Question

Reporting on sustainability programs, policies and performance in the United States is presently voluntary. There appears to be two opposing views regarding voluntary sustainability reporting. One view is that voluntary sustainability reporting increases costs (communication and operational) and intensifies the likelihood that the reporting firm is greenwashing. A second view is that voluntary sustainability reporting demonstrates good corporate citizenship and environmental stewardship. Discuss whether or not an organization should adopt a proactive versus reactive stance to sustainability reporting.

Answer 1

Answer :

Proactive environmental business practices lead to better environmental performance, while reactive environmental business activities are correlated with lower environmental performance. There will certainly be a pragmatic approach to corporate environmental management reactive corporate environmental practices prioritize compliance with environmental laws and the introduction of environmental measures, such as end-of-pipe solutions, at a minimum level.On the other hand, proactive corporate environmental practices go beyond compliance by emphasizing corporate pollution prevention activities, higher-order learning and the redesign of existing processes. Reactive environmental practices with regard to the natural environment do not require expertise or skills in dealing with new environmental technologies or processes, whereas proactive environmental practices with regard to the natural environment are closely linked to the development of organizational capacities and resources which may be 'potential sources of competitive advantage' and which afflict the natural environment.

Stakeholders will put pressure on companies to implement sustainable environmental practices that boost their performance. This increased performance will increase the internal productivity and external credibility of organizations which, in effect, will contribute to competitive advantage and wealth creation. Yes, Businesses should take a proactive versus reactive approach to sustainability reporting. A proactive approach, as opposed to a reactive one, includes planning in anticipation of a potential situation instead of merely reacting to a situation. Proactivity involves initiating change inside the organization.A proactive strategy involves addressing a problem as soon as you know it, whether in your own organization or from a rival. Constructive environmental practices are intangible management technologies and procedures that involve organizational efforts to enhance the natural environment. Companies take either proactive or reactive actions in response to incidents. A business that takes a proactive approach , for example, should recall a defective product line rather than waiting for consumers to complain and deal with the problem down the road. Proactivity is a significant practice for companies to cultivate and allows businesses to follow a strategic decision-making strategy.Reactive conduct leads to loss of business and having to work much harder to get new business or restore damaged customer relationships. A proactive approach often requires both foreknowledge and imagination. Knowing trends in the market and paying attention to competitiveness concerns has helped businesses develop a constructive stance. Being reactive, particularly when another organization has set an example of what not to do, imply that you don't want to tackle the issue to the public and potential customers.Results from simultaneous and time-lagged models disaggregate provide limited evidence that toxic releases are positively linked to reactive environmental practices while toxic releases are negatively related to constructive environmental practices.They create trust amongst customers when businesses take a proactive stance. This maintains the company's good image of working hard to develop and retains customers that the business invests time and money to gain. Once positive approach strategies are embraced, it is easier to retain clients and attract new ones.