The literature in the field of sustainable development (SD) of businesses is piecemeal and diverse. This paper identifies and integrates principles that businesses could use for transformation towards SD. This is done through analogical reasoning from the source context of ecological systems to the target contexts of business socio-economic systems and machine/technology systems. The methodologies of systems thinking and morphological analysis supplement the analogical reasoning. Based on this, twelve principles for sustainable development of business are inferred for business managers and policy makers.
Our world consists of islands of prosperity, viz., large businesses and wealthy governments, amidst oceans of deprivation, viz., poverty, social malaise and ecological degradation (UNGC Accenture, 2010). Our ecological footprint currently exceeds the earth's carrying capacity,3 and continues to increase. Hence, society and businesses should pursue the path of sustainable development (SD). This paper attempts to synthesise principles for SD of businesses for use by professionals, managers and policy makers.
Sustainable development can be defined as “development that meets the needs of the present, without compromising the ability of future generations to meet their own needs” (WCED, 1987–section 3, page 16). Sustainable development of business involves preservation and enhancement of the existing stock of resources – financial, ecological, societal, human, physical, and others – which businesses depend upon quantitatively and qualitatively, and in the short- and long-run (Stiglitz, Sen, & Fitoussi, 2009). Sustainable development of business also involves the reduction of waste and risks in the socio-ecological context (Hanson, Finisdore, Ranganathan, & Iceland, 2010), while meeting the materialistic needs of society at appropriate prices, quality, and timeframes.
Sustainable development of business needs to be measured against the triple bottom line of people (society), planet (ecology) and profit/prosperity (economy) (Elkington, 1998). Historically, the ideologies of feudalism/traditionalism, capitalism, communism, and modernism had their own impact on the triple bottom line (Dresner, 2002). The current questions on sustainability lead to considerable speculation on the sustainable development of business in the future. Key milestones relating to voluntary initiatives for SD of business (WBCSD, 2000) since 1970 are given in Table 1.
The principle of lifecycle orientation has been discussed in detail and the corresponding sub-principles have been stated in the context of ecological systems sustainability. The sub-principles for sustainability of business SE and MT systems have been inferred using analogical reasoning. Eleven other principles for SD of business, supporting the principle of lifecycle orientation, have been briefly discussed. They are conceptually classified using the three constituent dimensions, viz., potential, connectedness, and resilience, of the panarchy model. The exact prioratisation of these principles in a business organisation will depend upon the context. The context will significantly depend upon the impacts of the organisation on the triple bottom line as well as stakeholder expectations.
The inferred principles are based on conceptual understanding from ecological systems, and instances of SD initiatives of businesses. These require qualitative and quantitative empirical evaluation on a larger scale and in the Indian context. Further, while the principle of lifecycle orientation is the cornerstone of all principles, the other 11 principles supporting lifecycle orientation may not be collectively exhaustive. The conceptual classification of these 11 principles along the three dimensions needs empirical validation. A classification of a principle on a dimension may not be water tight, and a principle may, in fact, affect other dimensions. These constitute the limitations of this work.
Future research based on this paper could include:
a)
Scaling these 12 principles, providing weights for them under the three dimensions, and developing a systems dynamics, data envelopment analysis (DEA) or multi criteria decision model for an Indian business or economy. Such a model can measure the impacts of these principles on the triple bottom line or an intermediate variable like innovation towards SD.
b)
Creation of a dependency framework with the morphological elements discussed earlier (Table 2), on the triple bottom line, to aid in point (a) above.
However, these 12 principles for SD of business are practical, implementable, and have been piloted in several organisations successfully as briefly discussed. These principles can be mutually reinforcing (e.g. control, security and learning) and occasionally contradicting (e.g. limited use of inputs and redundancy).
Lack of social/ecological sustainability in organisations entails the risk of modern business firms becoming the dinosaurs of tomorrow. Modern businesses may then be replaced by more sustainable forms of organisations that meet society's materialistic needs. The principles and discussions in this paper would help organisations wishing to pursue the path of SD to synthesise their ideas and ensure their longevity.
