GREEN BUSINESS

What is Green Business?

Green Business is also known as Sustainable Business. It is an enterprise that has
minimal negative impact or potentially a positive effect on the global or local
environment, community, society, or economy.
In general, business is described as green if it matches the following four criteria.
1. It incorporates principles of sustainability into each of its business decisions.
2. It supplies environmentally friendly  products or services that replaces demand
for non green products and/or services.
3. It is greener than traditional competition.
4. It has made an enduring commitment to environmental principles in its
business operations.

Benefits of Green Business –

Going green is not only good for the environment. It can also be good for business.
Establishing more eco-friendly practices can offer a number of commercially wise
advantages, from bottom-line cost savings to an outstanding market advantage.
Consider these ten benefits of going green, and see how efforts toward sustainability
can help boost business.
#1 Reduce Waste and Decrease Costs
By reducing your energy usage, you’ll ultimately save on resources and associated
costs which will improve the overall quality of your business operations. Try turning
off unneeded lights at the office to reduce monthly bills and printing on both sides to
save on paper expenses.

#2 Earn Eco-friendly Incentives and Rebates

Earn special rebates and incentives  for your green efforts. In 2009, the federal
government established a stimulus plan to encourage businesses to go green by
providing incentives through tax credits. From federal tax credits for energy
efficiency to incentives from energy companies and other corporations, there are a
number of avenues to help you save while going “green .”

#3 Attract “Green” Customers

Tailoring your brand to fit within sustainable ideals is a smart way to attract eco-
conscious consumers. This new economy of “green” consumers creates boundless
opportunities for innovation and authenticity. Studies show that businesses who
regard the environment garner higher consumer attraction and lasting loyalty .

#4 Improve Your Brand Image

Improve your company’s reputation and brand image with your green approach to
business. People love organisations that care, and a polished public image  will mean
more success for your company.

#5 Increase Sales Through Innovation

Create new products that are innovative and environmentally friendly to increase
sales and profits. Patagonia’s footprint chronicle is a great example of how a business
used its environmental ethic to examine its business habits and provide customers
with genuine transparency. Savvy consumers like to know where their purchasing
power is being invested, so get creative in how you approach your company’s ethic
of sustainability.

#6 Avoid Added Costs

Every year, new legislation raises the standards for corporations and businesses to be
more sustainable in their operations. Being proactive in establishing a “green”
business will not only help improve your brand image and attract the ever-growing
market of environmentally minded consumers, it will also help you avoid the added
costs that accompany unsustainable and wasteful habits.

#7 Promote a Healthier, Safer Workplace

Establishing your company’s sustainability goals  will help achieve efficient
operations, be more innovative in your work, improve lives and enrich your local
community. By striving for collaboration, you will take into account environmental
and social challenges that will ultimately help your business become a force for good.
You may even want to consider establishing a rewards program for employees who
demonstrate sustainable lifestyle choices such as biking to work .

#8 Establish Community Relationships

Building corporate responsibility and ethical leadership into business plans can help
establish vital community relationships and strengthen local bonds. Take, for
instance, Panera’s initiation of pan-era cares, a pay-what-you-can community cafe
concept to help serve the poor. Reaching out to those in need in your local
community will improve your image, ensure your employees can trust their work
establishment and ultimately make your part of the world a better place .

#9 Increase Productivity
Even minuscule improvements in efficiency can improve the overall productivity of
business operations, and ultimately result in enormous savings. If you operate a large
fleet of vehicles, initiate hyper-efficient business ideas  similar to those adopted by
U.P.S. in regards to their packaging and sorting of cargo, mapping out of delivery
routes and limitation on the number of left-hand turns drivers could make to avoid
idling engines and wasted time. The company was able to shave cut nearly 30 million
miles off delivery routes within the span of one year, resulting in savings of almost
three million gallons of gas and 31,000 metric tons of CO2 emissions .
#10 Reduced Costs With Efficient Technology
There are a number of efficient technology alternatives that will help you reduce
energy usage at work and save you in monthly bills. Consider installing a Nest
Thermostat to fit your unique workplace needs and avoid driving up energy costs.
For exit signs, use LED rather than incandescent or fluorescent bulbs, and install
occupancy sensors for lighting. Also, be sure to replace your HVAC filters to save
energy and prolong your system’s lifespan. Stay up-to-date on all the latest eco
friendly gadgets...

Automotive Industry
All those companies and activities involved in the manufacture of motor
vehicles, including most components, such as engines and bodies, but
excluding tires, batteries, and fuel. The industry’s principal products are
passenger automobiles and light trucks, including pickups, vans, and sport
utility vehicles. Commercial vehicles (i.e., delivery trucks and large transport
trucks, often called semis), though important to the industry, are secondary.
The history of the automobile industry, though brief compared with that of
many other industries, has exceptional interest because of its effects on history
from the 20th century. Although the automobile originated in Europe in the
late 19th century, the united states completely dominated the world industry for
the first half of the 20th century through the invention of mass
production techniques. In the second half of the century the situation altered
sharply as western European countries and Japan became major producers and
exporters.

The development of Automotive Industries

Estimates show that the automotive industry is responsible for 15% of total global
carbon emissions, or about eight billion metric tons per year. In recent years,
however, the auto industry has taken great strides toward reducing its carbon
footprint through new technology, including greater fuel efficiency, alternative fuels,
and zero emission vehicles. 

Concerns over the environment and climate change lie at the heart of the move
toward more green cars. After all, we’ve all become more aware about how cars
contribute to global warming, climate change, and the destruction of our ozone
layer. Those environmental concerns have spurred governments to pass more
stringent regulations regarding fuel economy and greenhouse gas emissions, and
have increased consumer demand for more environmentally-friendly vehicles.

How Automotive Industries are meeting the demand

To meet both the regulatory and consumer demands, automakers are heading down
three paths:

•Increasing efficiency — Engines generate energy, and in most cars, a tremendous

amount of that energy gets lost as heat from friction, instead of being used to propel a
car. The goal here, then, is to produce more efficient engines that can eke out more
miles from every gallon of gas. And cars are definitely performing better at using fuel
efficiently and posting higher EPA ratings.

•Electrifying everything — Petroleum-electric hybrid cars are everywhere, and thanks

to technological advances, they’re becoming more efficient and posting higher gas
mileage numbers.

•Exploring alternative sources of energy — This can be anything from plug-in electric
vehicles, to hydrogen fuel cell cars, to perhaps solar-powered vehicles (more on that
later). The idea is to reduce our reliance on petroleum, which is both politically
charged and environmentally unsustainable.

Legal Environment and Business Laws related to Green Business

Legal environment is a set of legal aspects as follows: 1) law and regulations

that influence business activity on the market (e.g. companies law, competition
law) and within an organisation (e.g. labour law, accounting and tax law); 2)
provisions of the Constitution (general rules and principles that the government
in the name of all society considers as the most important and worth to
implement and enforce; also rights and duties in related to citizens); 3) justice
activity (especially activity of civil justice, as the courts investigate cases that
are either related to trade or directly affect business). It may be stated that the
rule of law connects all the above-mentioned legal aspects of businesses
activity.

When concerning the rule of law principle it is always a question of material

and formal guaranties properly functioning in a state. Formal guaranties, in
other words institutional, are considered as mechanisms for monitoring
compliance with the law by the state in the course of its regulation and
application. It means that the government and its institutions ought to make
decisions in accordance with the valid law and in a manner determined by the
law. Material guaranties correspond to economy (e.g. economic system,
economic development) and social factors adequate to the society within the
state borders. It may be stated that material guaranties are like
 the muscles, tissue, and blood vessels on a skeleton made of formal guaranties.
Some features are given and it is hard to change them in a short perspective, but
it is crucial to follow the direction that will continuously shape the state’s
condition. In a state where the rule of law is of high quality, the basic premises
of law include: separation of powers, constitutionalism, legality, primacy of the
law, prohibition of retroactivity, allowing interference with liberty and property
units exclusively on the basis of statutory authorisation, judicial review of
executive actions, and liability for damage done by the state or its officials. In
other words, the state ought to manage in accordance with the law, with respect
to the principle that the law is above the state, that the law establishes guidelines
of the state and the society’s actions.

The legal environment can be also considered in an international dimension. All

national legislators are confronted with a global legal environment in which
authoritative rule-making, rule enforcement, and processes of dispute resolution
occur. In the definition presented by Shavana Musa and Eefje de Volder the
global legal environment refers to a multi-layered phenomenon which includes
all mechanisms of authoritative rule-making, rule enforcement, and dispute
resolution that transcend national borders. It emerges out of the actions of both
public and private legal actors, the ideas and research of legal scholars, and the
initiatives and actions of international institutions. Even though national
legislators’ behaviour influences the global legal environment, it emerges to a
large extent without being directed (Musa & de Volder, 2013).

The legal environment is permanently changing. The rate of changes is not

comparable to other environmental areas, but still it is possible to mark changes
and observe the influence on other aspects. For ages states either by unions and
organisations or by force have been creating new legal perspectives for its
citizens. Nowadays, not much has changed. New organisations are created,
especially those with an economic nature have a considerable impact on
business life among states that are part of the organisation. For instance
European Union legislation affects more and more areas of business. At the
beginning of its existence it started with steel, coal, and atom energy
regulations. Now the EU can state that a carrot is a fruit or a snail is a fish and it
can also forbid product and service discrimination by discriminating other
products or services (C-120/78, Cassis de Dijon).

The rule of law concept functions as a complex, multi-component historical

idea with a large rhetorical power. Its fundamental mean- ing corresponds to the
postulate of stable law which is known by its recipients even before its
implementation. In this sense, the rule of law is distinguished by the following
features: 1) it protects against anarchy; 2) it allows people to organise their
affairs and interests with reasonable certainty, that they can plan in advance the
legal consequences of their actions; 3) it protects against at least some
manifestations of official arbitrariness. It may be stated that the rule of law
principle works when: 1) citizens are able to understand the law and observance
rules; 2) the law should be effective and efficient; 3) legal institutions are more
important than discretionary decisions; 4) adjudication in matters of impartial
and non-party judges

The importance of a companies legal environment

The legal environment is an important part of the reality in which entrepreneurs

operate. Like any other environment, it is also complex, variable, and diverse.
Many additional forces affect its shape and impact. The forces are shaped by
internal conditions – economic, political or social as well as external. The
external conditions relate to the country’s geopolitical situation, its role and
importance in the international arena, and its involvement in international
economic and political organisations. The wide spectrum of impact causes the
legal environment to be more turbulent than it would be expected by
entrepreneurs, forcing them to change and adapt, which does not always seem to
be in line with the logic of market functioning. The ability to create reasonable,
coherent, and rational law promotes the entrepreneurship development. At the
same time an efficient state creates conditions for a stable and effective market
exchange.

The rule of law establishes standards that people among a given society must
follow to avoid being penalised. The rule of law not only allows people to
understand what is expected of them in their personal capacities but also sets
forth rules for businesses, so they also know what is and what is not expected
while making dealings and transactions . In addition, it restrains government
and others from infringing property rights. Whereas disputes arise, the set of
rule of law factors provide a direction and means of the solution. It provides
guidance and direction in every area of business. For example, it ensures means
to bring a complaint against another party to a neutral decision maker, so that a
decision can be made regarding the dispute. Because of a given rule of law
system, entities know that they are permitted. Or they can try an alternative
method of dispute resolution if they do not wish to engage in litigation. This
expectation is reasonable only because of the rule of law (Lau & Johnson,
2014).

It was pointed out that “the rule of law sometimes plays as a Trojan horse to
import other political goals such as democracy, human rights, and specific
economic policies” . The rule of law also provides protection for property,
which is especially important in reference to business and considers protection
for intangible property, such as intellectual property – trade secrets, trademarks,
or

copyrights. People would not have the incentive to create or share new
intellectual property if they had no reasonable expectation of being able to
protect it. And it is also a question of protecting this kind of property by a
business by itself having no measures and possibilities to check signals of
improper intellectual property usage. Businesses also rely on the rule of law to
govern their debtor and creditor relationships (for instance in case of
bankruptcy). The rule of law also protects people from businesses’ adverse
effects. Antitrust legislation is an example that prevents certain anti-competitive
practices, such as colluding and price fixing. Additionally, businesses are
prohibited from using deceptive advertising and are held responsible when they
manufacture or sell defective products that may cause an injury. The rule of law
also protects businesses from the government. Since everyone is subject to the
law, even government itself may not overextend its reach when regulating or
investigating businesses. Moreover, without a rule of law system, people would
have to physically protect their own property. This would lead to a breakdown
in the social structure, and it would result in vigilante justice and physical
strength playing primary roles in dispute resolution (Lau & Johnson, 2014). It
should be noted that the invoked authors presents an idealistic concept of the
principle. They describe how the rule of law works in absence of disruptive
factors.

A solid understanding of the legal environment can help to avoid liability or at

least minimise the risk. For instance marketers must be particularly aware of
tort law, consumer protection law, and intellectual property law to avoid
charges of libel, those in advertising need to take care not to defame another
person, company, or product. It might be tempting to do so, especially if a
company was engaged in serious competition with another company that sell a
similar product. Additionally, marketers must be aware of other people’s
intellectual property rights to avoid copyright or trademark infringement in their
own work product (Lau & Johnson, 2014).

The main factors and forces occurring and affecting a company should be
analysed and conveyed to opportunities in the future. This approach includes
risk analysis. In economics theory, risk is usually defined along with the notion
of uncertainty to indicate the significant difference between the two concepts.
Uncertainty is not measurable. Some more or less expected events or
occurrences might be described but without a possibility of their probability
value. Unlike uncertainty, the value of risk can be estimated. Frank H. Knight
pointed out that
 “in physics, the model and archetype of an exact science of nature, a relatively
small and workable number of laws or principles tell us what would happen if
simplified conditions be assumed and all disturbing factors eliminated” (Knight,
1957, p. 4). Economics is not so successful because of the lack of an explicit
and clear description of market forces’ shifts. General models are developed and
described. On their basis other, similar structures are explained with more or
less success.

There are some concepts of risk division which consider: market, credit,
operating, and legal risk. The last one is in the course of interest of this paper as
it strongly associated with the legal environment where a company operates. Its
scope is dependent on various external factors and the internal activities of the
company. Legal risks may occur in: regulatory instability or changes in
jurisdiction lines; erroneous configuration of legal relations; failure or improper
use of the law in the organisation; unfavourable decisions of litigation for the
organisation. Legal risk is not defined in Polish law or in the EU legislation, its
definition is based on the definition of operational risk. The concept is broad
and covers the process of law issues’ regulation, implementation, and
compliance. Therefore, the following types of legal risk may be identified: the
risk of over-regulation related to a particular section of social or economic life –
limiting economic freedom; the risk of insufficient regulation of the area of
socio-economic development – leaving loopholes; the risk of non-applicability
in practice related to certain legal regulations; the risk of difficulties in law
enforcement. For example the G30 defines legal risk as “the risk of loss because
a contract cannot be enforced. This includes risks arising from insufficient
documentation, insufficient capacity or authority of a counter-party (ultra vires),
uncertain legality, and unenforceability in bankruptcy or insolvency” . The
Basle Committee indicates that legal risk occurs when:

1) the existing laws may fail to resolve the legal issues involving a company;

2) a court case involving a particular company may have wider implications for
business and involve costs to it and many other companies;

3) laws affecting commercial enterprises may change, especially when entering

new types of transactions and when the legal right of a counter-party to enter
into a transaction is not established.