Sustainability concepts and applications

Sustainability

The new paradigm in economics is sustainability. Initiated and driven by human and ecological concerns typically ignored in dominant economic models, sustainability has taken on the force of a revolution in recent years. It has altered the way business is set up and run. Its focus is on systematic changes in economics that promote biodiversity, resource preservation, and health. This essay outlines how these sustainable concepts are important for economics.

One important concept in sustainability is the interconnectivity of humans and the natural environment. Sustainability recognizes that business practices can influence the environment in damaging ways that affect the viability of both natural and human environments. For example, water pollution from factories and mines has deleterious effects on woodlands and on human populations nearby which use the water source. This is important for sustainability because it sees environmental vitality as crucial for continuing human existence. As a result, the impact of business must be scrutinized in terms of the environment, and businesses should adopt guidelines for assessing the impact of a company's action on the surrounding community. Such a framework shows that in sustainable values, business must work to decrease contamination of the natural environment, reduce greenhouse gases, decrease synthetic man-made chemicals, respect biodiversity and conservation, use renewable energy efficiently, and manage resources well. In other words, sustainability values good ecological stewardship.

Another important concept is long-term thinking and the de-prioritization of money. Often businesses look only to saving money in the short-term, neglecting the long-term savings associated with high initial investments. There are long-term cost benefits in reducing energy expenditure, eliminating waste, using more energy efficient vehicles, recycling rather than depleting natural resources, and using green designs and buildings. Furthermore, sustainability says that size and monetary wealth are not the best measures of economic health. Profit is sought, but not at the expense of short-cuts that hijack human capital for material capital. Goerner et. al. (2008) states, "Economists, therefore, tend to assume that funneling large amounts of cash to elite players to build factories, dams, stadiums or other material means will automatically produce 'development' and, from there, a healthier society" (p. 161) Sustainability rejects this. The sustainable model suggests that investment in humans is not a burdensome cost for reduction, but a valuable investment in economic viability and longevity.

Hawkens et. al. (1999) argues that the next stage of capitalism will be based on: 'bio-mimicry" (redesigning industrial systems to be like biological systems such as recycling organic waste; resource productivity based on new designs and technologies that reduce use through constructive resource application; service and flow -- not emphasis on goods or purchases but on smooth flow of service; and reinvestment in natural capital (human and natural resources). By adopting these strategies, a business can gain competitive advantage as models change to emphasize sustainability. In other words, sustainability is important for current economic trends.

Another dominant concept important for sustainability is the Precautionary Principle. Edwards (2005) writes, "This principle asks businesses to use foresight in the development of new products and processes and, if these are deemed potentially dangerous to society, to refrain from further action" (p. 55). This ethical concept shifts responsibility from the consumer and regulators to the business itself. The burden lies with the company to prove that technologies, chemicals, or practices are sustainable and safe. This is important because many companies view the requirement of proving non-hazards as an obstacle to technological advancement.

Maybe the most important concept in sustainability is that economic development is human development. This view integrates culture and economy. "The economy represents our societal metabolism; it processes resources and information and circulates the resulting products throughout" (Goerner et. al., 2008, p. 157). Prosperity is a function of human capital and local networks of collaboration. This is important since it reverses top-down notions which promote material means (factories, money, convention centers) and the interests at the top by ignoring the health of those at the bottom. It refuses to prioritize rugged individuals, capitalists, and managers over those upon whose work their success is built. It calls on businesses to empower individuals, families, and community groups to organize, educate, and innovate in sustainable ways. At the heart of this is the notion of local networks. Energy and intelligence should come from the local community for a business to be considered sustainable. Wealth should not be siphoned off to absentee owners, but kept local and distributed fairly.