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Topic 3
Sustainability:
Ethical and Social
Responsibility
Dimensions

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Learning Objectives

• Introduction to Sustainability
• Sustainability for Business
• Benefits of sustainability
• Review environmental legislation related to sustainability
• How businesses should response to sustainability demands

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The potential for the long-

term wellbeing of the natural
environment, including all
biological entities, as well as
mutually beneficial
Sustainability interactions among nature
explained and individuals,
organizations, and business
strategies.

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Core principles of sustainability

A long-term commitment to change the way we conduct our

business in order to balance the needs of current people &
those of future generations

Recognise that businesses are part of a complex system in

which environmental social & economic activities are
interdependent

Awareness & management of resource use & impacts.

Recognition of multiple forms of capital that contribute to the

quality of life and specific programs for the conservation and
enhancement of natural capital because of its special
characteristics.

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Core principles of sustainability

Together, this suggests ‘sustainability’ comprises:

Balancing the needs of

Concern for the triple-
people now, and those of
bottom-line (TBL)
future generations

Sustainability

Conservation and Reconsidering the way

enhancement of resources businesses operate

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Six additional concepts

Based on a meta-analysis of sustainability literature by Murdoch University’s Will
Varey, a range of elements have been identified that need to be considered:

1. A long-term or 2. Change and 3. The need for 4. Quality of life 5. Different forms 6. Limits to
future orientation transformation systems thinking and well-being of capital growth
• Focus on long- • Manage • Organisations • The level of • Not just • Resources are
term objectives change do not operate satisfaction financial not infinite,
and effectively so in a vacuum, that people capital, but therefore there
sustainability as to create they play an have with their natural capital, are limits to
competencies continual integral part in living human capital potential
needed for the transformation the overall circumstances. and social growth.
future. within social system capital.
organisations. within which we
live.

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Three
Dimensions of
Sustainability

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Thee Dimensions of Sustainability

Environmental Economic Social

• A recognition of how we Combination of: Three main elements:

use and depend upon the • Micro (financial measures 1.The provision of a safe
natural environment of business performance) and positive work
• Identification of important • Macro (issues of environment for
environmental issues consumption and employees, contractors
business should be aware globalisation) and suppliers.
of. 2.Responsibilities to
Two ways to think of customers
economic sustainability: 3.Corporate social
1.Internal (financial health responsibility (legal,
of the organisation) ethical, economic,
philanthropic)
2.External (adding value to
others)

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Sustainability for Business

Assessment and improvement of business strategies, economic sectors,
work practices, technologies, and lifestyles while maintaining the
natural environment

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Sustainability business
case value drivers

• Competitive advantage through

stakeholder engagement
• Improving risk management
• Fostering innovation
• Improving financial performance
• Building customer loyalty
• Attracting and engaging employees

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Positive Links
between
Environmental and
Economic
Performance

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Ethical Decisions
Affect
Sustainability as
a Component of
Social
Responsibility

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Global Environmental Issues

• Atmospheric
• Air pollution, acid rain, and global warming
• Water
• Water pollution and water quantity issues
• Land
• Land pollution, waste management, deforestation, urban sprawl, biodiversity, and
genetically modified (GM) organisms

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Environmental Legislations for Sustainability (USA)

• Environmental Protection Agency (EPA)

• Created to coordinate environmental agencies involved in:
• Conducting environmental research
• Providing assistance in fighting pollution
• Enforcing the nation’s environmental laws

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Environmental Legislations for Sustainability (USA)

• Clean Air Act (CAA)

• Endangered Species Act
• Toxic Substances Control Act (TSCA)
• Clean Water Act (CWA)
• Pollution Prevention Act
• Food Quality Protection Act
• Energy Policy Act

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Environmental Legislations for Sustainability

(Vietnam)

• Ministry of Natural Resources and Environment (MONRE)

• Developing legislation (for approval), regulations, and guidelines
• Formulating strategic plans
• Enforcing the nation’s environmental laws

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Environmental Legislations for Sustainability

(Vietnam)

• Commitment to achieving net-zero carbon emissions by 2050.

• Law on Environmental Protection (72/2020/QH14)
• Law on Land (45/2013/QH13)
• Law on Fisheries (18/2017/QH14)
• Law on Biodiversity (20/2008/QH12)
• Degree 117/2007/NĐ-CP on production and distribution of clean water
• Degree 08/2022/NĐ-CP provides further guidelines on the implementation of Law 72
• Fostering extended producer responsibility (EPR) policy

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Alternative Energy Sources

Geothermal
Wind power Solar power
power

Nuclear power Ethanol Hydropower

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Business Response
to Sustainability
Issues
• Triple-bottom line approach
• Considers social and
environmental performance
along with economic
performance
• Better environmental
performance reduces costs by:
• Improving risk management
and stakeholder
relationships
• Reducing the amount of
materials and energy used
• Reducing capital and labor
costs

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‘Bolt-on’ or ‘Embed’
Sustainability

• Embedded Sustainability is the

incorporation of environmental,
health, and social value into the core
business with no trade-off in price or
quality – in other words, with no
social or green premium
• While many more managers now
recognize social and environmental
performance as a business
opportunity, most continue to “bolt
it on” to existing strategy and
operations.

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‘Bolt-on’ or
‘Embed’
Sustainability

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Whatever the sustainability project or company-wide initiative, managers can benefit from assessing, and
acting on, its value creating potential at these multiple levels.

At the level of business context, it is about shaping

government regulations or industry standards that
favor the market leaders over the competition.

At the level of image and reputation, the interrogation

goes to the core identity of the company: to what
extent are social and ecological goals parts of its
mission or culture?
In terms of new market opportunities, the probe is
into business models: how can businesses find
profitable solutions to global problems? One such new
market/ business model example is that of meeting
the unmet needs of poor consumers in emerging
markets, as with Muhammed Yunus and his Grameen
Bank model of unsecured micro-credit

At the product differentiation level, the inquiry

concerns consumer expectations and how these are
changing to incorporate ever greater environmental,
health and social attributes

At the efficiency level, the query is into operational

excellence: how can embedded sustainability
contribute to greater savings along the lifecycle value
chain?
Mitigating risk is about avoiding value destruction by
managing potential costly liabilities

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Green Marketing and

Greenwashing
• Green marketing: Using stakeholder assessment to create
long-term relationships with customers while maintaining,
supporting, and enhancing the natural environment
• Greenwashing: Misleading a consumer into thinking that a
good or service is more environmentally friendly than it really
is
• Negatively relates to financial performance

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Strategic
Approaches to
Environmental
Issues

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Strategic Implementation of Environmental Responsibility

RRR
Stakeholder
(Reduce Reuse assessment
Recycle)

Strategic
Risk analysis Sustainability
Environmental Audit

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