The Greening of Business: A Public and Private Process

Increasingly, individuals, businesses and governments are committed to the creation and promotion of sustainable and environment-friendly businesses, that is, green business. Many businesses are looking for ways to be more green by using fewer resources, creating less and more benign waste, and promoting consumption with low environmental impacts. Other businesses are not focused on the environmental impact of their activities as much as would seem warranted by current environmental problems. In both cases, there is a role for business, government and environmentally-oriented investors to support and promote the further greening of business.

We will focus on how green-oriented businesses can be supported, internally and externally, and on how to promote more environmental goals among other less-green oriented businesses. We will explore the challenges. Is greening of a business limited by competition from less environmentally-oriented business? Are some businesses cynically promoting themselves as green as an advertisement strategy without deep commitment? Is it worthwhile to nudge Walmart or McDonalds to engage in more environmentally benign practices, or should focus remain on companies that seem more naturally green? How can investors, through financial decisions including the purchase and sale of stock, influence green practices? What are the most effective means by which government promotes environmentally sound practices through regulations and other means?

We will address these questions as we explore what it means to green a business-from the perspective of stakeholders inside and outside the organization. We will discuss the various financial, economic, and governmental forces that influence financial and economic decisions at both a personal and business level.

In the process, we will gain a basic understanding of finance and environmental economics, including quantitative reasoning (e.g., the time value of money, calculating rates of return and the cost of capital), financial market fundamentals (buying and selling stock, puts, calls, and options), and economic models of environmental regulation.