Environmental enterprise

Natural resource scarcity or/and abundance are drivers of globalization, as they incite supply and demand forces in global markets.[2]

For the past 50 years we have amassed unprecedented financial wealth, but have also chronically under-priced risk in terms of our natural resource base (our endowment of minerals, forests, fish, water and climate).[2] We have financed our extraordinary growth in aggregate living standards while systematically under-pricing the goods and services we derive from our planet's natural resources, the negative externalities we create by polluting them and the future risks we face from their cumulative depletion and degradation.[2] The phenomenal economic growth we have enjoyed over the past 50 years has seen our world's built environment and transport networks expand in size and complexity at an unprecedented rate.[3] We have developed a vastly more interconnected global human ecosystem to provide us with food, fuel, water, homes and transportation than has ever been.[2] Sustainability can be achieved because the companies adapt sustainable production to improve their image. Being environmentally friendly is good for product branding. Meanwhile, as social issues come up, some companies focus on the environmental issues in order to create the positive image of the company. As environmental social concerns increase, some companies start to supply environmentally friendly products and distribution systems. The meanings of the systems can be explained either by the viewpoints of the company's management or the idea that an environmentally friendly management guidelines will give a positive image of the company and its goods. In other words, these thoughts are based on economic and ethical reasons.[4] The Kyoto Protocol can be an example: It was intended to solve global problems of climate change and global warming; however, some companies had already put reducing emissions and getting better energy efficiency into practice, which is helpful to create a positive public image.[5]

In economics, an externality is the cost or benefit that affects a party who did not choose to incur that cost or benefit. The cost of the environment is usually termed as the external cost of an enterprise. Air pollution from burning fossil fuels causes damages to crops, (historic) buildings and public health. "Social cost − private cost = External cost". The ideal situation of environmental enterprise is to cut the negative external cost. [8]

Social cost in economics may be distinguished from "private cost". Economic theorists model individual decision-making as measurement of costs and benefits. Social cost is also considered to be the private cost plus externalities.

For example, the manufacturing cost of a car (i.e., the costs of buying inputs, land tax rates for the car plant, overhead costs of running the plant and labor costs) reflects the private cost for the manufacturer (in some ways, normal profit can also be seen as a cost of production; see, e.g., Ison and Wall, 2007, p. 181). The polluted waters or polluted air also created as part of the process of producing the car is an external cost borne by those who are affected by the pollution or who value unpolluted air or water. Because the manufacturer does not pay for this external cost (the cost of emitting undesirable waste into the commons), and does not include this cost in the price of the car (a Kaldor-Hicks compensation), they are said to be external to the market pricing mechanism. The air pollution from driving the car is also an externality produced by the car user in the process of using his good. The driver does not compensate for the environmental damage caused by using the car.[9]

"We support organic farmers, growers and the environment through our commitment to sustainable agriculture and by expanding the market for organic products. We work with ranchers and producers to develop hormone and antibiotic-free alternatives for our customers to buy. We advocate fewer and safer pesticides in non-organic foods."

"We respect our environment and recycle, reuse, and reduce our waste wherever and whenever we can. We seek to balance our needs with the needs of the rest of the planet through the following actions:

• Supporting sustainable agriculture. We are committed to greater production of organically and bio-dynamically grown foods in order to reduce pesticide use and promote soil conservation.
• Reducing waste and consumption of non-renewable resources. We promote and participate in recycling programs in our communities. We are committed to reusable packaging, reduced packaging, and water and energy conservation.
• Encouraging environmentally sound cleaning and store maintenance programs.
• Promoting the purchase of bulk food and other products utilizing reduced or reusable packaging, as well as encouraging shoppers to reduce waste through nickel per bag rebate program."