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Sustainable development refers to the development that meets the requirements of the present generation without depleting resources for the future generations. Following the current economic challenges, professed not only in the developing nations but also globally, more vigilance is demanded during the establishment as well as running of companies. This follows the evident verity that companies should be launched with an intended aim of making profits as well as contributes to national development. Additionally, they ought to be environmental friendly, especially now that issues, pertaining to global warming, have become so alarming. The companies should also show concern for the present and the future generations. This document will mainly focus on a detailed study of sustainable development, its importance and the various ways that it can be executed.
Why sustainable development is important
One of the prime challenges in manufacturing today is sustainable manufacturing. Sustainable manufacturing refers to innovation of technologies to renovate materials without release of greenhouse gases, using non-renewable materials or poisonous materials or generating waste. To respond to the environmental issues that were emerging in connection to the environment, organizations should be ready to strengthen their pledge towards protecting the environment by tackling environmental issues universally (Schenk et al., 2001). As a follow up, companies should adopt the Global Environmental Declaration, which offers guidelines on how all the companies should strive to assess all the environmental effects of their activities, manufacture products that lessen the use and dumping, reuse and preserve resources and power, and, at the same time, heighten awareness about the environment among the coworkers and the society.
Comparison of the expected cost to carry out the project is done against the potential benefits in order to establish whether the project will be beneficial or not. Integration of the triple bottom line has been reckoned as one of the most beneficial expression that can be embraced to ensure that corporations takes a special consideration of such critical fields including environmental, social and financial areas of all the business transactions. This intelligent expression helps in identifying the necessity of the financial as well as the non-market areas of the commercial presentation and responsibility. During formulation and carrying out projects, the managerial bodies should call upon investors and the other shareholders to come up with more policies that directly or indirectly support triple line reporting.
Impact of lean Six Sigma on the Environment
Lean Six Sigma is an approach, meant to increase efficiency in organizations and reduce defects. This approach leads to the reduction of emissions and pollution in manufacturing plants. This approach also leads to sustainable development due to the safe guarding of environmental resources. Lean manufacturing leads to the existence of a cultural and operational environment that is conducive for minimizing waste and preventing pollution. It leads to a culture that is employee-involved and enables continuous improvement. Lean processes lower the time and capital intensity in producing goods and services. Lean processes have minimal defects in products, less downtime, low inventory and little wasteful movement. Through this, a smooth and rapid flow of products is achieved (Schenk et al., 2001).
The idea of reducing waste for financial gain has been a philosophy of Lean since its inception. Companies that have adopted lean principles have made significant efforts to advance the environmental performance by devotion to improve the business performance through elimination and lessening of non value-adding steps and activities. Despite the fact that these activities are being propelled primarily by cost and time reduction, they also lead to an improvement in the environmental performance.
Among other practices, enforced by Lean, the US Environmental Protection Agency (EPA) observes that it produces an environment that is conducive to minimize waste and, at the same time, preventing pollution (Schenk et al., 2001). Another considerate advantage of Lean is the verity that it can be more leveraged to produce more environmental impacts. It is also evident that there are opportunities to not only conserve, but also improve the environment if the firm is going on board with Lean initiatives and investments.
Industrialization and sustainable development
Taking into consideration the fact that industrialization has become so pronounced around the globe, there is a need to put some factors into consideration before carrying out any project as well as provide answers to some questions. The questions should be directed towards establishing whether the project will fulfill the intended goals of the company and whether its benefits outweigh its cost. Carrying out a cost-benefit analysis is one of the most effective decision-making approaches in doing this (Ikerd, 2005).
After the onset of the industrialization era, the traditional perception of accounting shifted from being just a mere language of the business arena to the extent of covering other areas to transform the perception of people on the same. Accounting in running businesses is expected to cover all the other professions, while focusing on people, planet and profit. Many scientists as well as business personnel’s aim is focusing on the economic benefits and costs in many different areas in the business platform. Since ages, many businesses have been aware that cost-benefit analysis is concerned with the maximization profits. Though the main aim is to gain more material resources, it also encourages improved relationships between the company and the society as well as the environment, hence, encouraging triple bottom line reporting.
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In any business activities, economic viability is one of the most crucial components that contribute to economic boom. The fact that many corporations aspire to succeed and consequently outshine their competitors obliges the respective managers to come up with special strategies that will enable the company realize its visions. John Ikerd in his book, Sustainable Capitalism: a matter of common sense, explains that social and intellectual integrity is crucial for the success of any business in order to make profits (Ikerd, 2005). This has the implication that businesses that lack these entities will soon lose their economic viability, which could lead to its downfall.
One of the main recommendations that Ikerd suggests is finding ways to fix the challenges environmental pollution like by transforming wastes to assets that can be re-used to generate profit. He, further, explains the importance of maintaining better relations with the inhabitants of the area, in which the business is operating. This includes all the people who directly or indirectly get involved in the general operations of the business. It, therefore, includes people such as the employees, customers, stakeholders and the investors among others. This concept follows the eminent idea that such people determine the progress of the company (Weber, 2006).
Another book by Andrian Henrques and Julie Richadson, The triple bottom line, Does it all add up?, explains that, sometimes, triple bottom line companies are able to secure sales of their stocks to specific investors who commit themselves to social and economic integrity (Richardson & Henriques, 2004). As such, the investors are obliged to accept low returns in case the net social and ecological returns are low to enhance long-term sustainability. It is for this reason that transactions can rarely take place between the triple bottom line investors and the single bottom line investors because the single bottom line investors are mainly concerned with exploiting the short term benefits, financial interests. Since this could be risky to the companies, exercising triple bottom line protection by the government from other competitors is important.
The role of accounting in sustainable development
The idea of accounting as being environmentally and socially responsible was basically introduced in classical Greece, where all businesses were expected to be embracing high morality. There has, however, been longstanding belief that people running businesses should have high responsibility towards both the environment and the society. Typically, corporate social performance falls under four primary headings (Ikerd, 2005). The first entails the community involvement, which involves the day to day activities of individuals in such areas like health and education. The second includes human resource, enclosing trainees and employees, ascertaining that the ambient working conditions are favorable. The third involves the physical resources and environmental contributions such as total adherence to environmental policies and the fourth is product contribution, which lays special emphasis on the quality of products.
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Currently, attitudes in business are changing, ensuring that individuals as well as companies are considering the environmental issues as well as the sustainability (Ikerd, 2005). This best explains the reason as to why many companies, especially those, related to energy, have more interest on reporting on areas that pertain to finance, the society and the environment as well. Environmental issues are currently being viewed as an international issue that needs to be addressed urgently.
In triple bottom line expression, companies are expected to present reports that manifest their efforts to sustainable development (Ikerd, 2005). Many nations have embraced the idea of sustainable development and though Australia was initially reluctant to adopt this expression, it was influenced by reports, disclosing environment concerns from other nations like Japan, hence, enforcing more responsibility on Australia, ascertaining that it adheres to policies, aligned with the environment.
As earlier mentioned, Sustainable Development is the development that meets the requirements of the present generation without depleting resources for the future generations. It, thus, entails production with vigilance not to destroy the environment as well as improving it. One of the main recommendations suggested is finding ways to fix the challenges environmental pollution like by transforming wastes to assets that can be re-used to generate profit. Generally, care must be taken to ensure sustainable development is achieved.
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