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Recommended Readings: Business Strategy

 

Green And Competitive: Ending The Stalemate by Michael E. Porter And Claas Van Der Linde

The prevailing view is that there is an inherent and fixed trade-off: ecology versus the economy. On one side are the social benefits that arise from environmental standards. On the other side are the private costs to industry of prevention and cleanup that lead to higher prices and reduced industrial competitiveness. The authors argue that this is a static view. Companies are constantly finding innovative solutions in response to pressures of all sorts-from competitors, from customers, from regulators. The authors emphasise that tougher environmental standards can actually enhance competitiveness by pushing companies to use resources more productively.

 

Today managers and regulators focus on the actual costs of eliminating or treating pollution. To end the stalemate, they should focus instead on the enormous opportunity costs of pollution- wasted resources, wasted effort, and diminished product value to the customer. Managers must start to recognize environmental improvement as an economic and competitive opportunity, not as an irritant or a compliance issue.