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  • Print publication year: 2019
  • Online publication date: May 2019

Introduction

    • By Daniel C. Esty, Hillhouse Professor at Yale University with primary appointments in Yale's Environment and Law Schools and a secondary appointment at the Yale School of Management.
  • Edited by Daniel Esty
  • Publisher: Anthem Press
  • pp 1-18

Summary

Business leaders in the twentieth century focused on delivering shareholder value. They paid attention to top-line growth and bottomline success. Environmental degradation emerged as a concern in the 1990s across the corporate world, including in Latin America. But while pollution impacts, ecosystem vitality, and natural resource management became top-tier policy concerns in recent decades, those topics remained secondary priorities for almost all companies until very recently. Executives in major enterprises viewed environmental matters as a regulatory compliance issue to be dealt with by lawyers and engineers.

Business attitudes toward the environment— encompassing energy use and the broad range of topics associated with sustainability— have now shifted dramatically. Today's leading executives understand that their companies have social responsibilities. Of course, they are still accountable to their shareholders. But understanding that business success cannot be achieved at the expense of society means companies must also answer to an array of other stakeholders— from customers to employees to the communities in which they operate and, indeed, to society more broadly.

This obligation takes on new importance in the context of emerging planetary boundaries. As Johan Rockström and his colleagues at the Stockholm Resilience Center have highlighted, human-induced stress on various Earth systems threatens to push the planet beyond its “safe operating space” along a number of dimensions— from climate change to biodiversity to water availability and ocean acidification. In addition to these ecological threats that may impinge on the quality of life on Earth, other researchers have identified a set of social strains— including poverty, income inequality, and evolving employment structures— that threaten the fabric of our communities. Where at one time this entire agenda would have been seen as the purview of governments, business today shares responsibility for society's response. As Peter Bakker, president of the World Business Council for Sustainable Development (WBCSD) and former CEO of the Dutch logistics company TNT, likes to say, “Businesses cannot succeed in societies that fail.”

Simply put, a sustainability imperative now looms over the business world. This book offers guidance on how to manage the various dimensions of this sustainability agenda— providing lessons from a dozen case studies across Spanish-speaking Latin America and the sustainability management literature more generally. Of course, the optimal response to sustainability will vary by industry and geography.