ENVIRONMENTAL (ETHICAL, LEGAL AND ENVIRONMENTAL FACTORS)

What are environmental factors in business?

Environmental factors are external influences relating to how business activity affects the natural environment, including pollution, climate change, waste, and resource use.

What are environmental costs of business activity?

Environmental costs are negative externalities caused by businesses that damage the environment and society.

What is air pollution?

Air pollution is the release of harmful gases and particles (e.g. CO_2, nitrogen oxides) from factories, vehicles, and power generation.

How does business activity cause air pollution?

Businesses cause air pollution through:

• Manufacturing processes
• Transport and logistics
• Burning fossil fuels for energy

What is water pollution?

Water pollution occurs when chemicals, waste, or untreated sewage are released into rivers, lakes, or oceans.

How do businesses contribute to water pollution?

Businesses may:

• Discharge industrial waste
• Use agricultural chemicals
• Spill oil or toxic substances

What is noise pollution?

Noise pollution is excessive or harmful noise caused by business activity.

How does business activity cause noise pollution?

Noise pollution is caused by:

• Construction
• Airports
• Factories
• Heavy transport

What is climate change?

Climate change refers to long-term changes in global temperatures caused largely by greenhouse gas emissions.

How do businesses contribute to climate change?

Businesses contribute through:

• Carbon emissions
• Energy consumption
• Deforestation
• Non-renewable resource use

What is congestion as an environmental cost?

Congestion occurs when business-related transport increases traffic levels, leading to pollution and reduced quality of life.

How do businesses contribute to congestion?

Businesses contribute through:

• Delivery vehicles
• Commuting employees
• Logistics and distribution networks

What is destruction of the environment?

This refers to permanent damage to ecosystems, habitats, and biodiversity.

How does business activity destroy the environment?

Businesses may:

• Deforest land
• Extract raw materials
• Build on natural habitats

What is waste disposal?

Waste disposal is the removal or management of unwanted materials produced by business activity.

Why is waste disposal an environmental cost?

Improper waste disposal causes:

• Land pollution
• Toxic leaks
• Increased landfill use

How can governments control environmental costs?

Governments can use:

• Legislation
• Taxation
• Subsidies
• Regulation and fines

What is environmental legislation?

Environmental legislation includes laws that limit pollution and protect the environment.

Give examples of environmental legislation.

Examples include:

• Emission limits
• Waste disposal regulations
• Bans on harmful chemicals

How does taxation control environmental damage?

Governments can impose:

• Carbon taxes
• Landfill taxes
  to discourage environmentally harmful behaviour.

How do subsidies encourage environmentally friendly behaviour?

Subsidies reduce the cost of:

• Renewable energy
• Energy-efficient technology
  making green investment more attractive.

What role do pressure groups play?

Pressure groups campaign and raise awareness about environmental issues and influence government and business behaviour.

How do pressure groups influence businesses?

They use:

• Media campaigns
• Boycotts
• Protests
  to damage reputation and force change.

How does education reduce environmental costs?

Education increases awareness among:

• Consumers
• Employees
• Managers
  leading to more responsible decisions.

How can businesses reduce their environmental impact?

Businesses can:

• Reduce emissions
• Use renewable energy
• Minimise waste
• Improve energy efficiency

What is recycling in business?

Recycling involves reusing materials to reduce waste and conserve resources.

How can businesses reduce waste?

By:

• Redesigning packaging
• Using lean production
• Recycling by-products

What is ethical sourcing?

Ethical sourcing involves obtaining materials in a way that minimises environmental harm and respects sustainability.

Why do businesses adopt sustainable practices?

To:

• Improve reputation
• Meet legal requirements
• Reduce long-term costs
• Appeal to ethical consumers

What is corporate social responsibility (CSR)?

CSR is when businesses voluntarily consider social and environmental impacts in decision-making.

What are the negative impacts of business activity on the environment?

• Pollution
• Climate change
• Habitat destruction
• Resource depletion

What are the positive impacts businesses can have?

Businesses can:

• Invest in green technology
• Develop sustainable products
• Raise environmental awareness

Why does the impact vary between businesses?

It depends on:

• Industry type
• Business size
• Government regulation
• Stakeholder pressure

How does business activity create external costs?

Environmental damage often affects society rather than the business, creating negative externalities.

What is a balanced evaluation of business impact on the environment?

While business activity causes significant damage, regulation and innovation allow firms to reduce harm and improve sustainability.

What are environmentally friendly policies?

Policies aimed at reducing environmental impact, such as reducing emissions or waste.

What are the benefits of environmentally friendly policies for businesses?

• Improved brand image
• Increased customer loyalty
• Long-term cost savings
• Compliance with laws

What are the costs of implementing environmentally friendly policies?

• High setup costs
• Investment in new technology
• Training employees

How do environmental policies affect competitiveness?

They may:

• Increase costs in the short term
• Improve competitiveness long term through efficiency and reputation

How do environmental policies affect profits?

Profits may fall initially but increase in the long run due to cost savings and higher demand.

How do environmental policies affect stakeholders?

• Customers benefit from ethical products
• Employees gain pride and motivation
• Shareholders face short-term risk but long-term gains

What is a strong evaluative conclusion for environmental policies?

The impact depends on:

• Industry
• Scale of investment
• Consumer expectations
• Government regulation
  Firms that plan effectively benefit long-term.