, MA: MIT Press.

Hart, S. L. (1995). A natural-resource-based view of the firm. Academy of Management Review, 20. p. 986–1014.

Hart, S., & Dowell, G. (2011). A Natural-Resource-Based View of the Firm: Fifteen Years After. Journal of Management, 37(5), p. 1464–1479.

Penrose, E. 1959. The theory of the growth of the firm. New York: Wiley.

 

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SMEs are more likely to benefit by corporation when engage in eco-innovation/ environmental responsibility

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63% of business is more committed to achieving a sustainable future. (edie, 2018)​

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83% companies are interested in taking part of the sustainable movement. (edie.live, 2018)