A Level Business - Do Businesses Care About Being Green?

Well... do they?

It is thought that businesses have an obligation to pay attention to environmental issues and creates products or services which are “green”. This means that they will work with nature and thinks about ethics and effects. However, it could be argued that businesses should not spend their time on caring for the environment. Milton Friedman said that “the business of business is business”, which leaves no room for being green.

Although the sole aim of a business is to turn over a profit, some businesses do make it their goal to reduce their impact on the environment. Many companies look beyond the initial cost of changing their product or service to the benefits that being environmentally friendly brings. Simple things such as recycling can lower costs and drastically cut a business' carbon footprint. In addition to this, good practise is what some customers look for. A company that cares will put them on a pedestal compared to competitors, attracting new customers who value an honest product. Elkington's triple bottom line is often applied to businesses as it measures success beyond financial gains. With the inclusion of social and environmental issues, worth can be calculated. Working in a sustainable and respectable way is looked highly upon, and so would see the business have a higher total cost, suggesting that being green is something companies should care deeply about as it can ultimately improve their status. Dame Anita Roddick said that “being good is good business” and there are plenty of examples which too believe this is the same. Unilever believes that being sustainable has a positive impact on its business. Making reductions in carbon dioxide in manufacturing and using raw materials that are sustainably sourced, it is clear that the company is dedicating itself to the environment. As a whole, thy have managed to handle their money in a more efficient way and secure themselves as a household name for today, tomorrow and the future.

However, some companies show no signs of caring or respecting the environment or their employees. Large businesses that rely on being the cheapest in the market and following Michael Porter's concept of cost leadership simply cannot afford to be green. Sports Direct, Primark, RyanAir, Aldi, Lidl–these companies would struggle to keep their market share if they moved away from their current method of running their business. It would affect their reputation to rebrand themselves as an ethical or environmentally friendly company. Some companies go to extreme measures in order to seem like they are green; greenwashing convinces customers they are buying an environmentally friendly product. Typically, this is done in competitive markets as it gives companies a chance to stand out against their competitors and have an edge to draw more people in. An example is the multinational Coca Cola, who recently marketed their drink with a “PlantBottle” packaging which was later found to be incorrect and misleading. The bottle did not have any environmental benefits and has since been revised. Companies may be pushed by their shareholders to act in a way that sees their dividends rise, and so the creation of a unique selling point will stand out among competitors and see profits increase. The business will not really care about being green, and so will only exploit it.

To conclude, I believe that whether a business cares about being green depends on the type and size of the business. Sole traders will find it difficult to do this as there are cost implications and businesses will want to keep their market share and not jeopardise their reputation without knowing it will have immediate advantages. Noel Coward said that “the higher the buildings, the lower the morals”, suggest that the most successful businesses will only care about their finance. Companies that care about the environment may be rare, but some truly value the integrity and credentials of the business and will therefore be inclined to think and act in a greener way to satisfy their stakeholders.