This article introduces the practice and theory of environmental management. Discussion and analysis will include an overview and history of environmental management practices such as clean production and ecologically sustainable development. This article will also include an introduction to environmental regulation and environmental management systems (EMS). Two corporate case studies will be described and analyzed to illustrate environmental management and green business strategies in practice.
Keywords Clean Production; Ecologically Sustainable Development; Environmental Management; Environmental Management System (EMS); Environmental Regulation; Green Business
Businesses of all sorts, such as airlines, oil producers, car manufacturers, and paper mills, impact the environment. As a result, the field of environmental management developed to minimize the environmental impact of business operations as well as to satisfy increasingly strict environmental laws and regulations. Environmental management refers to the process of managing business operations or activities in the best way to minimize the impact, or the potential to impact, on the environment. Environmental management is motivated by governmental regulations, corporate goals, public expectations, environmental and material resources, and the potential for risk and liability.
The management approach that an individual business or industry chooses to manage their environmental issues depends on factors such as government legislation, local and global politics, community and customer expectations, and past history of environmental performance. Environmental management stakeholders include governments, regulators, customers, competitors, community and environmental interest groups, industry associations, and the environment itself (Delmas & Toffel, 2004).
Environmental management is part of the growing economic trend called green business. Green business practices, which refer to largely voluntary efforts at environmentally low-impact business practices, focus on sustainable products and practices. Examples include recycling, renewable energy, sustained-yield forestry, intelligent transportation systems, and healthy buildings designed with "green" materials.
Prior to the 1960s, there was no corporate accountability for the costs of environmental damages. Environmental costs were externalized to national governments and local communities. The practice of environmental management began, as a legislated activity and requirement of corporate behavior, in the 1960s and 1970s in response to growing concern about environmental pollution highlighted and publicized by pollution in Lake Erie, smog levels in Los Angeles, and the Rhine River catching fire from contaminants and pollutants. Government agencies, such as the United States Environmental Protection Agency (EPA) established in 1970, were formed, as explained by the Environmental Protection Agency's mission statement, to protect human health and to safeguard the natural environment-air, water, and land-upon which life depends. The U.S. Environmental Protection Agency encompasses environmentally-focused federal research, monitoring, standard-setting, and enforcement activities to ensure environmental protection (Anderson, 1999).
Environmental management, since its beginnings in the 1960s, has been characterized by the need to satisfy environmental regulations. Environmental regulation refers to state and federal statutes intended to protect the environment and wildlife, prevent pollution, save endangered species, and conserve water. Environmental regulations often grant individuals and organizations the right to bring legal actions to enforce the law.
Environmental regulation began in the United States with the Clean Water Act and the Clean Air Act. Regulation to address the problems of future and past hazardous waste disposal include the Resource Conservation and Recovery Act (RCRA) and the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) or the Superfund program. Environmental regulation began in Europe with a common environmental protection policy built into the Treaty of Rome (1987) and extended and expanded by the Treaty on European Union (1992). Environmental regulation has been criticized by businesses for ignoring production processes, being expensive, and excessive. Critics argue that environmental regulation has traditionally focused on "end-of-the pipe" solutions (such as emissions or waste control) rather than addressing the basic processes that created the problem initially (Anderson, 1999).
Environmental regulation, both design and content, is evolving to create and promote “gains in corporate environmental performance through the creation of a hybrid system of public regulation, government-supervised corporate self-regulation, mandatory information disclosure, and green procurement” or purchasing (Eisner, 2004, p. 145). In addition, the practice of managing environmental issues is transitioning from a regulatory phase to an increasingly common environmental management systems phase. The following section analyzes and discusses environmental management systems in corporations.
Environmental Management Systems
Within corporations, environmental management practices are increasingly formalized into environmental management systems (EMS). Environmental management systems, as described by the U.S. Environmental Protection Agency, refer to a set of processes and practices that enable an organization to systematically assess and manage its environmental footprint. Environmental management systems developed during the 1990s as the importance of environmental management increased in response to government and consumer pressure. Environmental management systems complement and, in some cases, substitute for environmental regulations (Jayathirtha, 2001). The Environmental Protection Agency bases its environmental management systems on the cyclical "Plan, Do, Check, and Act" model of management:
- Plan: Identify environmental issues and establish goals
- Do: Implement training and operational controls.
- Check: Monitor and take corrective action as necessary.
- Act: Review progress and act to make needed changes to the environmental management system (“Environmental,” 2006).
Environmental management systems are characterized by proactive activities rather than reactive activities. Environmental management systems, which can be used in factories, small businesses, service industries, and government agencies, come in many forms. Common corporate environmental management practices include clean production and ecologically sustainable development.
Clean production refers to the initiatives undertaken by businesses to reduce the environmental impact of production activities. Examples of cleaner production approaches include conserving of energy, reducing consumption of raw materials, decreasing use of and production of hazardous materials, and reducing waste. Benefits of cleaner production approaches include improved community relations as well as reduced operating costs and liability risks.
Ecologically sustainable development refers to the business practice of using, conserving, and enhancing the community's resources so that vital ecological processes are maintained for present and future generations. Ecologically sustainable development, which requires environmental, social, and economic cooperation, necessitates changes in the nature of production and consumption. Maintaining and conserving biodiversity, one of the main goals of ecologically sustainable development, refers to the variety of life form and the ecosystems in which they live (“Environmental,” 2006).
According to the Environmental Protection Agency, environmental management systems benefit corporate stakeholders in numerous ways (Johnson, 2005):
- Environmental management systems help an organization comply with its regulatory responsibilities and provide a means for addressing non-regulated environmental aspects such as energy efficiency and resource conservation.
- Environmental management systems facilitate assessment of risks and liabilities.
- Environmental management systems increase operating efficiency, create standard operating procedures, and capture institutional knowledge of experienced employees.
- Environmental management systems increase employees' environmental awareness and involvement throughout the organization.
- Environmental management systems offer potential environmental and financial benefits.
- Environmental management systems provide a competitive edge and improve public relations.
Environmental management systems are a generally cost effective approach to improving environmental performance. That said, there are costs associated with developing and implementing an environmental management system. These costs include:
- Investment of internal...
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