Write of the following questions.These responses should reflect your own thinking. You must find your own examples and application and not those or your study.
1. What are the key drivers in the Age of Responsibility, according to Wayne Visser? In other words, what is causing companies to take sustainability more seriously, and what are some of the reasons or evidence for this shift in the market? What are some of the consequences for companies that ignore sustainability as a driver?
2. Why does Visser view Walmart as an example of a company worthy of emulation? What are some of the problems about how sustainable companies have introduced sustainable products and services into the marketplace, and what does Walmart’s best practices have to teach us about sustainability? Furthermore, hy would Walmart pursue sustainability, if its primary objective is profit?
3. What does it mean to be responsive in the Age of Responsibility? Provide examples, and explain the trade-off between responsiveness and scalability.
Key drivers in the Age of Responsibility according to Wayne Visser
1. According to Visser (2014), Age of Responsibility represents a deeper reflective state of world, people and business that brings about a change in the lives of the people. It is also a reflection of Wayne’s evolved relationship with the corporate sustainability and responsibility since it helps in guiding the ways that led to the emergence of concepts for driving practices. Although this has made a positive difference in the world but has failed in harnessing power of capitalism into a force for the creation of a positive impact. Wayne Visser thus puts forward how an older model of Corporate Sustainability and Responsibility (CSR) is gradually been replaced by the movement of the second generation. The generation has moved beyond the outmoded approach of the CSR representing public relations or philanthropy towards more interactive and stakeholder driven model. The core message indicates that CSR has failed to bring about an improvement in quality of economic, social and ecological life. For attaining success, CSR need to get transformed into the new CSR 2.0. However, the key drivers of the age of responsibility include scalability, creativity, glocality, responsiveness and circularity.
The reasons that are causing the companies in taking sustainability more seriously includes:
- Impacts of Climate Change and Environmental Degradation:The sustainability issues identified by the World Economic Forum includes extreme weather, water and the change of the climate as top most risk in the global business (Jabareen, 2013). Climate change and environmental degradation have led to the creation of an unexpected risk in the corporate value chains. Companies within the food sector remains quite vulnerable as product lines remains threatened by the climate change. The environmental threats also had an interconnected nature that resulted in the cascading risk. For example, drought in Pacific Northwest of the United States severely affected the operations of Anheuser-Busch, one of the world’s largest brewers of beer. The dip in the irrigation of water facilities raised the price of barley that is one of the key ingredients of the beer.
- Companies Damaging the Environment Can no Longer Hide: Companies nowadays operates within a global fishbowl with all its flaws on a complete display. This is because the NGOs are taking complete advantage of the communication technologies, advanced information and lower cost remote sensors in exposing the practices of the company and holding theme responsible for the environmental damage (Welford, 2013). Therefore, it has become harder in hiding bad things. In this regard, the example of Gibson Guitar Company can be drawn as it tarnished its reputation after having to pay fine for the usage of the exotic wood imported from India and Madagascar. Besides, there has been emergence in the investor friendly tools that helped in providing information linked to environmental conditions and the company’s operation. The Global Forest Watch is one such online tool that puts forward higher resolution and real time information on the aspect of deforestation across the globe thereby shifting the spotlight on the businesses that contributes towards deforestation.
- Sustainability Acts as Major Driver for Competitiveness and Business Strategy: Although the investment community continues to linger on sidelines of sustainability, however members belonging to the corporate community view it as the foundation in determining the competitive advantage (Lozano, 2015). This is because; sustainability is a meta-trend that also includes globalization, information technology and mass production. Major corporations now consider comprehensive commitments towards the aspects of sustainability. For example, Philip committed itself in investing close to € 2 billion in the innovation of green product by the year 2015 while Wilmar, one of the leading agribusiness groups of Asia is committed towards deforestation free supply chain. Close to 53 percent of the companies surveyed engaged the investors on the sustainability initiatives. Nevertheless, a special section of investment community and social, environmental and corporate governance is taking steps in shifting the investment away from the business causing harm to the environment towards business that represented better stewards of the nature.
However, some of the consequences of ignoring sustainability as the driver lead to the reduction of growth, financial crisis and an impact on the decision-making and strategy at all levels. This is because; sustainability is a central approach of doing business since it focuses on paying attention to long term outlook, social viability and future business sustainability (Gast, Gundolf & Cesinger, 2017).
2. Visser viewed Walmart as the example worthy of emulation due to the following reasons:
- Walmart considered Sustainability in all its Operations:The sustainability initiatives undertaken by Walmart helped in bringing about a positive change within communities across the world (walmart.com, 2018). The initiatives included reduction of the emissions of the green house gas, reduction of waste and advancement of land and water stewardship.
- Walmart includes the aspect of Sustainability in Value Chains: As the global retailer, Walmart possess the potential of influencing sustainability at each of the levels of supply chain (walmart.com, 2018). The supermarket chain collaborates with the suppliers in making sure that the products sold are safe, affordable and sustainable. Some of the initiatives include, supporting transparency and measurement, reducing the impact on the environment, ensures providing safe, healthy and affordable foods and products and supporting the dignity of the worker.
Some of the challenges that sustainable company faces while introducing sustainable products and service into the market are as follows (Laszlo & Cescau, 2017):
- Identification of the appropriate technology ideal for the income generation through the adoption of sustainability
- Examination of the implications and the impacts of the national policies in making recommendations for extension of specific technology
- Diagnosis of the policy level impact on the green technology on the income generation under the framework of sustainable development
- Review of the challenges and the availability of the policy options for adopting sustainability that integrated the key goals like the economic profitability, environmental health and the economic and social equity.
However, the best practices of Walmart in teaching about sustainability are as follows (walmart.com, 2018):
Burning Less Amount of Fuel: One of the ways in which Walmart accomplished it was through cutting the fuel usage if the fleet trucks for lower the carbon emissions and the fuel cost. In order to achieve this, Walmart enhanced number of its pallets from 24 to 26. It also adopted ways of enrouting the trucks that encouraged enhanced multi shop routes, routing the trucks in a manner for minimizing distance, reducing the miles of travel of an empty or half-filled truck and routing the trucks for minimizing travel in the hilly and the congested areas.
Preparation for a Supply Chain in Dealing Extreme Weather: Extreme weather conditions such as hurricane cause major disruption in global supply chain of Walmart. As prevention from such disruption, Walmart appointed its own meteorologist for keeping a track of the hurricane. Not only that it also stocked the distribution centers away from the path of hurricane for ensuring quicker resupply of the stores immediately after a hurricane. Besides, Walmart also shortened the network for the global supply chain that depended heavily on the cargo ships.
Influencing Suppliers: Walmart leveraged close to over 66,000 suppliers thereby encouraging the sustainable practices. For instance, Walmart recommended Unilever in reformulating the laundry detergent into higher concentration and smaller packaging there saving on the packaging and the shipping cost.
Walmart should pursue sustainability even when its objective remains in determining profit since it will help the retail chain in reshaping the ways of achieving lasting and significant improvement in the social and the environmental outcomes. This helps in not only improving the business but it also accelerates the company in achieving the aspirational goals of creating zero waste, operating with the help of 100 percent renewable energy and the selling of the products that helps in sustaining the environment and the resources(walmart.com, 2018). It also enables retail chain like Walmart in creating an increasingly sustainable value chain.
3. Responsiveness in the Age of Responsibility implies greater transparency through the reporting mechanisms like the carbon disclosure project and the initiative of Global Reporting (Visser & Tolhurst, 2017). Scalability refers to the massive scale defining the poverty and the climate change. Scalability is limited to the retail sector. In the aftermath of Bangladesh famines, Muhammad Yunus, built a bank that provided loans up to $2.5 billion to enterprises and spawned over 3000 microcredit institutions in close to 50 countries reaching over 133 million clients, has been a prominent example of scalability.
The practical steps for defines the trade offs between scalability and responsiveness include:
- Adoption of investing principles that helps in assessing effectiveness of the philanthropic and the community developing expenditures
- Institutionalizing varied stakeholder panel for providing honest feedback towards the sustainability performance of the organization.
- Engage in the positive, constructive lobbying on the strategic environmental, and the social issue.
- By embracing approaches of Web 2.0, that includes crowd sourcing and social media for improvement of transparency. This includes sites like JustMeans
- Working actively for advancing the integrated full accounting and reporting cost. For example, ContextReporting.Org does it with the benchmarking platform while Puma does it with the profit and loss account related to environment.
Gast, J., Gundolf, K., & Cesinger, B. (2017). Doing business in a green way: A systematic review of the ecological sustainability entrepreneurship literature and future research directions. Journal of Cleaner Production, 147, 44-56.
Jabareen, Y. (2013). Planning the resilient city: Concepts and strategies for coping with climate change and environmental risk. Cities, 31, 220-229.
Laszlo, C., & Cescau, P. (2017). Sustainable value: How the world's leading companies are doing well by doing good. Routledge.
Lozano, R. (2015). A holistic perspective on corporate sustainability drivers. Corporate Social Responsibility and Environmental Management, 22(1), 32-44.
Visser, W. (2014). CSR 2.0: Transforming corporate sustainability and responsibility. New York, NY: Springer.
Visser, W., & Tolhurst, N. (2017). The world guide to CSR: A country-by-country analysis of corporate sustainability and responsibility. Routledge.
walmart.com (2018). [online] Available at: https://corporate.walmart.com/global-responsibility/sustainability/ [Accessed 5 Dec. 2018].
walmart.com. (2018). Retrieved from https://corporate.walmart.com/global-responsibility/sustainability/sustainability-in-our-operations
walmart.com. (2018). Retrieved from https://corporate.walmart.com/_news_/executive-viewpoints/making-sustainability-sustainable-lessons-weve-learned
walmart.com.(2018). Retrieved from https://corporate.walmart.com/global-responsibility/sustainability/sustainability-in-our-value-chains
Welford, R. (2013). Hijacking environmentalism: Corporate responses to sustainable development. Routledge.
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