Decision Making for the Environment Social and Behavioral Science Research Priorities (2005) / Chapter Skim
Currently Skimming:
4 The Environment in Business Decision Making
4 The Environment in Business Decision Making
Pages 52-68
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 52... ...
Business decisions also influence consumer choices, direct a large fraction of environmental research, and determine much of the development and diffusion of technological innovations. The cumulative effect of businesses' decisions creates many commitments that are difficult if not impossible to reverse in the short term.
|
From page 53... ...
; on government decision making; and to a lesser extent on individual and household environmental decision making, such as energy conservation, recycling, and environmental considerations in consumer behavior (Gardner and Stern, 2002)
|
From page 54... ...
? Further research is needed to characterize more precisely why some facilities and firms create significantly greater competitive advantage through superior environmental performance than others even in the same sector and to identify how internal capabilities as well as external pressures influence those outcomes.
|
From page 55... ...
To understand the overall environmental effects of environmentally protective actions by firms, it is essential that we understand not only the behavior of the most environmentally innovative and competitive firms, but also their impact -- and the limits of that impact -- on the environmental performance of other firms (Sharma, 2002)
|
From page 56... ...
Beyond the European Union, the major markets for the future will be in large emerging and industrializing economies, such as China. How will their consumers' and investors' demand influence environmental performance, and how will these demands both influence business decisions and change with economic growth?
|
From page 57... ...
Supply chain mandates have recently emerged as a new mechanism for leveraging environmental performance improvement (Andrews, Hutson, and Edwards, 2004)
|
From page 58... ...
. In some other sectors, trade associations have functioned as important agents of environmental performance improvement in waste reduction, pollution prevention, and environmental management more generally (for example, the Environmental Protection Agency's Sector Strategies Program, http://www.epa.gov/fedrgstr/EPA-GENERAL/2003/ May/Day-01/g10887.htm)
|
From page 59... ...
And in what other sectors might such club-good characteristics be exploited to produce better environmental performance? What are the major barriers to improved environmental performance in particular understudied but environmentally significant sectors?
|
From page 60... ...
. As yet there has been far less research into the business decision-making processes and other factors affecting the implementation and wider potential of applied industrial ecology.
|
From page 61... ...
Environmental Accounting and Disclosure Practices How can environmental performance best be measured and reported for use in business decision making? It is a truism among business executives that "what gets measured, gets managed." Environmental issues pose important challenges to traditional accounting and management information practices.
|
From page 62... ...
. Implicit in any effort to improve environmental accounting practices is the need to develop credible measures of the impacts of environmental performance on economic performance.
|
From page 63... ...
For example, in the United States both regulations and tax advantages favor end-of-pipe pollution-control technologies over innovation in production processes, whereas technology policies often lack explicit environmental criteria. A recent workshop report by the Organisation for Economic Cooperation and Development argued that decisions about technological innovation lie at the heart of business decision making about improving environmental performance and concluded that one of the most important public policy challenges is to coordinate the technological incentives of environmental policy with the environmental effects of innovation policy (Organisation for Economic Co-operation and Development, 2000:22, 14)
|
From page 64... ...
RATIONALE FOR THE SCIENCE PRIORITY Likelihood of Scientific Advances Over the past several decades, the implications of environmental considerations for business decision making have become more widely recognized by leading business decision makers than by the research community. Yet because of the paucity of systematic research, decisions by these business leaders have been based largely on anecdotes and driven by a focus on limited elements of these implications -- regulatory constraints, cost burdens, and liability risks, for example -- rather than by analysis of the full range of opportunities for adaptation and innovation that could benefit businesses as well as the public.
|
From page 65... ...
Several trade associations, for example, have mandated environmental codes of conduct as membership criteria (e.g., the American Chemistry Council and the American Forest and Paper Association) ; others have sought to assist small enterprises in their sectors to improve their environmental performance (metal plating, dry cleaning, and automotive repair shops, for example)
|
From page 66... ...
Its program for decision, risk, and management science supports research in management science, risk analysis, societal and public policy decision making, behavioral decision making and judgment, organizational design, and decision making under uncertainty, including particularly work on judgment and decision processes; risk perception, communication, and management; organizational performance; and modeling of managerial processes. The NSF program on Human Dimensions of Global Change includes explicit research priorities on innovation and diffusion processes related to global environmental change, resource use and management, anticipatory and reactive adaptation and mitigation, economic issues including international trade patterns and global sectoral models, and environmental accounting.
|
From page 67... ...
But these generalizations do not apply to many of the leading firms in key industries, which are keenly interested in ways to improve their environmental performance. Many of the leading firms are also major transnational corporations that can promote wide dissemination of research findings through their influence on their subsidiaries, suppliers, and business customers, on their peers in the same and other sectors, and even on government decision makers and the news media.
|
From page 68... ...
The recommended research may also be used by government decision makers, many of whom have shown interest in improving their understanding of business decision making in order to design more effective and efficient programs for environmental performance improvement. Examples include the recent proliferation of government-sponsored voluntary initiatives (Mazurek, 2002)
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.