Sustainability (AQA GCSE Business)

An Introduction to Sustainability

• Sustainability means meeting our current needs without compromising the ability of future generations to meet their own needs

• Businesses can contribute to sustainability by changing their operations in a variety of ways

Diagram: Improving Sustainability

Businesses can contribute to sustainability in a range of ways

Using renewables in production

• More than 99% of the wood used in IKEA's furniture products is either sourced from sustainable sources or recycled

Reducing water use in industrial processes

• Introduced in 2011, Levi's Water<Less programme reduces the use of water in the manufacture of the company's denim products, so far saving over 4.2 billion litres of water in shortage areas

Using green transportation, such as electric vans

• Almost 40% of delivery company Evri’s London vehicles are zero-emission and the company operates e-cargo bikes across four UK cities

Avoiding the use of toxic substances

• Home accessories brand Parachute uses organically-grown textiles, with no harmful chemicals used at any stage of production

Using renewable energy, such as solar

• Unilever uses 100% renewable electricity across all its factories, offices, R&D facilities, data centres, warehouses and distribution centres. They also generate their own solar power at production facilities in 23 countries.

Implementing recycling

• Revive Innovations Ltd recycles compact discs, turning them into beautiful items of furniture and home accessories

Global Warming

• Global warming is set to cause permanent changes to the world's climate and will have long-lasting impacts on businesses

• The main impacts of global warming include:

  • Changes in weather patterns, including more extremes in temperature

  • Drought and increased instances of water shortages

  • Rising sea levels as a result of melting polar ice caps

• For businesses, global warning may have some serious implications

  • Businesses in high-risk areas face more frequent disruption due to floods or intense heat conditions

    • Insurance premiums may rise, increasing business costs

  • Some businesses may relocate to less exposed regions or take advantage of changed climates in previously unsuitable areas

  • Sectors such as tourism may experience significant change

    • Travel patterns are likely to change as some previously unpopular regions become more attractive to tourism and some become inaccessible

    • Consumer desire to reduce their carbon footprint is likely to increase demand for greener transportation and accommodation

    • Long-haul destinations may attract fewer visitors as consumers become more aware of the impact of emissions from air travel

The use of Scarce Resources

Many of the earth’s natural resources are finite, which means that they will eventually run out

Examples of Scarce Resources

• In response to scarcity of resources, businesses can pursue a range of strategies

  • Adopt circular economy principles

    • Resources are kept in use for as long as possible, and waste is minimised, by reusing, repairing, refurbishing and recycling materials and products

  • Improve efficiency measures

    • E.g. installing energy-efficient equipment, redesigning production processes, and conserving water

  • Invest in sustainable alternatives

    • E.g. Using renewable energy sources, such as solar or wind power and switching to more sustainable raw materials such as organic cotton

Trade-offs between Sustainability & Profits

• Adopting sustainable practices can involve significant upfront costs and operational expenses

  • Sustainable raw materials and components may be more expensive

  • Adapting production processes and machinery may require significant capital investment

• These additional costs can potentially reduce profitability, at least in the short term

• On the other hand, prioritising short-term profits over sustainability can lead to long-term consequences, such as resource depletion and environmental damage

  • This can create legal issues or cause damage to a businesses reputation

• These factors undermine a company's long-term viability and profitability