Fundamentals of Sustainable Business. Matthew Tueth

diverse collection of eateries offers more appealing food, service, and total dining experience when compared to the chain establishments. Another option is to browse the local farmers markets and food cooperatives that are popping up all over the U.S. Similar opportunities to support local businesses exist in many communities for entertainment, business services, grocery, real estate, and retail clothing. Remember, too, that a marketplace with many small businesses encourages fair competition, innovation, and the best value for the consumer’s dollars.

      City, county, and even state governments have the opportunity to enact policies that support local and regional businesses and discourage the loss of local jobs and wealth. Unfortunately, many of our current economic policymakers still do not recognize the long-term value provided by a locally owned and anchored regional business sector. Often foreign-owned companies are seen by the government as the brass ring to snare, and officials use huge tax breaks and public infrastructure improvements to try and lure these international facilities while upping the ante for other U.S. cities hoping to attract overseas businesses. However, the short-term political and social benefits of a new foreign facility are more than negated by the lack of tax revenues for the local school systems and the eventual loss of jobs from the corporation pulling up stakes when they find another location that offers them more favorable tax, wage, and infrastructure concessions. This scenario, with its not-so-happy ending, has played out countless times in recent decades in the U.S., and still, headline-chasing politicians continue to concentrate limited economic development dollars on foreign industry rather than on local community efforts. This dogchasing-its-tail strategy is not part of the sustainable business movement. The role of the government in advancing a transition to healthy and stable local economies is extensively discussed in Chapter 6.

1.3Early Visionaries and the Resistance to Change

      A number of astute authors as early as the mid-20th century, including Aldo Leopold and Rachel Carson, published works that identify parts of the unsettling trend previously described and suggest systemic changes in our approach toward business, community, and the environment. Other “outside-the-box” thinkers such as California economist Garret Hardin, in addition to acknowledging portions of the aforementioned problems, expressed serious pessimism about the possibility for significantly changing our course.³ In 1993, author Paul Hawken published the strikingly influential book The Ecology of Commerce in which he not only identifies industry as culpable in our dire state of affairs but also, more importantly, recognizes the unique opportunity and power of business to lead a meaningful long-term recovery rather than governments or non-profit organizations. Hawken deftly points out that our problems are entrenched throughout commerce and that a consequential solution involves a fundamental redesign by business itself. Later, we will also discuss the original contributions to this movement from other visionaries such as Janine Benyus, Amory and Hunter Lovins, Sandra Steingraber, Michael Shuman, William McDonough, and Michael Braungart.

      The unconventional nature of the strategies covered in these chapters require considerable thought and time to process and integrate into our paradigm. On a personal level, many find the requisite professional self-examination particularly challenging in a number of ways. First, those who are professionally and personally successful are not always inclined to seriously reconsider basic components of their core belief system. The necessary open-minded self-scrutinizing re-examination is difficult and often unpleasant, and so many of us avoid it. Second, after acquiring a basic understanding of the natural world and the adverse effects of business as usual upon it and ourselves, we often have difficulty accepting complicity of our own professional activities. We may discover an internal dilemma in admitting that we have spent a good portion of our lives indirectly weakening future prospects for the natural world and our grandchildren.

      The final requirement of a paradigm shift involves one’s own personal time and effort, a most precious commodity. Most Americans lead quite busy lives integrating family, job, friends, and personal interests. Simply finding the time to read this book may be difficult for you, let alone finding the time to consider the far-reaching ramifications of its tenets and to apply them in your life. However, we do attend to the things that are most important to us, and you may find that the most onerous option will be to not follow your intuition and heart down this unsettled road of change. At any rate, we will fix only what we know to be broken, so let’s go a bit deeper into humankind’s situation.

1.4Do Current Free-Market Mechanisms Help?

      Today environmental scientists around the world constantly gather data and monitor various types of pollution, habitat degradation, and natural resource exploitation. Considering the enormity of our global industrial activities and the corresponding negative effects upon life on Earth, it is fairly easy to understand how business is often viewed by the investigator as the incorrigible ecological villain. The 1984 Union Carbide chemical plant disaster in Bhopal, India; the 1986 meltdown and explosions of the nuclear reactor in Chernobyl, Ukraine; the 1989 Exxon Valdez oil tanker calamity in Prince William Sound of southeastern Alaska; and the 2011 Fukushima Daiichi nuclear power disaster in Japan are four well-publicized examples of catastrophic industrial debacles.

      For decades, environmentalists and social reformers have pushed for a strong set of state and federal environmental regulations that force businesses to reduce the contamination of air, water, and soils and to limit the exploitation of limited natural resources. As discussed earlier, this approach simply has not worked well through time for the environment or for world citizens. Even with billions of dollars spent by government and business to mitigate these problems through a labyrinth of complex environmental regulations, each year the U.S. alone still releases millions of pounds of persistent toxins and generates thousands of tons of lethal high-level nuclear waste, some of which will require secure storage for tens of thousands of years.⁴ A closer look also reveals that many exploitive industrial practices continue, such as the indiscriminate harvest of tropical rain forest timber, that significantly weaken a variety of natural systems upon which humans and all other life depend.

      In theory, both U.S. businesses and consumers rely on our modified market-based economic system to appropriately adjust prices and demand for natural resources. Commonly, when supplies of a particular resource dwindle and the price for this resource subsequently rises, we rely on technology advancements to improve our utilization efficiency, to locate a new source for that resource, or to discover a suitable substitute for that resource, all of which cause prices to fall back to lower levels. Unfortunately, a variety of free-market system defects exist in this scenario: people other than the buyer routinely pay part of the cost of goods or services because of the pervasive externalizing effects of pollution (electric bill), certain essential commodities have no substitutes (oxygen), most essential services have no substitutes (favorable climate), legal monopolies do exist (utility companies), government does regulate certain types of commerce (banking industry), government provides billions of dollars in subsidies for certain types of resource extraction (metals and crude oil), and the value of natural capital (biodiversity) and natural services (pollination of crops) is largely unaccounted for and ignored by the market.

      To further hamstring the effectiveness of our economic system, we monitor domestic financial activities using misleading indicators that do not scrutinize the long-term effects of industry on both human and natural communities. For example, our common economic indicators such as gross domestic product assume a dollar spent on our prison system provides the same value as a dollar spent on our educational system, or a dollar spent on medical treatment of an ailment provides the same value as a dollar used for preventive health care. Our gross undervaluing of the natural world, the market failures of capitalism, and our inability to recognize and monitor useful economic information have put us in a situation where we covertly pass on harmful economic, environmental, and social consequences to people distant to us in both location and time, which is nothing short of poignant intergenerational tyranny. Ironically at the same time, we routinely allow shortsighted and relatively inconsequential pop cultural issues to dominate mainstream media and public conversation while the issues of enormous repercussions described above remain on the sidelines. Consider a commercial plane full of people at 25,000 feet conversing about which drinks to order while the fuel tanks are