Business and nature

With varying extent, business organisations have been paying attention to environmental issues from the 1960s onwards following the publication of Rachel Carson’s seminal book about the detrimental effects on pesticides on the environment (Carson, 1962). In the late 1980s, environmental management in organisations started to shift from a reactive to a more strategic, proactive stance (Clarke & Roome, 1999). In the 1990s environmental issues started to gain substantial attention, in particularly subsequent to such events as the 1992 Rio de Janeiro United Nations Conference on Environment and Development (UNCED), also known as Earth Summit (Etzion, 2007; Laine, 2010a). Already at the 1992 conference, climate change was at the centre of attention, as the United Nations Framework Convention on Climate Change (UNFCCC, FCCC) called for countries to begin to monitor and report their emissions (Levy, 1997). Further discussions and Conference of the Parties (COP) meetings lead to setting binding emissions targets for developed countries and the Kyoto Protocol being signed in 1997.

Fundamentally, business organisations are physically inseparable from the natural environment surrounding them. Essentially, all humans and organisations are composed of the natural environment and would not exist and could not survive without the rest of the natural environment (Driscoll & Starik, 2004; Winn

& Pogutz, 2013). In addition, virtually all business decisions have an impact on the environment, even though the organisation might be unaware of these impacts (Etzion, 2007). The natural environment-business relationships have been extensively examined in various disciplines using their respective theories, resulting an incohesive body of academic literature on organisations and the natural environment (Etzion, 2007; Kallio, 2004). Banerjee (2001, pp. 490–491) has presented that there are two areas of research incorporating the biophysical

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environment into organisation theory. First, the interdisciplinary area discusses the implications of including the dynamics of the biophysical environment into traditional economic and management paradigms in order to overcome the anthropocentric bias in organisation theory. This area of research discusses paradigms, such as the ‘ecocentric’ and the ‘sustaincentric’ paradigms that are contradictory to the neoclassical economic paradigm.

The second area focuses on the strategic implications of environmental issues for organisations and on environmental management strategies (Banerjee, 2001, pp.

490–491). Environmental management aims to identify and manage actions to reduce the environmental impacts of an organisation utilising environmental management practices to improve a company’s competitiveness (Bansal, 2005;

Darnall, Henriques, & Sadorsky, 2008; Jones, 2013; Onkila, 2009, 2011). Similarly, the related concepts of ‘corporate environmentalism’, ‘ecological sustainability’ and

‘ecological modernisation’ suggest that by becoming or being ‘green’, companies can simultaneously achieve economic goals, reduce costs, open new market opportunities and improve the environment (Eden, 1999; Hajer, 1995; Kallio, 2004; Nyberg & Wright, 2012). Even though these streams of research have been developing for the past decades, scholars have argued that the aim of infusing management and organisations theory with biophysical foundations has so far remained underdeveloped (Kallio, 2004; Starik & Kanashiro, 2013).

Kallio (2004) presented a theoretical study of corporate greening and a critical overview of the field of organisational environmental studies. Kallio (2004) concluded that organisational environmental studies have concentrated on studying corporate greening from the business perspective, while the other side of the greening process and the business-nature relationship - nature - has been largely ignored. He suggested that the interaction between social and natural sciences must be enforced to solve environmental problems.

Marcus, Kurucz, and Colbert (2010) have analysed the conceptions of business-society-nature relationship in management literature. They presented three general conceptions: the disparate, intertwined and embedded views. The disparate view regards society and nature as separable from and peripheral to the business system, thus presenting an externalising perspective. The intertwined view provides a relating perspective where society and nature are regarded as important and integrated to the business system. The embedded view maintains the main principle of the intertwined view suggesting that business, society and nature are innately intertwined. The embedded view presents that they are not only interrelated but nested systems. In the embedded view, nature as a finite and an

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encompassing life-sustaining system provides the foundation for both society and business. Business exists within the society and likewise society is completely nested within the natural environment. Thus, the embedded view presents a reorganising perspective of the conceptions of business-society-nature interface.

The alternate conceptions of business-society-nature interface are illustrated in figure 1 (adapted from Marcus et al., 2010, p. 406).

Marcus et al. (2010) noted that the integrated view is mostly used by environmental management and sustainability scholars, and it is in line with the widely used triple-bottom-line model (Elkington, 1998). The embedded view is the most recent view and Marcus et al. (2010) suggested that it would be the most useful in addressing complex global sustainability problems.

The business-nature relationship has received considerable attention also in the stakeholder literature. The status of nature as a stakeholder is debated and currently has a mixed status (e.g. Driscoll & Starik, 2004; Freeman et al., 2010; Onkila, 2011;

Figure 1 Conceptions of the business-society-nature interface (adapted from Marcus et al. 2010).

Note. S = society, B = business, N = nature.

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Orts & Strudel, 2002; Phillips & Reichart, 2000: Starik 1994; 1995; Stead & Stead, 2000; for discussions see Haigh & Griffits, 2009; Laine, 2010a). The debate has predominantly focused on the question of how inclusive the scope of stakeholders should be (Haigh & Griffits, 2009). In the traditional models, as a non-human actor who does not have voiced claims or expectations, nature and the natural environment are not granted the stakeholder status. The natural environment is advocated by other stakeholders, mostly NGOs (non-governmental organisations) and activist groups. Driscoll and Starik (2004) have argued that the natural environment should be recognised as the primary and primordial stakeholder of the firm, as it has mutually dependent, exchange-based relationships with companies: companies depend on local and global ecosystems for resources and exchange more with the natural environment than with any other stakeholder.

Management research has been more focused on the impacts of organisations on the environment, while the natural environment’s impacts on organisations have been less examined (Winn & Kirchgeorg, 2005). However, climate change has been identified as an issue where the changes in the natural environment, such as the increasingly abnormal weather events and changes in the biodiversity, provide a potential risk for business operations (e.g. Busch & Hoffman, 2007; Linnenluecke

& Griffits, 2010, 2012; Winn, Kirchgeorg, Griffits, Linnenluecke, & Günther, 2011). Thus, in the case of climate change, it has been argued that climate change and the resulting changes in the natural environment meet Freeman’s (1984) ‘can affect or is affected by’ criterion of stakeholder and should therefore be considered as stakeholders (Starik, 1994, 1995; Kolk & Pinkse, 2007b). Further, Haigh and Griffits (2009) argued that the natural environment can be identified as a primary stakeholder when the potential strategic impacts of climate change are examined.

Haigh and Griffits (2009) have presented that recognising the natural environment as a primary stakeholder could help businesses to create opportunities for sustainable operations and to understand the strategic landscape better.

In sum, while previous literature has discussed alternative ways of including the natural environment in management and organisation studies, there are still no uniform conceptions for doing this. Recent literature, however, more and more sees the natural environment as the most crucial issue for the well-being and survival of organisations. Especially understanding of the natural environment-business relationships is vital for conceptualising sustainability challenges.

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