New rules, new plays in the changing game of business Batten Briefings, Spring 2006

Resumen

Across the industrialized world, the public has become increasingly alarmed by the many destructive ecological and social consequences of business activities, such as the contamination of water and food from hazardous waste and the overuse of poisonous insecticides and herbicides. The initial business response was generally negative; however, companies began to change their behavior. Increasingly, the value of a company and even its sur- vival may depend on its intangible assets, such as brand reputation, the capacity to innovate, and the ability to attract and keep the best people. These assets are all affected—positively or negatively—by the way a company handles the social and environmental dynamics of its activities. Through their business practices, corporations help establish the rules by which other companies will eventually be judged. In other words, evolving commercial practice becomes one of the key standards by which companies are judged in court. The growing integration of environmental and social factors indicates that leading companies are not waiting for a legal rule or legislation to define sustainability and corporate responsibility.