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Going Green March 5, 2007

Posted by Kira in allances, Business-Society Issues, environment.
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The more companies are recognized as being responsible corporate citizens, the more they will profit financially and the better chance they will have to survive in the future. With all of the recent discussions on global warming, some companies are taking steps to make sure that they are perceived as environmentally responsible. Just as companies need to adapt their products to changing consumer tastes, they now must adapt to their customers changing wants and needs for a safer environment.

I just read an article in BusinessWeek that states that corporations are building alliances with environmentalist groups in order to be considered as more environmentally responsible. This is contributing positively to the businesses bottom line and to their public image. Just as a business has its own culture inside the organization, it also operates in a culture that exists on a broader scale. Right now, the culture in which businesses operate is going green.

Companies have fought being environmentally friendly for so long and that is a major reason why we face global warming to the extent that we do today. By allying with environmentalist groups, companies are strategically aligning with their former enemies. This is a smart business move because now companies can use being environmentally friendly as a competitive advantage. This will also allow companies to build their reputation which is very important. Every business wants to be first to market. If companies use this as a competitive advantage then other companies will eventually follow suit and hopefully all businesses will be safer for the environment.

I never thought of the idea of businesses aligning with activist groups. I always think of business alliances or mergers as between two companies that produce products for profits. In the short-term, companies will probably lose money since they have to change their means of production to be safer for the environment. However, these initial expenses will be offset due to savings realized by going green. For example, windows that cost more today will hold in the heat better and reduce heating costs later on.

Over time, companies that are environmentally friendly and are supported by environmentalist groups will be more competitive. As a customer I would be more inclined to support and invest in a company that is going green. As an employee, I would rather work at a corporation that was green rather than one that was harmful to the environment. Therefore, corporations that are green will be able to attract and retain a more loyal and more productive workforce. Hopefully, other companies will catch on and do the same.

 

What do you think of the strategy of allying with an activist group? How do you think an alliance like this would be implemented? Do you think that companies could use “going green” as a long and/or short-term competitive advantage?

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Comments»

1. Lady - March 6, 2007

I remember taking an environmental course that dealt with the affect that businesses have on the environment during my freshman year at Bucknell. And now that I think about it, it was always the business vs. the government, or the business vs. the activist group or grassroots organization. The course never really mentioned the possibility of corporations teaming up with activist groups in order to help the environment. Moreover, never in my mind had I thought that corporations could actually gain a competitive advantage by teaming up with activist groups.

I guess we have come a long way in just a few years. As annoying as it may seem, I think we should keep pushing the global warming issue (even it is isn’t as serious and crucial as we are making it out to be). Eventually more companies will give into the peer pressure and follow suit. It is costly in the short run but definitely has its advantages in the long run. Corporations will end up becoming more efficient than they imagined they ever could be.


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