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The Top 6 Environmental Issues in Business

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Businesses are affected by major environmental issues and sustainability challenges. Climate change, pollution, and global warming impact a company’s bottom line because these top environmental issues in business reduce profits and productivity in the workforce.

Our world is facing important sustainability challenges that have global consequences. Alone, we cannot solve environmental issues in a measurable way. Businesses, on the other hand, have the reach, resources, and competency to make a tangible impact. This is why sustainable business is the most effective way to instigate long-term change that benefits both businesses and global consumers.

For a long time, companies did not see or want to see their large-scale impact on the environment. Yet, wherever you look, industries are there and it affects the landscapes in multifaceted ways.

Environmental issues have no borders. As environmental issues continue to worsen globally, businesses are seeing the responsibility they have to reduce their elephantine carbon footprints. Mass production needs mass amounts of resources. If we do not care for the planet, the precious resources we have will deplete, to the detriment of all. 

Companies that face environmental and ethical issues in business with solutions have a market advantage. Consumers are increasingly more likely to purchase from businesses with strong CSR strategies.

Below are some of the major environmental issues the world, and business world, are facing:

1. Pollution

Pollution is when contaminants gather in an environment and cause harmful or unfavorable effects. We see pollution in the air, water, and soil of our planet that have a harmful effect on human beings and global ecosystems.

The main contributor to air pollution is the excess burning of fossil fuels. Burning products that produce carbon dioxide, like fossil fuels, cause C02 levels to become unbalanced and affect our air quality.

Major contributors to water pollution are industrial waste, marine dumping, and the agricultural industry. Water pollution is from improper waste disposal and the use of harmful chemicals that seep into our water sources.

Smokestacks discharging pollution into the air at a factory.

How Pollution Affects Business

These are the primary ways that pollution can affect business:

Loss of Employees

Pollution affects business because it causes health problems in the workforce. According to the World Health Organization (WHO), air pollution causes 4.2 million deaths every year globally.

Pollution causes health problems in humans which has a direct effect on sick days and health benefits requested by employees. When employees face health problems, productivity decreases.

Loss of Resources

Pollution affects business because it depletes usable resources.

Of the 3% fresh water available on the planet, only 0.5% is drinkable. This is because the other 2.5% is frozen in glaciers or too polluted to consume. If we continue to pollute our water, we will continue to make scarce a life-giving resource.

Why Businesses Should Reduce Pollution

Pollution is one of the top environmental issues that businesses have a role in reducing. A 2017 study found that 100 businesses contributed nearly 71% of the greenhouse gas emissions on our planet.

If businesses make an effort to reduce their carbon footprint and use water-safe practices, the global production of air and water pollution will reduce dramatically.

Businesses produce large amounts of pollution to manufacture and transport products and power warehouses and storefronts. Consumers are aware that corporations have a larger environmental impact than single entities and are holding companies accountable for their environmental actions.

For example, airline companies are aware of their impact on global C02 emissions and are working to use cleaner fuel sources to combat their carbon footprint.

The company AeroFarms uses vertical gardening with 95% less water use than conventional agricultural practices and no pesticides.

These companies have recognized the impact of pollution and have made steps to mitigate their effects on the environment.

2. Climate Change

Climate change is a result of global warming. Climate change is the long-term shift in weather patterns and global temperatures due to rising carbon levels. Carbon emissions and greenhouse gasses trap heat in our atmosphere resulting in slight but ever-increasing temperature changes.

Climate change is one of the biggest environmental issues that we face because it affects all weather systems and climates around the globe. Droughts, forest fires, floods, storms, and natural disasters are all a result of climate change.

The main contributors to climate change are burning fossil fuels, industrial and agriculture practices, and deforestation.

How Climate Change Affects Business

These are the primary ways that climate change can affect business:

Loss of Employees

Climate change affects businesses because employees are relocating due to natural disasters.

Another way businesses lose productivity because of climate change is from increased sick leave requests. As a result of the California wildfires, laws were put in place to protect employees when requesting sick leave.

Loss of Product

Climate change affects businesses because natural disasters destroy warehouses, natural resources, and interrupt transportation schedules.

Wildfires caused by climate change overtaking a landscape

Why Businesses Should Care About Climate Change

Companies are seeing that going carbon neutral is beneficial to business.

Businesses are not impervious to the effects of climate change. Natural disasters affect crop production, destroy infrastructure, and destroy resources. A 2021 study of 750 executives reported that more than 25% are already noticing a scarcity of resources in the supply chain due to the effects of climate change.

Which brings us to our next environmental issue in business...

3. Depleting Natural Resources

Natural resources are objects sourced from the earth that we use in the production and manufacturing of goods.

We see examples of depleting natural resources from deforestation, mining, and agriculture. Deforestation is depleting our forests. We are using unsustainable amounts of wood in our production methods.

Mining is depleting fossil fuels and mineral deposits. At the same time, mining contributes to pollution and habitat destruction.

Overfarming is depleting the nutrients in our soil and our water supply.

We need to seek renewable energy sources, sustainable materials, and updated decision-making methods to ensure that the resources are protected for future generations.

How Depleting Natural Resources Affects Business

These are the primary ways that depleting natural resources can affect business:

Loss of Product

Depleting natural resources affects businesses because products that use the resource will be more expensive and difficult to manufacture.

If businesses do not have the resources they need to produce their products, what happens to that business if it does not adapt to a green future? It goes extinct too.

Loss of Profit

Depleting natural resources affect businesses because scarcity increases overhead.

Scarcity creates more market competition which increases prices for consumers. However, a higher sticker price does not result in increased profits, since overhead prices in production also increase.

Why Businesses Should Care About Depleting Resources

Economic sustainability is in the best interest of a business, especially one that relies on natural resources. Economic sustainability examples include companies like AgroFarms and Source water producing solar panels, which make a profit from sustainable methods of business.

Protecting natural resources gives longevity to a company, protecting the planet as well as profits.

As fossil fuels continue to be depleted, locally sourced products will have a market advantage with lower fuel costs.

According to one source, the return of investment on clean water is quadrupled due to reduced healthcare costs, increased productivity, and fewer premature deaths.

4. Habitat Destruction

Habitat destruction is when an environment becomes unsuitable to sustain normal life for inhabitants of that area or ecosystem. Habitat destruction is one of the top environmental issues in business because it contributes to depleting natural resources, pollution, and climate change.

We see habitat destruction of pandas, elephants, and tigers from the depletion of forest environments due to deforestation and human influence. But humans are increasingly finding their own habitats being destroyed which has a direct effect on business.

The 2020 wildfires in the United States burned millions of acres of forests. This destroyed animal habitats, displaced families, and resulted in increased insurance rates which drive up living costs.

The main contributor to habitat destruction is human influence from mining, deforestation, and overpopulation.

A seagull on a watery surface carrying a piece of litter.

How Habitat Destruction Affects Business

These are the primary ways that habitat destruction can affect business:

Loss of Employees

Habitat destruction affects businesses because as houses get destroyed and insurance rates increase, families relocate to cost-friendlier areas. The reduction of a viable workforce results in reduced production.

Loss of Product

Habitat destruction affects business because as we deplete our natural resources, products that use those resources can no longer be sourced. Habitat destruction results in higher overheads and, eventually, the inability to continue production of the product.

Loss of Profits

Habitat destruction goes hand in hand with resource depletion which raises overhead costs and cuts into company profits.

Another way habitat destruction affects business profits is through government initiatives to go green. Anti-plastic laws changed the ways we used plastic bags and straws seemingly overnight. Companies that produced these plastic products needed to sustainably adapt in order to hold onto the market and their profits.

Why Businesses Should Care About Habitat Destruction

Companies face turnover from something that seems out of their control. At first glance, a raging forest fire burning down an employee's house does not seem to be the responsibility of the company. However, when the employee relocates and seeks new employment in a new city, the company suffers and must retrain a new staff member.

When businesses care about habitat destruction and source raw goods from more sustainable sources, like bamboo instead of wood, employees and CEOs benefit.

Bamboo toothbrushes have seen a steady increase in sales, showing that consumers are increasingly interested in purchasing sustainably sourced products.

5. Overpopulation

Overpopulation means the number of people on the planet or given environment outnumbers the resources available to sustain that population.

Overpopulation contributes to pollution and climate change, improper waste disposal, habitat destruction, and the depletion of resources.

How Overpopulation Affects Business

These are the primary ways that overpopulation can affect business:

Loss of Employees

Overpopulation affects business because it correlates to lower education rates and low-income rates. Overpopulation reduces the talent pool of an educated and qualified workforce making it more difficult for companies to secure the employees they are looking for.

Loss of Profits

Overpopulation affects business profits because more people means higher inflation rates. As inflation rates rise, resources cost more which cuts into business profits.

Aerial view of a large crowd in Hong Kong.

Why Businesses Should Care About Overpopulation

Overpopulation is the main contributor to most of the environmental challenges we face today. Businesses have an impact on overpopulation that requires long-term thinking.

In the short-term, overpopulation means more market competition which is good for business. However, overpopulation has negative consequences on our environment and it reduces the quality of life for low-income families.

Businesses have an impact on overpopulation. Families in poverty have more children than higher-earning families. Livable wages contribute to education and medical care which in turn results in fewer children per family.

When a business invests in livable wages for their employees, they are investing in a higher quality of life and a more educated workforce for the future generation.

6. Improper Waste Disposal

Improper waste disposal is one of the top environmental issues in business. Due to overpopulation and improper waste disposal, we are polluting our land, water, and air.

Improper waste disposal is seen in nearly every product; from single-use plastic water bottles to fast fashion, to where we put animal feces from factory farms.

How Improper Waste Disposal Affects Business

These are the primary ways that improper waste disposal can affect business:

Loss of Profits

Improper waste disposal affects business profits because government policies are being put in place to keep companies financially accountable for their environmental effects.

For example, in 2020, Walgreens was fined USD 3.5-million for improper waste disposal.

Loss of Employees

Improper waste disposal has serious health consequences for employees and anyone living in areas surrounding production plants.

For example, farms that used dangerous chemicals in agricultural practices have now poisoned the drinking water of this California town. Relocation and sick leave reduce the workforce for businesses.

Why Businesses Should Properly Dispose of Waste

Improper waste disposal from one part of the planet can have long-term effects on the entire planet. A new study in 2022 found microplastics in human blood. Microplastics are associated with improper plastic disposal and have been found in rainwater.

Businesses produce a lot of waste and benefit from the continuous purchase of goods. Fast fashion is an example of a business model that has a responsibility to consider the end location of last season's fabrics.

For example, the jean brand Levi’s released a new line of jeans called WellThread which uses sustainable materials and no harmful chemicals.

Proper waste disposal will preserve our global freshwater sources from contaminants to keep employees and consumers healthy. Recycling practices will give us multiple uses of resources to preserve the raw goods we have so that production lines can continue meeting consumer needs.

A hand reaching up to touch green leaves.

The Bottom Line

Our planet faces environmental challenges that have direct and negative consequences on the longevity of current business practices.

Pollution, climate change, habitat destruction, overpopulation, depleting resources, and improper waste disposal all have cyclical effects on profits, employee turnover, and productivity. 

Businesses have the worldwide reach, the resources, and the technology to make scaleable changes to their procedures to reduce their impact on the environment. When businesses acknowledge and take responsibility for their large-scale environmental impact, the whole planet benefits.

Show the world how your company is creating a better business future with sustainable initiatives. Contact Prodigium Pictures to highlight your positive impact and show consumers that you care about sustainability issues.

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May 16, 2022
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