Content area
Full Text
Executive Overview
Corporations in North America, Europe, Japan, and in most newly industrializing nations are embracing environmental protection as part of their international competitive strategies. For many firms, the shift to proactive environmental management is driven by pressures from governments, customers, employees, and competitors. Both consumers and investors are beginning to see more clearly the relationship between business performance and environmental quality. The trend toward proactive environmental management is being accelerated by public pressures on governments almost everywhere to assure a cleaner environment. Government regulations have become more stringent, legal liabilities for environmental damage have become more burdensome, and customers have become more demanding. But more importantly, there is growing evidence that firms that adopt proactive environmental management strategies become more efficient and competitive. In many countries, the public has become more vocal in demanding responsible environmental performance as incomes rise and education spreads. Calls for responsible corporate behavior are coming from investors, insurers, environmental interest groups, financial institutions, and international trading partners.
A New Industrial Revolution?
The Swiss industrialist and former chairman of the Business Group for Sustainable Development, Stephen Schmidheiny, predicted in 1990 that changes in environmental thinking would bring ". . . a new industrial revolution. It is the most forceful trend in my lifetime. It will reshape business because it will redefine the rules of the game."1 The rapid changes occurring in corporate environmental management during the 1990s may validate predictions by environmentally conscious business leaders about a new industrial revolution in the 21st century. In the United States and most western countries, protection of the environment is no longer the contentious tissue it was two decades ago. Environmental sustainability-the need to protect the environment and conserve natural resources-is now a value embraced by the most competitive and successful multinational companies.2 The McKinsey Corporation's survey of more than 400 senior executives of companies around the world found that 92 percent agreed with Sony Corporation president Akio Morita's assertion that the environmental challenge will be one of the central issues of the 21st century.3 Nearly all executives responding to McKinsey's survey acknowledged their corporation's responsibility to control pollution, and about 83 percent agreed that corporations have an environmental responsibility for their products even after they leave the plant. A primary concern...