Contemporary Issues in Management

Contemporary Issues in Management

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nEnvironmental Sustainability

nIntroduction

nIn the current century, corporations experience unanticipated roles in satisfying the environmental needs in the world as well as for their customers. Many organizations are adopting sustainable business practices to facilitate competitive advantage and long-term viability. Therefore, firms management need to oversee the incorporation of sustainable business activities into the framework of their firms. Wood (1991) suggests that corporate social performance is an important factor in organizational management because it ensures that firms has a positive effect on consumers, employees and societies (Wood 1991, p,5). The organizations management develops options, analysis and decisions that offer strategies that mitigate the environmental risks on a long-term basis. Corporate sustainability is a business strategy that facilitates long-term employee and consumers value. Additionally, they form approaches that cater for natural environment and protect it (Barr, Gilg & Shaw 2011). In this regard, the company initiates corporate sustainability programs. Many organizations are increasingly utilizing the crucial role of sustainability for a better future of their businesses. Moreover, many companies are establishing corporate sustainability in order to gain from high shareholders value. Wood (1991), notes that shareholder engagement helps the business to know and communicate with government, society and civilians. In addition, it helps to improve the capacity of the support team and they are able to overcome challenges (Wood 1991). The integration of environmental sustainability programs in the firms mission and vision helps to manage risks, increase competitive advantage and promote long-term development. In addition, it assist in developing profitability and increasing cost savings (Albino, Alice & Dangelico 2009, p.2). In this respect, corporate sustainability practices are growing across the globe in companies.

nThe success of corporate environmental sustainability is embedded in various factors within an organization. According to Wood (1991), corporate sustainability is useful in are with poor governance, poor accountability mechanisms and limited rule of law (Wood 1991). First, the company should understand the success or failure of the programs and practices lie on the hands of the entire organization but not on a single department. In addition, in decision-making, a firm needs to integrate sustainability objectives and targets, which are necessary for departments or individuals subsidiaries (Laurent, Olsen, & Hauschild 2012, p.3). The company concentrates on efficient and extensive sustainability trainings (eds Ginley & Cahen 2011, p.2). Moreover, organizations need to focus on establishing better reporting and monitoring sustainability performance. In a firm, the critical drivers of corporate sustainability are ability to comply with regulatory requirements as well as need to manage risk likely to affect the reputation of the brand or company. These sustainability efforts are to reinforce their marketing and sales teams to gain easy access to new marketing segments (Barr, Gilg & Shaw 2011, p.5). Besides, it helps in supporting pricing strategies and enhances firms customer value. Corporate sustainability also helps to increase the bottom line in a business.

nImplementing Corporate Environmental Sustainability in Woodbine Entertainment Group

nWoodbine Entertainment Group in Canada started a sustainability practices and programs over the last decade. The firms deal with horseracing activities. Environmental sustainability programs involved community initiatives efforts. The company initially began with charitable activities in the community and later expanded to include sustainability activities that initiated substantial efficiency gains (Fries 2010 p.9). Most notably, the success of the program was dependent on community investment and corporate social responsibility activities that lead to environmental protection.

nThe activities of the business in the community were not aimed to gain profits. Instead, the company contributed to charitable donations. These programs helped the firm to increase the federal contribution (McKINNON 2010, p.5). In Canada, the firm was the only entertainment company that initiated non-profit programs in the country. The national program promoted corporate participation and public giving, volunteerism and support in the society. It launched Imagine Canada membership initiatives where the communities donated 1 percent of their pre-tax to charitable organizations (Fries 2010 p.8). In every year, Woodbine Entertainment Group increased the funding by donating more than 3 percent of its net revenues to charities in the community. The company spent more than USD 12 million in environmental programs in order to replace old and dirty horseracing tracks with modern synthetic tracks (Barr, Gilg & Shaw 2011, p.8). Moreover, the program was intended to reinforce the jockeys and horses safety.

nNevertheless, the company noticed that the new tracks did not require watering or tractors grooming. The firm used similar decision-making process used in community investment projects to determine the reductions in water usage and carbon emissions. Woodbine Entertainment Groups formed a time of sustainability officers, which included the Board of Directors, which were responsible for corporate sustainability (Albino, Alice & Dangelico 2009, p.3). In addition, they developed environmental officers to oversee the activities of the business in specific environmental issues. Secondly, the company created a “green action team” that comprised middle managers and front-line staff. These managers cooperated to identify the potential savings that can be developed through environmental projects. For instance, the company initiated projects such as waste reductions, lighting using solar-power and lights from government agencies and electricity providers (Fries 2010 p.12). The initiative was designed to generate an energy efficient system within the facility.

nThirdly, the organization developed program to involve the chief financial officers in environmental initiatives. These CFOs headed the Green Steering Committees that established the green action groups. In addition, the teams comprised of corporate social responsibility officers, Directors of Energy, Environmental Officers, directors of purchasing and Senior VP operations. Besides, the team created a business case that was delivered to the CFO for evaluation (Fries 2010, p.11). The director of property development was the environmental officer and was responsible for delivering reports to the chief financial officer. Wood (1991) argues that corporate social responsibility improves the corporate image and many customers increase their confidence in the firm (Wood 1991).

nFourthly, the organization determined the customers and employee views in order to facilitate effectiveness and value of its sustainability practices. In this respect, it used engagement surveys whose results suggested ways of improving environmental sustainability through formulating employees engagement as its strongest driver (Moldan, Janoušková & Hák 2012, p.10). Subsequently, more than 85 percent of customers using the racetracks showed that the firms environmental sustainability efforts influence their choice of doing business with Woodbine Entertainment Group positively.

nThe success story of Woodbine is based on sustainability practices and programs founded on positive community investment enterprise. Proper implementation of one feature of environmental sustainability capacity helps to register success in other sustainability programs, which then contribute to other benefits. Woodbine Entrainment company improved its racetracks aiming to support the horses and jockeys safety. In addition, it intended to reduce carbon emission and water usage (Albino, Alice & Dangelico 2009, p.2). Consequently, these efforts now act as the firms best practices in the entertainment industry across North America.

nIn addition, the company is now highly rated in the country. Furthermore, it has gained a good reputation within the regulatory agencies because of environmental sustainability efforts they are committed to undertaking. Therefore, success in environmental sustainability programs produces more achievements in firms reputation, competitive advantage ad increases customers confidence (Fries 2010, p.10). In addition, the firms investors, customers and employees are happier and more committed to the firm.

nWhy Organizations fails to meet Environmental Sustainability

nThere are several factors that contribute to a business failure to achieve goals for environmental and sustainability. First, a firm may be confused because there are many factors that determine the sustainability. For instance, a company may set goals but fails to establish metrics of measuring them (Barr, Gilg & Shaw 2011, p.18). In addition, environmental sustainability programs and practices are hard to measure since most of them usual influence society at a macro level and their implications to the firms are not evident. In addition, their effects are not experienced after a short period and are dependent on who execute them (Albino, Alice & Dangelico 2009, p.8). Many companies rely on of comprehensive tools of analysis such as life-cycle assessment, ecological footprint and Global reporting initiatives. Most notably, different tools of analysis lead to more challenges than solutions.

nThe company fails to identify which parameters of measurement are necessary for their needs. Different metrics has various uses, which are not applicable in all areas. For instance, some are relevant to manufacturing sectors while others focus on certain problems such as carbon emission. Besides, some metrics concentrates on groups while others focus on their products. Therefore, there are various certifications, standards and metrics to measure environmental sustainability (Barr, Gilg & Shaw 2011, p.10). Much organization lacks guidance to determine their efforts, recognize areas that require improvement and signal their commitment to sustainability.

nMany organizations fail to attain corporate environmental sustainability because of inadequate government policies. Many government policies lack incentives to undertake sustainability and are not linked to it. There are different kinds of tools that the government uses such as regulations and taxes as well as market. These tools can either discourage or promote companies towards environmental sustainability (Dangelico & Pujari 2010, p.4). Many governments applies these tools in fractional fashion and are utilized inefficiently. Moreover, the authorities poorly measure sustainability programs. Furthermore, government policies fail to lead companies to long–term goals and innovative products and practices that are connected to their goals (Orlitzky, Siegel & Waldman 2011, p.7).

nMany regimes do not initiate cooperative consultations and development of strategies involving all stakeholders and businesses. Therefore, corporates fail to work with governments in a meaningful and collaborative manner (Albino, Alice & Dangelico 2009, p.11). Furthermore, businesses fail to develop bridges between their business and governments that facilitate sharing of knowledge and making future business sustainability.

nThirdly, majority of companies do not have strategies of motivating their employees in order to launch sustainability initiatives. Wood (1991) suggest that corporate sustainability improves the employees commitment in their work that helps to increase work performance (Wood 1991). Studies reveal that many employees forego huge incomes in order to work in environmentally sustainable companies. Therefore, many companies lose their best employees because they lack motivation to initiate sustainability programs (Laurent, Olsen, and Hauschild, 2012, p.4). The management should begin mechanisms that allow for sustainability values and actions. Additionally, companies establish short-term goals at the expense of long-term goals that separate their commitment to only keeping with their peers (Albino, Alice & Dangelico 2009, p.10). In this regard, the commitments of the companies should be in line with sustained employees interests.

nSome sustainability initiatives do not fit business initiatives of the firm. Many business managers do not value the need of sustainability because they affect the financial goals of the company. Sustainability goals are often designed for long-term and intangible benefits as compared to many projects that have short-term outcomes on the bottom line. Consequently, managers determine the short-term benefits at the expense of long-term environmental sustainability benefits (Barr, Gilg & Shaw 2011, p.11). The executives may use intangibles to defend corporate environmental investments. The majority of managers choose projects that have returns on sustainability. In addition, they want projects that can easily justify the long-term and short-term investments. Therefore, sustainability needs to be acceptable as legitimate and valuable.

nFourthly, in various sectors, there are no ordinary rules of developing sustainability and customers demand services and products that are environmentally responsible. However, the process of recognizing sustainable businesses is not easy task, and the methods of comparing items are not apparent. Sourcing sustainable decisions require sector-specific practices and knowledge or information that is not readily accessible (Barr, Gilg & Shaw 2011, p.19). Choosing a full range of a sustainable sourcing offer a firm with targets for guidance and organizing supply chain. It also creates a chance for real companies to develop their fortunes. Sourcing sustainability is an important practice that helps in mitigating and managing risks. Furthermore, it helps the company to align societal needs with business goals (Fries 2010, p.10). However, majority of businesses fails to manage their supply chains sustainably.

nFifth, some organizations do not have mechanisms to distinguish between crucial opportunities and threats in the future. Businesses face various challenges such as climate change, financial crises and health pandemics. It is not easy to analysis the problems that need attention. Indeed, prioritizing them is often a challenge (Dangelico & Pujari 2010, p.19). Companies require proper guidance on methods of analyzing an issue for strategic planning and disclosure purposes. Firms need information in advance in order to focus their attention and understanding of risks and opportunities that can assist the organization in the future. Managers then prioritize these issues according to internal strategies (Albino, Alice & Dangelico 2009, p.10). Finally, the management communicates the issues to stakeholders.

nWoods notes that corporate social responsibility is a strategy for organizations to take advantage of the community and at the same time benefit themselves. In this respect, organizations should embrace sustainability because it will help in innovation that increases community and companies capacity (Orlitzky, Siegel & Waldman 2011, p.11). For instance, Woodbine Entertainment Group was able to launch an environmental sustainable program in the racetracks that use less water. Without sustainability efforts, the firms development and research practices would probably not have succeeded. Secondly, the organization takes advantage of cost savings. Sustainability helps a company to cut costs, for instance, in Woodbine Entertainment Groups; it uses less energy that helps to save cost and increases savings. After developing the program, the firm was able to reduce costs that ultimately increase savings (Albino, Alice & Dangelico 2009, p.18). Moreover, through sustainability, Woodbine Entertainment Group in Canada gained from brand differentiation. It was able to secure a place in the society and incorporate corporate value into the business model (Fries 2010, p.10). Through successful sustainability, Woodbine Entertainment Group acquired good reputation that helps to compete with other competitors in the market. There are greater corporate benefits following environmental sustainability efforts. According to Wood (1991), when a firm has a good reputation, many consumers are willing to do business with it (Wood 1991, p.8).

nSustainability efforts enable a firm to acquire long-term benefits rather than short-term advantages. According to Wood, sustainability is an initiative that focuses at the long-term interest of the firm and ensures that the goals are achieved (Wood 1991, p.9). In this regard, the corporation realizes that a decision that is made today is likely to affect the firms performance in the next decades.

nWoodbine Entertainment Group used sustainability to facilitate customers participation. Through this initiative, it has established itself as a leader on environment issues in the entertainment industry. In addition, its efforts help to raise awareness about environment and the products decisions customers should choose. Therefore, sustainability in a firm promotes customers engagement (Barr, Gilg & Shaw 2011, p.25). For instance, it is the best avenue to speak to their customers and to utilize business-to-society communication.

nAs Wood (1991) argues, sustainability helps in employee engagement. The underlying reason behind this initiative is the fact that if employees fail to understand the firms goals, it may not accomplish them (Wood 1991, p.3). Companies such as Woodbine in Canada created Sustainability Working Team that develops sustainability strategies (Albino, Alice & Dangelico 2009, p.19). The team motivated employees in community service depending on the organizations sustainability priorities.

nConclusion

nBusiness frequently struggle to establish sustainability measures because most of them believe that it is misappropriating funds. Nevertheless, as the public demands increases, firm have no other alternative other that combine sound business practices and sustainability (McKINNON 2010, p.9). Investing in environmentally sustainable business means the company will sell more products since it is more reputable and respectable. In addition, environmental sustainability produces fewer risks for business and opens itself for the future liability (Dangelico & Pujari 2010, p.10). For instance, Woodbine Entertainment industry initiated an environmentally sustainable program in the community that reduced water use and carbon dioxide emission (Moldan, Janoušková & Hák 2012, p.11). The program also improves the safety of its employees. Therefore, it is high time organization initiate environmental sustainability since they enable important aspects in a firm.

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nReferences

nAlbino, V Alice, A & Dangelico, RM 2009, Environmental strategies and green product development: an overview on sustainability‐driven companies Business Strategy and the Environment, 18(2), 83-96.

nBarr, S Gilg, A & Shaw, G 2011, ‘Helping People Make Better Choices, Exploring the behavior change agenda for environmental sustainability Applied Geography, 31(2), 712-720.

nDangelico, RM & Pujari, D 2010, Mainstreaming green product innovation: why and how companies integrate environmental sustainability Journal of Business Ethics, 95(3), 471-486.

nFries, J 2010, Evolution of corporate sustainability practices Perspectives from the UK, US and Canada, AICPA, CICA and CIMA research study.

nGinley, D.S & Cahen, D (Eds.) 2011, Fundamentals of materials for energy and environmental sustainability, Cambridge university press.

nLaurent, A Olsen, SI & Hauschild, MZ 2012, Limitations of carbon footprint as indicator of environmental sustainability Environmental science & technology, 46(7), 4100-4108.

nMcKINNON, A 2010, Environmental sustainability, Green logistics, Improving the environmental sustainability of logistics

nMoldan, B Janoušková, S & Hák, T 2012, “How to understand and measure environmental sustainability”, Indicators and targets Ecological Indicators, 17, 4-13.

nOrlitzky, M Siegel, DS & Waldman, DA 2011, “Strategic corporate social responsibility and environmental sustainability”, Business & Society, 50(1), 6-27.

nWood, DJ 1991, “Corporate social performance revisited”, Academy of management review, 16(4), 691-718.