3. Ethical Aspects of Environmental Strategy

The management’s green commitment focuses on two aspects: eco-efficiency and eco-effectiveness. The former is the firm’s capacity to deliver competitive goods and services while reducing the environmental impact (i.e. material intensity, energy consumption, toxic dispersion) and engaging in cleaner production (i.e. renewable resources, material durability, recyclability of components, and longer lifespan of products). Eco-effectiveness is the capacity to provide green products and services through the integration of environmental strategy at the business level. Environmental commitment is not an exclusive attribute of top management. Consequently, the goal of proactive strategies is to create a greater sense of social and ecological responsibility within the firm. Environmental leadership relies on green attributes as a source of competitive advantage. If a company wishes to make environmental protection a priority, it should hire managers who act as green champions and who react positively to stakeholders that support environmental values. A proactive environmental strategy is codified in mission statements, formal policies, procedures, training programs, eco-labels, supplier guidelines, and sustainability reports. Formal and informal environmental values are disseminated across departments and functions, further contributing to the implementation of environmental strategies. A green reputation, external awards and recognition, positive product reviews, and environmental certifications are expected to increase employee satisfaction and pride, supporting green innovation and entrepreneurship. Conversely, greenwashing is an attempt to create a false impression of proactive environmental leadership. Greenwashing generates consumer cynicism and affects brand image for an extended period because it misleads consumers and the public about the presumed environmental benefits of products and services. Green marketing promotes the environmental features of the company’s products and services. These attributes refer to the design, production, packaging, delivery, labelling, use, repair, and disposal of products. Green marketing is responsible for the pricing, promotion, and distribution of eco-friendly products that incorporate radical or incremental innovations. Marketers make claims about product attributes, and about the policies and systems on which the production processes are based. Environmental marketing responds not only to the demands of customers but also to the ecological concerns of regulators and society. Consumer education regarding environmental conservation will strengthen the market positioning of green products and will enhance the company’s reputation.