Why Ecology and Economy Policies Are Inseparable Video

In Chapter 9 of 16, environmental management expert Andrew Hutson highlights common misconceptions about corporate sustainability and green business, namely that there is a trade-off between ecology and economy. Hutson refutes this claim and detai...
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Why Ecology and Economy Policies Are Inseparable? Erik Michielsen: What are the common misconceptions about green initiatives and what are you doing to educate corporations about what it really means to be green today? Andrew Hutson: The most common misconception is one that’s been out there probably since beginning and that’s there is a trade-off between ecology and economy. When realistically, you can’t separate the two and you can’t separate the two for a number of reasons. One is because you know that if you’re talking about the bottom-line, there’s always an efficiency argument to be made and that’s very, very basic. So inputs cost money, waste cost money, if you could control pollution or if you can prevent pollution before you have to control it instead of paying for treatment or paying for someone to haul it away, you just prevent from doing it. First places kind of comes from the Japanese kaizen approach, anything that is—or waste is bad. So even if you take it to a very basic essence, you’ve got that piece of it which is there’s no trade-off there. And there’s been a lot of scholarship and lot of consultants that just thought about this a lot and try to shatter this idea of their being a trade-off. But even more strategically, we’re rapidly approaching a world that has very few tolerances left that we can surpass and so, you can look at preserving a forest as just something that is purely for the ecology of a nation. But in essence, it’s also the capitalist stock of the nation. There was some studies, I went back to Indonesia in 90’s and ahead just outrageous growth and some economist went and corrected for the amount that they’re cutting to their capital stock and the growth went like from 78% to like 2% because what they were doing was kind of cutting in to their principle instead of leaving out the interest. We’ve done that re-large for a very, very long time and what we’re quickly getting to the point where we can’t cut in to the capital much more without seriously impacting the way that we live. And so, our economy is ultimately predicated on a thriving ecology and without that you know companies will be spending a lot of money, trying to procure resources. Communities will be spending a lot of money in order to get things like clean water and we already are. So those two things, you have to necessarily and sort of break that trade-off. And it’s really strange because you can still hear it and this is an old of argument from the 70’s that the time it was a large of argument because we looked at command to control regulations. That was the case. Everything that the government did was going to impose a cost. But companies now that are proactive and the way that regulations are structured that are market based like the cup and trade SO2 program from the 90’s which end of costing attempt of the cost that was estimated ended up providing in a hundreds of billions of dollars and benefits through improve health of citizens and through infrastructure damage that wasn’t avoided. It was market friendly. A lot of people made a lot of money trading permits in that sort of a precursor to carbon market now or really smartly structured regulations that drive innovation rather than imposing cost. And so, I think fundamentally there is this myth that’s still out there and so what we do is we go in to companies and we attempt to sort of spell that out. And it’s funny because in the last couple of years that job has gotten away easier. That used to be the pitch. We’ve come and say, “Look there is no trade-off” and now we go in and we’re meeting with very smart managers and executives that say, “Yeah, yeah we know but tell us what to do”. And so, we rapidly have to change our strategies saying from sort of telling, you’re trying to teach the lesson that is not a trade-off to well now here is how you execute on that strategy effectively. And that’s proving both inspiring and challenging.

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