Responsible Business Leadership
Week 1: Sustainability
Planetary boundary= the space in which we
can safely operate.
Why is it relevant for business?
A business environment is a natural
environment that cannot ourish without also
using natural resources.
Triple bottom line= business should not only
create wealth and prosperity but also protect
environmental quality and create more social
justice. The proper use of the TBL involves, at
minimum, progress on two dimensions while
the third remains unaffected.
Circular Economy
A Circular Economy can increase resource ef ciency by
3% annually, saving Europe €600 bln in primary
resources and yielding €1200 in non-resource costs and
externalities per year by 2030.
Business as usual will also improve resource ef ciency through innovation, but more so in
a circular economy scenario:
1. Rebound effects can be minimized
Rebound effects= new technology can increase
resource ef ciency, but this may increase
consumption, thereby reducing expected ef ciency
gain.
2. System-level innovation can match product-level
innovation.
Products can be made sustainable, but the process
of making the products should be made sustainable
too.
Unrealistic assumption of the linear economy:
1. There is an unlimited number of natural resources.
2. The environment has an unlimited ability to absorb waste.
Three loops for a circular economy:
1. Narrowing loops: we want to use higher resource ef ciency, this is not only the case in
circular models but also in linear models.
2. Slowing loops: utilization period of products extended and/or intensi ed.
3. Closing loops: closing loop between post-use and production through recycling.
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, Life Cycle Analysis
The idea is to look at the whole value chain and inspect the social or environmental impact
at each stage.
Stage 1: Goal & Scope (we de ne what we want to achieve
Stage 2: Life cycle inventory analysis (look at the whole value chain)
Stage 3: Life cycle impact assessment (categorize resources into impact categories and
calculate their contribution to that category)
Stage 4: Life cycle interpretation
Ecological Footprinting
Ecological footprint= sum of all biologically productive areas needed to meet human
demand (e.g. per service, per person, for all of humanity).
Biocapacity= sum of all biologically productive areas that are available (e.g. per country,
for the whole planet). Aim: ecological footprint < biocapacity planet.
Sharing economy= idea of a new economy, based on trust and stronger communities.
Peer-to-peer exchange, scaled up through digital platforms.
Product-Service System
1. Product-oriented: sale of products, but with extra services.
2. Use-oriented: provider remains the owner of the product, merely makes it accessible in
some form.
3. Result-oriented: client and provider agree on a result, no pre-determined product, no
product choice.
Environmental bene ts:
- increased resource and
energy ef ciency
- Increased product usage
- Dematerialization (fewer
materials needed)
Economic bene ts:
-Better ful llment of customer
needs (you sell both product
and service)
-Increased revenues
-Reduced risk (you can rely on
recycling instead of your supply
chains)
Week 2: Responsibility
Separation of ownership and
control. Managers have a duciary duty to
nanciers to not spend their investments on
wasteful initiatives and actions that reduce value.
Milton Friedman= the only responsibility of a
business is pro t.
fi
fifi fifi fi fi fi
Week 1: Sustainability
Planetary boundary= the space in which we
can safely operate.
Why is it relevant for business?
A business environment is a natural
environment that cannot ourish without also
using natural resources.
Triple bottom line= business should not only
create wealth and prosperity but also protect
environmental quality and create more social
justice. The proper use of the TBL involves, at
minimum, progress on two dimensions while
the third remains unaffected.
Circular Economy
A Circular Economy can increase resource ef ciency by
3% annually, saving Europe €600 bln in primary
resources and yielding €1200 in non-resource costs and
externalities per year by 2030.
Business as usual will also improve resource ef ciency through innovation, but more so in
a circular economy scenario:
1. Rebound effects can be minimized
Rebound effects= new technology can increase
resource ef ciency, but this may increase
consumption, thereby reducing expected ef ciency
gain.
2. System-level innovation can match product-level
innovation.
Products can be made sustainable, but the process
of making the products should be made sustainable
too.
Unrealistic assumption of the linear economy:
1. There is an unlimited number of natural resources.
2. The environment has an unlimited ability to absorb waste.
Three loops for a circular economy:
1. Narrowing loops: we want to use higher resource ef ciency, this is not only the case in
circular models but also in linear models.
2. Slowing loops: utilization period of products extended and/or intensi ed.
3. Closing loops: closing loop between post-use and production through recycling.
fi fl fi fi fi fi fi
, Life Cycle Analysis
The idea is to look at the whole value chain and inspect the social or environmental impact
at each stage.
Stage 1: Goal & Scope (we de ne what we want to achieve
Stage 2: Life cycle inventory analysis (look at the whole value chain)
Stage 3: Life cycle impact assessment (categorize resources into impact categories and
calculate their contribution to that category)
Stage 4: Life cycle interpretation
Ecological Footprinting
Ecological footprint= sum of all biologically productive areas needed to meet human
demand (e.g. per service, per person, for all of humanity).
Biocapacity= sum of all biologically productive areas that are available (e.g. per country,
for the whole planet). Aim: ecological footprint < biocapacity planet.
Sharing economy= idea of a new economy, based on trust and stronger communities.
Peer-to-peer exchange, scaled up through digital platforms.
Product-Service System
1. Product-oriented: sale of products, but with extra services.
2. Use-oriented: provider remains the owner of the product, merely makes it accessible in
some form.
3. Result-oriented: client and provider agree on a result, no pre-determined product, no
product choice.
Environmental bene ts:
- increased resource and
energy ef ciency
- Increased product usage
- Dematerialization (fewer
materials needed)
Economic bene ts:
-Better ful llment of customer
needs (you sell both product
and service)
-Increased revenues
-Reduced risk (you can rely on
recycling instead of your supply
chains)
Week 2: Responsibility
Separation of ownership and
control. Managers have a duciary duty to
nanciers to not spend their investments on
wasteful initiatives and actions that reduce value.
Milton Friedman= the only responsibility of a
business is pro t.
fi
fifi fifi fi fi fi
