SUSTAINABILITY

Important Topics:

● EIA/SIA
● Certification
● LCA
● TBL
● Decoupling
● E P&L
● Sustainability Supply Chain Management
● CDP
● Circularity
● Product Sustainability

Sustainable Development
development that meets the needs of the present without compromising the ability of future
generations to meet their own needs.

Thus there are three dimensions that sustainability seeks to integrate: economic,
environmental, and social.
Economic interests define the framework for making decisions, the law of financial capital, and
the facilitation of commerce, including the knowledge, skills, competences and other attributes
embodied in individuals that are relevant to economic activity.
Environmental aspects recognize the diversity and interdependence within living systems, the
goods and services produced by the world's ecosystems, and the impacts of human wastes.
Socio-political refers to interactions between institutions/rms and people, functions expressive
of human values, aspirations and well-being, ethical issues, and decision making that depends
upon collective action.
I=P×A×T

I represents the impacts of a given course of action on the environment, P is the relevant
human population for the problem at hand, A is the level of consumption per person, and T
is impact per unit of consumption. Impact per unit of consumption is a general term for
technology, interpreted in its broadest sense as any human-created invention, system, or
organization that serves to either worsen or uncouple consumption from impact.

Jevons paradox
The principle that as technological progress increases the efficiency of resource utilization,
consumption of that resource will increase. Increased consumption that negates part of the
efficiency gains is referred to as rebound, while overconsumption is called backfire.

Strong sustainability, where tradeoffs among natural, human, and social capital are not
allowed or are very restricted, and weak sustainability, where tradeoffs are unrestricted or
have few limits.
Pollution is disproportionately borne by the lower and middle income countries such as India—
home to more than one-sixth of humanity.
Moreover, it is also due to the failure of the environmental administration, governance, and
regulatory infrastructure to keep pace with the magnitude and pace of economic growth in India
since economic liberalization in 1991.
1. Strengthening institutions and mechanisms that foster transparency and public
disclosure by pollution sources with the intent to increase access to and credibility of
information on pollution.
2. Wider adoption of market-based instruments that are more efficient than the traditional
command-and-control approaches on which India relies.
3. The legal infrastructure to facilitate expedited hearing of environmental litigation is being
created.

Environmental Regulatory Governance in India

The Water Act, the Air Act, and the Environmental Protection Act—firmly established a so-called
command-and-control (CAC) approach to the environment.

Environmental Impact Assessment Regulation

The first EIA notification in 1994 required prior approval by the MoEF to set up 29 types of
industries.The EIA regulation requires the project proponents to conduct an ex ante assessment
of biophysical (e.g., on air, water, land, and natural ecosystems such as forests, marine
ecosystems, and coastal zones) as well as social (e.g., local communities) impacts of
construction and operation of their projects and propose an environmental management plan to
mitigate potential impacts.
The perceived trade-off between economic growth and environmental protection underlies the
contestations surrounding the EIA regulation

It was in this context that common effluent treatment plants (CETPs) emerged as a “solution” to
the water pollution problem in clusters. CETPs take advantage of the clustering of industries to
transport effluents from individual industrial units to one common location and treat the
combined wastewater to the prescribed standards.
The first waste regulation enacted was the Hazardous Waste (Management and Handling)
Rules, 1989, followed by several regulations targeting different streams of waste

The active role that the SC and state high courts play in Indian environmental regulatory
governance is, on the one hand, viewed as essential to counter the failures of the executive in
effectively implementing regulation. On the other hand, the overdependence on the courts
raises questions about whether the SC is “usurping the executive branch’s constitutional
obligation to protect the environment.

Another unique feature of India’s environmental regulations is the special environmental court,
the NGT, set up in 2010 under legislation enacted by the Indian Parliament, the National Green
Tribunal. The other important features of the NGT include (a) decision-making based on the
application of certain foundational principles—principles of sustainable development, polluter
pays principle, and precautionary principle—enshrined in international environmental law; (b)
expanding access to environmental justice through a broad definition of “aggrieved person” to
include “any representative body or organization” (NGT Act, 2010, p. 8); (c) strict penalties (jail
term and/or monetary penalty) for violation of orders; and (d) 14 categories of damages under
which compensation or relief can be claimed.

The Future of Environmental Regulations in India

1. First, the tension between developmental concerns and deteriorating environmental
quality will continue to be one of the central features of the debates surrounding
environmental regulations
2. Second, India’s experiments with alternative instruments such as market-based
instruments and public disclosure programs are likely to continue.
 3. Third, public activism, especially by approaching higher courts, has been instrumental in
the small gains that India has made in controlling pollution through environmental
regulations.

GDP
GDP measures mainly market transactions. It ignores social costs, environmental impacts and
income inequality. Maximize gross revenue — even at the expense of profitability, efficiency,
sustainability or flexibility. That is hardly smart or sustainable.
Soaring economic activity has depleted natural resources. Much of the generated wealth has
been unequally distributed, leading to a host of social problems.

Genuine progress indicator (GPI).

This metric is calculated by starting with personal consumption expenditures, a measure of all
spending by individuals and a major component of GDP, and making more than 20 additions
and subtractions to account for factors such as the value of volunteer work and the costs of
divorce, crime and pollution.
The most comprehensive of these is the World Values Survey (WVS), which covers about 70
countries and includes questions about how satisfied people are with their lives
Another example is the gross national happiness index used in Bhutan. This measure uses
elaborate surveys that ask how content people feel in nine domains: psychological well-being,
standard of living, governance, health, education, community vitality, cultural diversity, time use
and ecological diversity.
One example is the Happy Planet Index, introduced by the New Economics Foundation in
2006. This multiplies life satisfaction by life expectancy and divides the product by a measure of
ecological impact.

There is broad agreement that global society should strive for a high quality of life that is
equitably shared and sustainable

National Clean Air Programme (NCAP). The goal of the Programme is to reduce particulate
pollution by 20-30 percent relative to 2017 levels by 2024. Though the NCAP’s goals are
nonbinding, if India does achieve and sustain this reduction, it would lead to remarkable health
improvements: a nationwide reduction of 25 percent, the midpoint of the NCAP’s target, would
increase India’s national life expectancy by 1.8 years, and by 3.5 years for residents of Delhi.

THE AIR QUALITY LIFE INDEX (AQLI) The AQLI is a pollution index that translates particulate
air pollution into perhaps the most important metric that exists: its impact on life expectancy. It
quantifies the causal relationship between long-term human exposure to air pollution and life
expectancy. The Index then combines this research with hyper-localized, global particulate
measurements, yielding unprecedented insight into the true cost of particulate pollution in
communities around the world. The Index also illustrates how air pollution policies can increase
life expectancy when they meet the World Health Organization’s guideline for what is
considered a safe level of exposure, existing national air quality standards, or user-defined air
quality levels.

Resource efficiency means to create more output as products/services using less inputs. It
reduces waste, drives greater resource productivity, delivers a more competitive economy,
addresses emerging resource security/scarcity issues, and helps reduce the associated
environmental impacts.

Circular economy keeps resources in use for as long as possible extracting the maximum
value, recovering and regenerating products and materials at the end of each service life; so as
to limit the extraction of natural resources to maximum possible extent

The 2030 Agenda for Sustainable Development comprises 17 Sustainable Development Goals
or SDGs.

Biotic resources are obtained from the biosphere (living and organic material) eg. forests and
animals, and the materials that can be obtained from them. Abiotic resources are those that
come from non-living, non-organic material including land, fresh water, air, rare earth metals
and heavy metals including ores such as gold, iron, copper, silver, etc. Secondary Raw
Materials (SRM) are recycled materials that can be used in manufacturing processes instead of
or along with virgin raw materials.

Life Cycle Analysis is a holistic and systematic assessment of environmental impacts

associated with all the stages of a product’s life from raw material extraction, material
processing, product manufacturing, use and maintenance, disposal or recycling.

Resource efficiency (RE) implies judicious use of earth’s limited resources to achieve
maximum benefit for sustained human well-being while minimizing the adverse impacts on
environment. It is the ratio between a given benefit or result and the natural resources use
required for it. While the term ‘resource efficiency’ is predominantly used in business, product
or material context; term ‘resource productivity’ is used in context of regional or national
economy. Resource efficiency reduces waste, drives greater resource productivity, delivers a
more competitive economy, addresses emerging resource security/scarcity issues, and helps
reduce the environmental impacts associated with both production and consumption.
Circular Economy (CE) is an alternative to the traditional linear economy in which resources
are kept in use for as long as possible, extracting the maximum value, recovering and
regenerating products and materials at the end of each service life.

6Rs Principle is key to drive resource efficiency and refers to reduce, reuse, recycle, refurbish,
redesign and remanufacture. Reduce means to require less use of material, reuse is the use of
goods or items again by different set of consumers or by re-purposing them for a different use,
recycle means transformation of the good into raw material that can be reshaped into a new
item, refurbish means restoration of a used product for its intended use by performing minor
alterations, redesign means to rethink the design of a product to minimize use of materials,
facilitate recyclability and reduce environmental impacts, and remanufacture means rebuilding
a product to specifications of the original product using reused, repaired and new parts.

Cost of Resource Efficiency Policy

The multi-dimensional benefits of resource efficiency will drive the agenda of resource
efficiency. Cost savings from the reduced material use and regulatory instruments as polluters
pays-principle, precautionary principle, differential pricing of virgin raw materials, landfill
taxes/ban etc. will provide economic impetus to resource efficiency. Consistent, well-defined
and efficient pro-resource efficiency and environmental regulations together with the existing
support system for SMEs will enhance development of innovative business models to further the
cause of resource efficiency.

The National Resource Efficiency Policy envisions a future with environmentally sustainable
and equitable economic growth, resource security, healthy environment (air, water and land),
and restored ecosystems with rich ecology and biodiversity.

Massive potential of using increased efficiency as a cost effective way to protect resources,
tackle climate change and reduce our environmental footprint, while boosting economic growth,
employment and development.

The extraction and use of resources also creates environmental impacts, such as land
degradation, biodiversity loss, and water and air pollution. There is great potential to address
these concerns through increased resource efficiency and productivity. This involves adding
greater value to resources, maintaining that value by keeping resources in use for longer, and
reducing the environmental impacts associated with the whole life cycle of resources, from their
extraction to their disposal. Moreover, greatly increased resource efficiency will be necessary to
meet the aspirations expressed in the Sustainable Development Goals (SDGs), agreed by the
United Nations in September 2015, and the Paris Agreement on climate change adopted at the
COP21 Climate Conference in December 2015.

Improving human well-being (the measurement of which is both challenging and contentious) or
increasing economic output (which is more straightforward to measure), while proportionately
reducing both resource use (resource decoupling) and negative environmental impacts
(impact decoupling) is a process known as double decoupling. Such decoupling is
“relative” when resource use and environmental impacts increase more slowly than
economic output or “absolute” when resource use and environmental impacts fall while the
economy continues to grow.

G7 industrialized economies (the United States, Japan, Germany, the United Kingdom, France,
Italy and Canada) tend to have much higher resource use per capita than their BRICS
counterparts (Brazil, Russia, India, China, South Africa), although the gap has narrowed
significantly in recent years. This indicates significant potential for resource decoupling in the
BRICS economies as they grow. However, this divergence can also be partly attributed to the
effects of international trade flows, which allow G7 countries to shift resource-intensive
production to BRICS (or developing) countries.

Many measures that increase resource efficiency also result in improved corporate performance
and competitiveness that can save consumers money and/or increase consumer satisfaction.

Such failure to achieve win-win benefits from resource efficiency can be due to a “rebound
effect”, the phenomenon whereby financial savings arising from increased resource efficiency
are then spent in ways that increase resource consumption, negating – either partially or wholly
– the reduction in resource use achieved by the efficiency measure.

Nonetheless, public policy measures are required to achieve the absolute decoupling of
resource use. Such measures are implemented through resource and environmental
governance processes.
Despite the obvious cost savings, there are many reasons why both businesses and consumers
do not use resources efficiently

Globally, ISO 14001 is the most widely recognised and most frequently used standard for
environmental management systems.

Corporate SRTs can be divided into a few categories: frameworks; standards; ratings and
indices. Frameworks typically refer to principles, initiatives or guidelines provided to
corporations to assist them in their disclosure efforts. Standards have similar function as
frameworks but exist in the form of more formal documentation that spell out the requirements,
specifications or characteristics that can be used to ensure that sustainability efforts are
consistently achieved. Ratings and indices are third party evaluation of a corporation's
sustainability or ESG performance. The major tools in each of these categories are reviewed
here for the reader

The SIGMA Project describes a four-phase cycle (leadership and vision; planning; delivery;
monitor, review and report) broken down into three to five levels each to manage and embed
sustainability within a corporation.

The United Nation's (UN) Global Compact promotes ten principles across areas such as
human rights, labour, environment and anti-corruption. It seeks the co-operation of corporations
to embrace and support these principles within their sphere of influence.

The CDP is an independent non-profit corporation which holds one of the largest database on
disclosure of greenhouse gas emissions, water use and climate change strategies on a global
scale.

The World Business Council for Sustainable Development (WBCSD) consists of the world's
leading corporations across a wide range of industry sectors. WBCSD offers a range of tools to
support the embedment of sustainability into corporate strategy and operations such as the
GHG Protocol, Sustainable Forest Finance Toolkit and the WBCSD Measuring Impact
Framework to name a few.

Greenhouse Gas (GHG) Protocol was initiated through a joint collaboration between the World
Business Council for Sustainable Development (WBCSD) and the World Resources Institute
(WRI) to develop effective programs for tackling climate change.

ISO 26000 standard for social responsibility covers subjects across the entire CSR domain,
providing guidance instead of being a certifiable management systems standard that contains
requirements and propagates a dominantly moral rather than strategic perspective on CSR.

Signalling Theory: ST is concerned with how one entity—the agent or insider—may undertake
actions to signal its underlying quality to reduce information asymmetries. This underlying
quality is often hard to observe or unobservable to another entity—the principal or outsider. ST
therefore revolves around “problems of social selection under conditions of imperfect
information”
ST’s primary focus is on information asymmetries between two entities, the signaller and the
signal receiver. However, in the realm of CSR, firms experience strong incentives to signal their
CSR quality. Receiver attention for signals of CSR quality has surged
Consequently, this spree of CSR communication causes relationships between firms and their
stakeholders to be characterised by two types of information asymmetries in particular: within-
firm and between-firm information asymmetries. Within-firm information asymmetries concern
the inherent opacity of underlying CSR quality and its relative unobservability to stakeholders. In
many cases, a firm’s CSR quality is hard to observe or even unobservable for transacting
partners due to the prevalent orientation of CSR activities on internal business processes rather
than its integration in the development of new products, the exploration of new markets and the
innovation of business models
A second type of information asymmetries relates to between-firm observability and concerns
the idiosyncrasy of the CSR concept. The contested, multifaceted, and vague nature of CSR
requires company-specific interpretations of the concept to acquire meaning

Conclusions
In the context of public-private governance for sustainability, CSR and sustainability standards
have a particular and potentially promising role to play as form of “governance beyond
government”. Firms have clear incentives to signal their underlying CSR quality and many have
opted for adhering to CSR standards as way of reducing information asymmetries in their
relationships with stakeholders. The ISO 26000 standard is a prominent case in point and may,
in the context of realising both public values and business goals, serve as a signalling device for
firms aiming to communicate their CSR quality. However, despite the high level of legitimacy
ISO 26000 possesses based on its inclusive, Sustainability 2018, 10, 4172 15 of 20 multi-
stakeholder-oriented development process and the practical value its CSR framework offers
adopters, firms adhering to the standard risk emitting a rather weak signal. Analysing the
standard with ST shows that the standard satisfies neither characteristic of an efficacious signal
(observability and costliness) and signal honesty and signal fit may be rather low. In addition,
the standard appears to lead to problems of signal frequency and signal consistency. The low
exigencies of ISO 26000, including it lacking an enforcement mechanism, are a root cause of
these problems. Firms may consequently be tempted to signal underlying CSR qualities that
they actually do not possess. This can lead ISO 26000 to become a signal of companies with
poor CSR performance and even a standard for greenwashing. In addition, the idiosyncratic
approach to CSR that the standard propagates requires a lot of effort from stakeholders to
observe and assess the CSR quality of ISO 26000-adhering firms. The standard thus adds
proof to the obfuscation hypothesis and by creating uninformative pooling equilibriums does not
seem to be suited for differentiation purposes. Against this background, when adopting or
encouraging the use of ISO 26000, firms and governments may well compromise the promise of
public-private governance of sustainability. The fact that ISO 26000 was not developed as a
certifiable management systems standard has led to the emergence of other CSR standards
that make CSR better observable, thus enhancing between-firm information asymmetries to its
disadvantage. The analysis in this article points at the necessity of using of additional signalling
strategies for firms that adhere to ISO 26000, including self-declaration and the adoption of
certifiable (issue-based) CSR standards. However, as the standard necessitates firms to turn to
alternative signalling strategies, stakeholders may be more likely to misinterpret and get
confused by a firms CSR signals. From the perspective of public-private governance, the
question should hence be raised whether ISO 26000 is an appropriate standard to further
engage firms (and other organisations that want to use this guidance) in the sustainability
agenda, for instance by policymakers in the social and environmental realm. Interestingly,
governments have been a contributor to the multi-stakeholder process that has led to the
creation of ISO 26000, too, and the interest of public authorities in private governance has been
on the increase. In addition, certification is not a solution for the signalling problems voluntary
standards engender per se [1]. In the final analysis, it may be said that the differentiating
characteristics of ISO 26000, including the fact that it is not certifiable and allows for
idiosyncratic interpretations of CSR, can easily compromise its value. Images of realising public
values may actually be not much more than a cover for achieving the same business goals as
ever. In the context of public-private governance, such greenwashing may well tarnish not only
the credibility of business, but also that of other partners involved, including governments and
non-governmental organisations. Against the background of the results of the numerous studies
mentioned in this article that point at the drawbacks of private and public-private governance in
general and CSR and sustainability-related standards in particular, the question then is: Where
does this leave the potential value of ISO 26000 for public-private governance? Perhaps a
starting point for getting to the most viable answer to this question can be found in the
conclusion reached by Mayer and Gereffi ([108], p. 19) on private governance: “unless private
governance is supplemented and reinforced by public institutions of governance, it cannot
provide adequate governance capacity for the global economy” However, to avoid solely
resorting to the route of legislation and in order to honour the central idea of public-private
governance, ISO 26000 may function as a platform for public and private institutions to discuss,
negotiate and mutually enforce the responsibilities, initiatives and outcomes of both firms,
governments and non-governmental organisations in achieving sustainability. This may take the
form of continuous and transparent stakeholder dialogue as a way of aligning interests and
securing accountability mechanisms that may make the signals emitted credible and less
susceptible to misinterpretation. The agenda offered by the United Nations Sustainable
Development Goals (SDGs) and the consequent initiatives taken by governments, non-
governmental organisations (including citizen-led initiatives) and firms worldwide to promote and
achieve this agenda may be an emerging (although embryonic) example in this regard. Such an
approach may result in the adoption of a variety Sustainability 2018, 10, 4172 16 of 20 of
idiosyncratic public-private governance arrangements, each characterised by their own
signalling strategies [4], including the involved parties auditing each other and communicating
the results of this process in a fully transparent way. Inclusive, global partnerships, either
directly targeted at activities to tackle the SDGs or aimed at creating new public-private
governance arrangements (including standards) may be an example of this. Paradoxically, as
the analysis in this article has shown, ISO 26000 may discourage precisely those investments
that are necessary to develop and send credible signals of current and future CSR performance
that reduce information asymmetries in firm-stakeholder relationships that firms need in order to
capitalise on their CSR efforts. Not being able to capitalise on their efforts may hinder taking up
their role in the public-private governance of sustainability beyond complying with legislation.
However, this does not say that ISO 26000 will not be taken up by firms worldwide—surveys
among businesses actually indicate that the adoption of the standard has gained traction—or
that the standard will be discouraged through public policy or supported by non-governmental
organisations. Firms, their stakeholders, governments and organisations involved in the
standardisation of business conduct should be aware of the signals firms emit by ISO 26000 in
order to not let the standard become part of the problems it set out to solve and exacerbate
rather than reduce problems in public-private governance.

Ecological fiscal transfers (EFT): EFT transfers public revenue between governments within a
country based on ecological indicators. Here, ‘ecological’ refers to ecological public functions of
governments , which encompass both nature conservation and abatement of environmental
pollution. EFT may transfer revenue ‘vertically’ from higher-level to lower-level governments or
‘horizontally’ between governments at the same level.

Product sustainability is usually looked at from a business perspective with the goal to reduce
product related risks or to differentiate the product from those of the competition - mostly with
limited effects for sustainable development (SD).
Product sustainability (PS) looks at how products can provide economic benefits to companies
while at the same time providing environmental and social benefits to society in general. Or, in
other words, PS aims at balancing the contributions of products to the triple bottom-line,
thereby creating multiple and shared values for different stakeholders.
While early approaches were focusing on balancing economic and environmental benefits, the
discussion later moved on to address sustainability problems in all its dimensions. And while the
discussions revolved for long around minimizing the negative impacts of products, more recent
approaches have started to focus on positive impacts, thereby aiming for net-positive products.

Product Sustainability 1.0 will be characterized by developments that move from selective
improvements to holistic improvements of products, thereby going beyond specific
improvements of products.

Product Sustainability 2.0 will be characterized by developments from “better products” to

“good products”. Better products are defined in a relative way, typically by comparing them to
existing products or alternative solutions on the market. Good products, however, are defined by
comparing them to some absolute measure or given standard of sustainability performance

Product Sustainability 3.0 will be characterized by developments from product value to

societal value. On this highest level it is not sufficient any more to contribute to a sustainable
product, but to contribute to a sustainable world

In a first phase of a developing concept of business sustainability, companies are confronted

with social and ecological concerns from outside their markets which put them under pressure
to act. Companies recognize that through sustainability management they can save costs and
reduce risks, they can increase their reputation on the job market as well as their differentiation
in the product markets.

In a second phase sustainability is being increasingly institutionalized inside the company.

Companies start broadening their stakeholder perspective and pursuing a triple bottom line
approach. Value creation goes beyond shareholder value and includes social and
environmental value

The third phase requires two different things, a shift from “Inside-Out-Thinking” to “Outside-In-
Thinking”, i.e. when the company starts from society and its problems and then asks itself which
opportunities arise by contributing to solving societal challenges? But also a shift from a focus
on reducing negative impacts to making a positive contribution

For companies to contribute to sustainability, innovation plays an important role.

On a first level, called “operational optimization”, companies focus on “doing the same things
better”. They comply with changing regulations or pursue efficiency gains while they focus on
mostly internal and incremental innovations. The innovation outcome is a reduction of harm.

On a second level, which they call “organizational transformation”, companies focus on “doing
good by doing new things”. They develop new products, services or business models, which
may include a shift in company purpose. The innovation outcome moves from reduction of harm
to creating shared values with societal stakeholders.

On a third level, called “systems building”, companies focus on “doing good by doing new
things with others” whereby they start thinking beyond the firm and reframe the purpose of
business in society. They develop product offerings they could not achieve by themselves, but
require collaboration and partnerships with diverse stakeholders.

The model of PS most often referred to in theory and - in particular - in practice centers around
the idea of a “green product”, which optimizes the product’s eco-efficiency over the whole
product life cycle by use of “eco-design” or “design for environment”. It has been integrated into
different ISO standards (ISO 14040, 14006, 14001) where it is referred to as “cradle-to-grave
product life cycle perspective”. Its focus is exclusively on the environmental dimension of
sustainability.
Its goal is to avoid trade-offs and burden shifting between life cycle phases, but also to help
define priorities for effective action.
A product is considered to be “green” or “sustainable” when the aggregate environmental
burden is lower than the one of competitive products or previous product editions.

“Although no consumer product has a zero impact on the environment, in business, the terms
‘green products’ or ‘environmental product’ are used commonly to describe those that strive to
protect or enhance the natural environment by conserving energy and/or resources and
reducing or eliminating use of toxic agents, pollution, and waste”

The key instrument for product life cycle management, however, is the environmental Life
Cycle Assessment (eLCA). The eLCA summarizes, visualizes, quantifies and interprets
impacts of a product’s production, processing, use and recycling phases on the environment. An
eLCA includes the use of resources, water, and energy in the same way as it considers
greenhouse gas emissions, the pollution of soil and water, or generated waste (Rebitzer et al.,
2004). Thereby it is more holistic than footprint calculations which typically focus on singular
indicators. Due to significant issues related to definitions of system boundaries and impact
calculations, the International Organization for Standardization (ISO) has released a formal
guide for performing life cycle assessments. ISO 14040 defines a life cycle as “consecutive and
interlinked stages of a product system, from raw material acquisition or generation from natural
resources to final disposal” (ISO 14040, 2006). According to ISO 14040, all goods and services
have an impact on the environment, which can occur at any or all life cycle phases, while
impacts can be manifold, slight or significant, short-term and long-term, and may occur at a
local, regional, and/or global level.
The eLCA is often used as an eco-design tool. Eco-Design (also called “Design for
Environment”) has been defined in an ISO guide as “the integration of environmental aspects
into product design and development, with the aim of reducing adverse environmental impacts
throughout a product’s life cycle”

The PEF is a multi-criteria environmental measure of a good or service throughout its life cycle
that allows companies to demonstrate the environmental performance of their products or
services to customers and the public in a more trustful way.

Three such concepts that can be seen as completing the dominant model of product
sustainability: design for sustainability, cradle-to-cradle, and product-service systems

Thereby the eLCA is complemented by social life cycle assessment (sLCA) and life cycle
costing (LCC). The sLCA focuses on social aspects of a product and its upstream and
downstream processes and includes the product utility and social acceptability of products.
Together with the economic evaluation through LCC, eLCA and sLCA can be combined to a
comprehensive Life Cycle Sustainability Assessment (LCSA) that considers all three
dimensions of sustainability (Valdivia et al., 2013). LCSA reveal trade-offs as well as trade-ons
between different sustainability dimensions, life cycle phases and impacts. Thereby, the LCSA
aims at reducing a product’s negative footprint while simultaneously improving its socio-
economic performance throughout its life cycle.

Cradle-to-Cradle (C2C) aims for reducing the negative environmental impacts by closing the
product loop. Traditionally the product life cycle is seen as a linear process, reaching from raw
material extraction to end of life treatment and disposal, with resource consumptions, emissions
and waste at each stage. McDonough & Braungart introduced in 2002 the C2C concept, where
products are reused or remanufactured at the end of their lives. While the classical life cycle
assessment adapts a “cradle to grave” perspective, “cradle to cradle” tries to establish a
continuous cycle of outputs and inputs

The basic idea of dematerialization is that those products have the best environmental
performance, which are not produced in the first place. The end point of this line of thought is
dematerialization, where customer needs can be satisfied through services, without the need for
a physical product. This product sustainability approach is in line with larger societal changes
concerning the transformation from industrial economies to service economies and the
increasing popularity of a sharing economy.

“A PSS is an integrated product and service offering that delivers value in use. A PSS offers the
opportunity to decouple economic success from material consumption and hence reduce the
environmental impact of economic activity.”

In general, three approaches to PSS can be distinguished: (1) services providing added value
to the product life cycle, (2) services providing “final results” for customers, or (3)
services providing “enabling platforms” for customers
In the first case, companies provide additional services along with the classical product. The
product is still sold to the customer, but offered in a package with i.e. maintenance, repair, up-
grading or substitution services over a specific time period. In this case, the physical product is
not changed and the environmental product life cycle performance is only marginally improved.
In the second case, the company remains owner of the product, but satisfies the needs of the
customer through a specific mix of services. An example is the purchase of pest control services
in agriculture, which substitute the purchase of agrochemicals by the provision of a service to
take care of occurring pests. In the third case, the customer rents or leases the product and
pays only for the time he uses the device. As the producer remains owner of the physical
product, this type of PSS should induce companies to invest in the durability, efficiency and
reparability of their physical offerings. The extended lifespan and the collective use of one
physical item by several customers may greatly reduce environmental burdens through a
reduced amount of manufactured products. Benefits may not only occur in terms of
environmental sustainability, decreased resource dependencies and reduced energy
consumption, but also in terms of new market development, increased flexibility, more intense
client relationships, an improved corporate identity, and an improved market and strategic
position. PSS may foster the shift towards a service economy, a reduced customer focus on
product ownership and a higher acceptance of dematerialized consumption

The ambition is no longer to simply get to “better products”, but to aim for “good products”.
These approaches are presented under the labels of “Upcycle”, “Handprinting” and “Net
Positive”

Upcycle
“basically making a suboptimal system more efficient by curtailing how much “bad” it produces:
not doing the right things, but doing the wrong things better”

Handprinting
“the good we do for the environment“ (2013). It is a reverse logic compared to the footprint
thinking. While reducing a footprint towards zero gets increasingly difficult e and in most cases
of physical products even impossible e increasing a positive handprint may resemble a
perpetuum mobile. Instead of working towards a “neutral impact” product, certain unavoidable
interferences with the environment are accepted, but counterbalanced by positive actions. They
highlight the unlimited potential of handprinting as positive impacts sustain themselves as long
as the product is produced or used and may accumulate over time

Net positive
ILFI already incorporated net positive thinking into its Living Product guideline, by asking
companies to go beyond generating handprints and ultimately aiming for net positive
contributions.
‘Net Positive’ simply means putting more back into the environment or society than a company
takes out, with a resulting positive corporate footprint

A final phase in the evolution of PS models is reached with a changing focus from customer
value to societal or public value. While the early concepts were addressing a range of negative
product impacts with the aim to find ways to reduce these (negative) footprints, only recently
newer concepts started to discuss positive product impacts. The ambition and goal progressed
from product handprinting to becoming overall net positive, thereby moving on from making
better products to making good products. A final phase in this evolution is reached with a shift in
focus from generating product value for the consumers alone to also contributing value to
society. A non-directed and often incidental contribution to society through net positive products
is being replaced by a more directed and deliberate contribution to solving relevant societal
issues. This is what we would qualify as “true product sustainability”

An Environmental Profit & Loss Account is a means of placing a monetary value on the
environmental impacts along the entire supply chain of a given business.

FOUR PLANETARY BOUNDARIES HAVE BEEN CROSSED: Climate Change, Loss Of

Biosphere Integrity, Land-system Change, Altered Biogeochemical Cycles (Phosphorus and
Nitrogen) Climate change and biosphere integrity, are “CORE BOUNDARIES".
Social Impact Assessment
Social Impact Assessment includes the processes of analysing, monitoring and managing the intended
and unintended social consequences, both positive and negative, of planned interventions (policies,
programs, plans, projects) and any social change processes invoked by those interventions. Its primary
purpose is to bring about a more sustainable and equitable biophysical and human environment.

The important features of this definition are that:

1. The goal of impact assessment is to bring about a more ecologically, socio-culturally and
economically sustainable and equitable environment. Impact assessment, therefore, promotes
community development and empowerment, builds capacity, and develops social capital (social
networks and trust).
2. The focus of concern of SIA is a proactive stance to development and better development
outcomes, not just the identification or amelioration of negative or unintended outcomes.
Assisting communities and other stakeholders to identify development goals, and ensuring that
positive outcomes are maximized, can be more important than minimizing harm from negative
impacts.
3. The methodology of SIA can be applied to a wide range of planned interventions, and can be
undertaken on behalf of a wide range of actors, and not just within a regulatory framework.
4. SIA contributes to the process of adaptive management of policies, programs, plans and projects,
and therefore needs to inform the design and operation of the planned intervention.
5. SIA builds on local knowledge and utilises participatory processes to analyse the concerns of
interested and affected parties. It involves stakeholders in the assessment of social impacts, the
analysis of alternatives, and monitoring of the planned intervention.
6. The good practice of SIA accepts that social, economic and biophysical impacts are inherently
and inextricably interconnected. Change in any of these domains will lead to changes in the other
domains. SIA must, therefore, develop an understanding of the impact pathways that are created
when change in one domain triggers impacts across other domains, as well as the iterative or
 flow-on consequences within each domain. In other words, there must be consideration of the
second and higher order impacts and of cumulative impacts.
7. In order for the discipline of SIA to learn and grow, there must be analysis of the impacts that
occurred as a result of past activities. SIA must be reflexive and evaluative of its theoretical bases
and of its practice.
8. While SIA is typically applied to planned interventions, the techniques of SIA can also be used to
consider the social impacts that derive from other types of events, such as disasters,
demographic change and epidemics.

SIA is best understood as an umbrella or overarching framework that embodies the evaluation of all
impacts on humans and on all the ways in which people and communities interact with their socio-cultural,
economic and biophysical surroundings. SIA thus has strong links with a wide range of specialist sub-
fields involved in the assessment of areas such as: aesthetic impacts (landscape analysis);
archaeological and cultural heritage impacts (both tangible and non-tangible); community impacts; cultural
impacts; demographic impacts; development impacts; economic and fiscal impacts; gender impacts;
health and mental health impacts; impacts on indigenous rights; infrastructural impacts, institutional
impacts; leisure and tourism impacts; political impacts (human rights, governance, democratisation etc);
poverty; psychological impacts; resource issues (access and ownership of resources); impacts on social
and human capital; and other impacts on societies. As such, comprehensive SIA cannot normally be
undertaken by a single person, but requires a team approach.

Environmental Impact Assessment

Environmental Impact Assessment (EIA) as a tool used to identify the environmental, social and
economic impacts of a project prior to decision-making. It aims to predict environmental impacts at an
early stage in project planning and design, find ways and means to reduce adverse impacts, shape
projects to suit the local environment and present the predictions and options to decision-makers.

The EIA Process

EIA involves the steps mentioned below.
However, the EIA process is cyclical with interaction between the various steps.
Screening: The project plan is screened for scale of investment, location and type of development and if
the project needs statutory clearance.
Scoping: The project’s potential impacts, zone of impacts, mitigation possibilities and need for
monitoring.
Collection of baseline data: Baseline data is the environmental status of study area.
Impact prediction: Positive and negative, reversible and irreversible and temporary and permanent
impacts need to be predicted which presupposes a good understanding of the project by the assessment
agency.
Mitigation measures and EIA report: The EIA report should include the actions and steps for
preventing, minimizing or by passing the impacts or else the level of compensation for probable
environmental damage or loss.
Public hearing: On completion of the EIA report, public and environmental groups living close to project
site may be informed and consulted.
Decision making: Impact Assessment Authority along with the experts consult the project-incharge along
with consultant to take the final decision, keeping in mind EIA and EMP (Environment Management Plan).
Monitoring and implementation of environmental management plan: The various phases of
implementation of the project are monitored.
Assessment of Alternatives, Delineation of Mitigation Measures and Environmental Impact
Assessment Report: For every project, possible alternatives should be identified, and environmental
attributes compared. Alternatives should cover both project location and process technologies. Once
alternatives have been reviewed, a mitigation plan should be drawn up for the selected option and is
supplemented with an Environmental Management Plan (EMP) to guide the proponent towards
environmental improvements.
Risk assessment: Inventory analysis and hazard probability and index also form part of EIA procedures.

Stakeholders in the EIA Process

● Those who propose the project
● The environmental consultant who prepare EIA on behalf of project proponent
● Pollution Control Board (State or National)
● Public has the right to express their opinion
● The Impact Assessment Agency Regional centre of the MoEFCC

Importance of EIA

● EIA links environment with development for environmentally safe and sustainable development.
● EIA provides a cost effective method to eliminate or minimize the adverse impact of
developmental projects.
● EIA enables the decision makers to analyse the effect of developmental activities on the
environment well before the developmental project is implemented.

Shortcomings of EIA Process

● Applicability: There are several projects with significant environmental impacts that are
exempted from the notification either because they are not listed in schedule I, or their
investments are less than what is provided for in the notification.
● Quality of EIA: One of the biggest concerns with the environmental clearance process is related
to the quality of EIA report that are being carried out.
● Lack of Credibility: There are so many cases of fraudulent EIA studies where erroneous data
has been used, same facts used for two totally different places etc.

Environmental Profit and Loss

The Environmental Profit & Loss account is a method for placing a monetary (relating to money) valuation
on a company’s environmental impacts. Including the environmental and social impact derived from all its
business operations and the entire supply chain. This scope on what parts of your business operations
you want to measure is also called from ‘cradle-to-grave’.
An EP&L account is calculated through a Life Cycle Assessment (LCA). In an EP&L, LCA Midpoint
indicators (environmental impact categories from LCA’s) are calculated and subsequently monetized

Why is EP&L so useful?

An EP&L account is expressed in economical valuations (£, $ and €) instead of different environmental
impact outcomes such as kg CO₂-eq or kg CFC-11-eq. This enables organizations to compare and
consolidate different types of environmental impact (such as global warming potential, particulate matter
or toxicities). Environmental impact can now be expressed in a single indicator.

EP&L expresses sustainability in terms that all businesses understand. It talks money.

This is why it’s an incredibly effective way for companies to take the proper sustainable decisions and
implement a profitable sustainability policy. It’s no surprise that an EP&L increasingly becomes desired
information on capital and environmental risks for investors.

PUMA

Their EP&L account from 2019 revealed that 63% of their total environmental footprint comes from their
raw material processing (38% = €270 million) and production (25% = €177.8 million). Therefore, Puma
has decided to prioritize the large-scale use of more sustainable raw materials.

Sustainability Supply Chain Management

Supply Chain Sustainability : Supply chain sustainability refers to companies’ efforts to consider the
environmental and human impact of their products’ journey through the supply chain, from raw materials
sourcing to production, storage, delivery and every transportation link in between. The goal is to minimize
environmental harm from factors like energy usage, water consumption and waste production while
having a positive impact on the people and communities in and around their operations.

While conventional supply chain management focuses on the speed, cost and reliability of operations,
sustainable supply chain management adds the goals of upholding environmental and societal values.
This means addressing global issues such as climate change, water security, deforestation, human rights,
fair labor practices and corruption.

How can a SC be sustainable?

Companies around the world have taken steps to lower their carbon emissions, cut back on waste and
improve labor conditions. By tracking sustainability metrics in supply chain management (SCM) systems,
they monitor multifaceted programs that, for example, prioritize renewable energy, recycle products and
materials or encourage greater social responsibility among suppliers.

CDP
Carbon Disclosure Project, CDP is an international nonprofit organization.
CDP’s goal is to make environmental reporting and risk management a business norm that
drives disclosures, insights, and action towards a sustainable economy.