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Eco-Business

A Big-Brand Takeover of Sustainability

By Peter Dauvergne and Jane Lister
12-minute read
Eco-Business: A Big-Brand Takeover of Sustainability by Peter Dauvergne and Jane Lister

Eco-Business (2013) unpacks corporate sustainability initiatives to reveal a business model that has far more to do with profit and market share than earnest environmentalism. The tools and tactics described in these blinks allow businesses to cut costs and maximize profits, all in the name of the environment. Yet through firms’ collaboration with governments and NGOs, some corporate eco-initiatives can actually have a positive effect on the environment.

  • Business leaders looking to cut costs, increase efficiency and promote a “green” image
  • Policymakers curious about the real impact of corporate sustainability initiatives
  • Consumers wanting to know how their purchases affect the environment

Paul Dauvergne is a political science professor and the director of the Liu Institute for Global Issues at the University of British Columbia. He’s authored and co-authored several books, including Timber and The Shadows of Consumption: Consequences for the Global Environment.  

Jane Lister is a senior research fellow at the Liu Institute for Global Issues at the University of British Columbia. Her previous books include Timber and Corporate Social Responsibility and the State: International Approaches to Forest Co-Regulation.

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Eco-Business

A Big-Brand Takeover of Sustainability

By Peter Dauvergne and Jane Lister
  • Read in 12 minutes
  • Contains 7 key ideas
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Eco-Business: A Big-Brand Takeover of Sustainability by Peter Dauvergne and Jane Lister
Synopsis

Eco-Business (2013) unpacks corporate sustainability initiatives to reveal a business model that has far more to do with profit and market share than earnest environmentalism. The tools and tactics described in these blinks allow businesses to cut costs and maximize profits, all in the name of the environment. Yet through firms’ collaboration with governments and NGOs, some corporate eco-initiatives can actually have a positive effect on the environment.

Key idea 1 of 7

Eco-businesses are primarily motivated by profit and not by concerns for the health of the planet.

What comes to mind when you hear the term eco-business?

You might think about a company that restructures its business practices out of concern for the environment. But in fact, the pursuit of profit is the main driver of the eco-business trend.

How can this be? Well, increasing the sustainability of a company is, above all else, a great way to cut manufacturing costs and increase efficiency. In other words, becoming an eco-business allows a company to make and sell more goods.

The Fairmont Royal York Hotel in Toronto invested $25,000 CAD to upgrade its water systems as part of an energy conservation program. The result? A more efficient and less wasteful system that generated over $200,000 CAD in annual savings.

So from a business standpoint, being sustainable is smart. But isn’t it also good for society and the environment? Actually, not really. In the long term, eco-businesses have a negative impact on social justice and environmental conservation.

That’s because, as we’ve mentioned, supply chain efficiency facilitates accelerated production at lower per-unit costs. In other words, companies make more stuff for less.

As a result, the total environmental impact of an eco-business increases even as the per-unit consumption of water, energy, material and waste decreases.

Consider Coca-Cola. A decreased per-unit cost of production means lower costs, which allows the beverage company to meet increasing demand. But this accelerated production has had a taxing effect on its sugar cane suppliers. In fact, soil fertility in Papua New Guinea has dropped by 40 percent within the last two decades, due to increased production of sugar cane.

Coca-Cola’s story also hints at another influencing factor. As eco-business practices make corporations ever-more successful, their power over the economic system grows. And that’s why, according to the World Wildlife Fund, Coca-Cola has more power over commodity producers than does the United Nations.

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