Beyond eco‐efficiency: Towards socially sustainable business

Abstract An earlier version of this paper was presented by Dr Gladwin at the First Annual Senior Executives' Seminar on ‘Sustainability and Profitability: Conflict or Convergence’ sponsored by the HRH the Prince of Wales's Business & the Environment Programme and developed by the University of Cambridge Programme for Industry, Cambridge, UK, September 1994. The authors express their appreciation to AT&T, the Energy Foundation, the Management Institute for Environment and Business and the Merck Family Fund for their support of ‘The Global Environment Program’ at New York University, which partially financed preparation of this paper. The viewpoints herein should be attributed only to the authors. Sustainability, in most corporate gatherings and initiatives, has been conceptualized as something mainly having to do with eco‐efficiency, involving pollution prevention and resource conservation in the Northern Hemisphere. It is asserted here that eco‐efficiency is a necessary, but not sufficient, prerequisite for full sustainable development. Socio‐economic sustainability – involving poverty alleviation, population stabilization, female empowerment, employment creation, human rights observance and opportunity redistribution on a massive scale – is equally important, although perhaps infinitely more intractable. Although calls for corporate engagement in progressive social change have often been resisted in the past, we argue that the somber social state of the world, diminished governmental capacities and enlightened corporate self‐interest demand that private enterprise must now assume greater responsibility for human development on a global scale. After reviewing a broad array of indicators and origins of social unsustainability a set of working principles of socially sustainable business is proposed. A concluding section pinpoints the tasks of transformational leadership needed for redirecting corporations to the cause of ensuring a sustainable future.