This is “Introduction”, section 1.1 from the book Sustainable Business Cases (v. 1.0). For details on it (including licensing), click here.

For more information on the source of this book, or why it is available for free, please see the project's home page. You can browse or download additional books there. You may also download a PDF copy of this book (40 MB) or just this chapter (5 MB), suitable for printing or most e-readers, or a .zip file containing this book's HTML files (for use in a web browser offline).

Has this book helped you? Consider passing it on:
Creative Commons supports free culture from music to education. Their licenses helped make this book available to you.
DonorsChoose.org helps people like you help teachers fund their classroom projects, from art supplies to books to calculators.

1.1 Introduction

Learning Objectives

  1. Understand that businesses are increasingly acting with concern for the environment and society.
  2. Comprehend that business can play a positive role in helping to solve the world’s environmental and social problems.
  3. Appreciate that business interest in sustainability has been motivated by profit-making opportunities associated with sustainable business practices.
  4. Understand that this book focuses on sustainable business case studies in the United States.

Why would Google invest in wind farms that will not provide any energy for its high-energy-consuming data centers? Founded in 1998, Google runs the world’s most popular Internet search engine. It’s a position that has earned Google high profits and has given it huge influence over the online world. Then why would it take a risky investment of millions of dollars on an activity outside its core business? And why would the US government provide tax credits to Google and other private companies to invest in renewable energy? Can’t the private market and profit-making interests of private businesses ensure that an adequate supply of renewable energy is produced in the United States and globally?

All businesses, including Google, must focus on their economic performance and ensure they are profitable and provide an attractive return on investment for their owners and investors. Without this, businesses cannot continue as ongoing entities. For Google and other companies, their most important “bottom line” is their own economic bottom line, which is their profitability, or revenue, minus expenses.

Yet it is clear from Google’s investment in wind farms and the activities of private companies all around the globe that many of today’s business leaders look beyond their own annual economic bottom line and act with concern for how their business activities affect the environment and the very existence and sustainabilityIn the natural world, sustainability is the characteristic of a healthy, diverse ecosystem to endure over time. In terms of our society, sustainability is a state of human satisfaction and prosperity that exists from generation to generation brought on through the balanced interaction of society, environment, and economics. of the world’s physical and human resources and capabilities. This is what this book is about.

All companies must operate legally and achieve profitability to continue as ongoing entities. All companies also embed and reflect in their decision making and activities the values and priorities of their owners, key managers, employees, and other stakeholders. As will be highlighted in this book, some companies, such as BP prior to the Gulf oil spill in 2010, focus on annual profitability and investment returns to owners more than others. Other companies, including Google, give priority to other values (besides profit making) and take into consideration environmental and sustainability concerns along with concern for annual profits. And other firms, such as Green Mountain Coffee Roasters, Oakhurst Dairy, Simply Green, Timberland, Pax World, Seventh Generation, and Stonyfield Farms (as described in Chapter 7 "Case: Sustainable Business Entrepreneurship: Simply Green Biofuels" through Chapter 13 "Case: Strategic Mission–Driven Sustainable Business: Stonyfield Yogurt" in this textbook), more fully integrate sustainable business practices into their mission and corporate strategy and try to gain a competitive advantage by doing this.

This book describes what it means for a business to be sustainable and to engage in sustainable business practices and why a business would choose to act in a more sustainable manner. The book will be of interest to students who are interested in understanding the role of sustainable businesses in the economy and society, in addressing environmental concerns, and in working for or starting their own sustainable businesses.

The focus of the book is on the experience, opportunities, and challenges for sustainable businesses in the United States. While the book does not provide detailed international examples in its in-depth case chapters (Chapter 7 "Case: Sustainable Business Entrepreneurship: Simply Green Biofuels" through Chapter 13 "Case: Strategic Mission–Driven Sustainable Business: Stonyfield Yogurt"), it does discuss the opportunities and challenges of US-based sustainable businesses operating globally, specifically in Chapter 5 "Entrepreneurship, Innovation, and Sustainable Business" and Chapter 13 "Case: Strategic Mission–Driven Sustainable Business: Stonyfield Yogurt". The objective is to expose students in the fields of business, science, public policy, and others to the ideals, opportunities, and challenges of sustainable business practices with examples and lessons from a diverse group of companies in different industries.

Sidebar

What Is Sustainability?

Sustainability is meeting “the needs of the present without compromising the ability of future generations to meet their own needs.” This is a commonly referenced definition, developed by the Norwegian prime minister Gro Harlem Brundtland for the 1987 report “Our Common Future,” produced by the World Commission on Environment and Development under the direction of the United Nations.

Sidebar

What Does It Mean to Be Green and Is That the Same as Sustainable?

And what does “green” mean and how does it relate to sustainability? Green is a term widely used to describe buildings, products (of all types, including cars, food, computers, etc.), and services designed, manufactured, or constructed with minimal negative impact on the environment and with an emphasis on conservation of resources, energy efficiency, and product safety. Being “green” can help to preserve and sustain society’s resources.

Key Takeaways

  • Businesses are increasingly engaging in activities with concern for the environment and society.
  • Businesses are engaging in these activities because they recognize they can play a positive role in helping to solve the world’s environmental and social problems.
  • Businesses are also interested in sustainability because of market and profit-making opportunities associated with sustainable business practices.
  • This book intends to explore the opportunities and challenges for sustainable business in the United States primarily through case studies.

Exercises

  1. Answer the following questions:

    1. Do you think that Google would have invested in the two North Dakota wind energy projects if they did not receive tax credits (a government incentive that reduces the federal taxes that they owe)? Why or why not?
    2. Besides tax credits, what are some of the other benefits that Google could obtain by investing in the wind energy projects?
    3. Based on this article, do you think that it is wise for Google to continue investing in potential future renewable energy projects given that their core successful business model is based on web searches and not providing energy?
  2. Search on the web and find three other examples of companies investing in renewable energy projects, even though those companies’ core business models do not involve energy production. Describe the business, their core business model, and the type of project they invested in.