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Transformative businesssustainability

Multi-layer model and networkof e-footprint sources

Goran SvenssonOslo School of Management, Oslo, Norway, and

Beverly WagnerUniversity of Strathclyde, Glasgow, UK

Abstract

Purpose The purpose of this paper is to describe the concept of transformative businesssustainability. Business sustainability refers the total effort of a company including its demandand supply chain network to reduce the impact on the Earths life- and eco-systems , i.e. the totale-footprint. Transformative highlights the need for an open minded, dynamic and flexible approachto business sustainability not governed by blinkers.

Design/methodology/approach This paper discusses a conceptual development oftransformative business sustainability, derived from a frame of reference. The essence is theintroduction of a multi-layer model of units (i.e. different businesses or other stakeholders), a networkof e-footprint sources and a recovery pool and redistribution buffer at the interface.

Findings Transformative business sustainability is both a theoretical and managerial concept.It could also be seen as a roadmap to plan, implement and evaluate business sustainability.

Research limitations/implications Transformative business sustainability providesopportunities for development. Suggestions for further research are presented.

Practical implications E-footprint sources in business, applying an Earth-to-Earth approach, aredescribed. The concept of transformative business sustainability contributes by achieving genuineand continuous business sustainability and awareness at strategic, tactical and operative levels ofbusiness, avoiding use of buzzwords and window dressing.

Originality/value Well-being of the planet Earth has to be at the core of business sustainability.The authors contend that the recovery pool and redistribution buffer is crucial in the planning,implementation and evaluation of transformative business sustainability.

Keywords Transformative, Business, Sustainability, Earth-to-Earth approach, E-footprint,Recovery pool, Redistribution buffer, Environmental management, Ecosystems

Paper type Conceptual paper

IntroductionWe contend that the quest for zero-sum cycles in business should start and end at theplanet Earth. Docherty et al. (2002, p. 11, cited in Backstrom, 2009) write that the coreconcept of sustainable systems is that resources deployed are regenerated by the system.Thus, with the increasing demands on businesses to be environmentally responsible,for example with regards to procurement, production, distribution and the market,means that companies allocate sufficient resources that enable them to undertakeappropriate efforts to reduce, not only their own carbon footprints (i.e. carbon dioxideequivalent) of business (Fearne, 2009), but also the total Earth-footprint that we label

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0955-534X.htm

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Received September 2010Revised November 2010Accepted March 2011

European Business Review

Vol. 23 No. 4, 2011

pp. 334-352

q Emerald Group Publishing Limited

0955-534X

DOI 10.1108/09555341111145735


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as business sustainability, which we subsequently refer to the total effort of acompany including its demand and supply chain network to reduce the impact onthe Earths life- and eco-systems , i.e. the total e-footprint.

The e-footprint is not only about or limited to the carbon footprint, but the use of, for

example, toxic substances, non-renewable sources or other sources having an impact onEarths life- and eco-systems. We also contend later on in this paper that businesssustainability should be transformative, which stresses the need and importance for anopen minded, dynamic and flexible approach to business sustainability not governedby presumptions from previous theory or existing models in literature, because toomuch is at stake regarding our planet Earth. It would be meaningless and potentially afatal mistake to adapt empirical observations and data to existing theories and models,instead of the opposite.

The business impact on Earth is nothing new, but it is only in the last part of thetwentieth century that the collective impact of societys activities has reached a globalscale (Ehrlich and Ehrlich, 1987). There is now recognition that economic activity cannotbe sustained independent of the functions and systems provided by the biophysicalworld (OHara, 1998).

There have been few genuine attempts focusing on Earth-to-Earth (EE) approachesin business research (Wagner and Svensson, 2010, 2011) and business practices(Cambra-Fierro and Ruiz-Bentez, 2011; Hgevold, 2011; Santos, 2011; Svensson andWagner, 2011a, b). The business impact on Earths life- and eco-systems (i.e. thee-footprint) is examined to a greater extent, though it still often addressed in narrowterms (e.g. as done in recent special issues on sustainability). We intend to try to fillthese gaps by describing business sustainability based upon teleology in complexitysciences (Stacey et al., 2000), which is explained and justified in the next section.

Teleology in business sustainabilityStacey et al. (2000, p. 14) introduced a framework based upon the teleological cause,where teleology means:

. movement into the future believed to be either towards a known or an unknowncondition (i.e. predictable or unpredictable); and

. the reason for the movement of a phenomenon into the future is in order toachieve some optimal arrangement, i.e. a chosen goal.

The following approaches of teleology in their framework are potentially relevant foruse in business sustainability, namely:

. formative;

.

rationalist; and. transformative.

Formative teleologyFormative teleology refers to stable movement produced by the self-organizinginteraction of parts where the final state is pre-determined (i.e. known and predictable)and efforts to create business sustainability move towards this state as shown inFigure 1. Movement of time and of meaning is from a given past to the present.

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The future of business sustainability recognized from the past, will subsequently be arepetition of the past.

In other words, in the context of formative teleology, although one has a notion offuture efforts of business sustainability based upon the present, the assumptions made

are based upon the past. Using formative teleology, business sustainability becomespre-determined and directed towards a known and predictable future condition.We conclude that business sustainability is hardly formative as there is no evidentfuture. The current state is more like trial and error and should not be based upon thepast, as it would limit open minded, dynamic and flexible planning, implementationand evaluation of business sustainability efforts.

Rationalist teleologyRationalist teleology considers the notion of self-organization as absent, and regardsboth stability and change as directed choices towards an autonomously chosen goal.What happens in this case is that the efforts to achieve of business sustainability fulfillthe selected goal for a known and predictable future as shown in Figure 2. Business

sustainability thus becomes about filling the gap between the future goal and whatexists in the present.

The movement of time can be said to be from the future to the present. In other words,the meaning is located in the future, and the relevance of the present is primarily that itpoints to the future. Future efforts of business sustainability are determined andoutlined in the present. Business sustainability becomes goal directed towards a knownand predictable future condition. As in the formative teleology, we contend that therationalist teleology is inappropriate as it restricts the open mindedness, dynamics andflexibility of planning, implementation and evaluation of efforts towards businesssustainability. It may indeed push in thewrong direction as we cannot know thefuture ofbusiness sustainability and may be missing yet unrealized future solutions and actions.

Transformative teleologyTransformative teleology presumes a self-organization and a transformative causationof micro interactions, continuously influenced by previous efforts towards businesssustainability. Each such moment is a repetition of the past, but with the potential forfuture transformation and continuity at the same time (i.e. towards an unknown andunpredictable future) as shown in Figure 3.

In other words, one effort of business sustainability leads to another, but withthe potential of continuous adaptation. When transformative teleology is employed

Figure 2.Rationalist teleology inbusinesssustainability (BS) Past (BS) Present (BS) Future (BS)

Figure 1.Formative teleology inbusinesssustainability (BS) Past (BS) Present (BS) Future (BS)

Figure 3.Transformativeteleology inbusiness sustainability (BS) Past (BS) Present (BS) Future (BS)

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one is bound to find co-creative interaction between efforts of business sustainabilitywhich become variable and continuous aimed towards an unknown and unpredictablefuture condition. However, notions of how the future condition might be derived fromthe interactions continually taking place in the marketplace and society itself. We

contend that applying transformative teleology makes a valuable and importantcontribution in achieving open minded, dynamic and flexible planning, implementingand evaluating efforts of business sustainability. Furthermore, it contributes to anincreased understanding of business sustainability. Thus, we coined the phrasetransformative business sustainability.

Research objectiveWe believe transformative business sustainability may be both a theoretical conceptand managerial roadmap to plan, implement and evaluate business sustainability.

The objective is to describe this concept of transformative business sustainability.Principally, it consists of a multi-layer model of units (i.e. different businesses or other

stakeholders) and a network of e-footprint sources. The frame of reference is derivedfrom a combination of literature review, conceptual frameworks (Wagner andSvensson, 2010, 2011) and case studies of corporate efforts to achieve businesssustainability (Cambra-Fierro and Ruiz-Bentez, 2011; Hgevold, 2011; Santos, 2011;Svensson and Wagner, 2011a, b).

The rest of the article is structured as follows:

. a frame of reference supporting the concept of transformative businesssustainability is described;

. the concept of transformative business sustainability is outlined and discussedincluding a brief empirical illustration;

. implications and lessons learned are provided; and finally

.

conclusions are drawn and suggestions for further research are offered.

Frame of reference and conceptual developmentThe frame of reference that follows in this section and the underlying paragraphs aresynthesised, and its structure shown, in Figures 4 and 5. Further details and discussionregarding the logic and interpretation of these figures are provided in the next section.

EarthThe first e-footprint source in Figure 5 is Earth. Ehrlich and Ehrlich (1987, p. 15) writethat from a galactic perspective, Earth is hardly impressive. On the contrary, Earth isan inconceivably insignificant planet in the universe, but as they conclude, it is all wehave. As far back as 1988, Campbell (1988, p. 76 cited in Stead and Stead, 1994) notes

that desire for economic wealth continues to reign in the world of mankind despiteEarths has limited resources and interdependence of life systems as well as thedelicate balance of ecosystems.

Mankind is not only exploiting the non-renewable natural resources on Earth at apace that is non-sustainable, but he is also having a negative impact on the climate(IPCC WGI Fourth Assessment Report, 2007) and the natural environment,consisting of life- and eco-systems. In an era when business sustainability has becomean issue in some corporate agendas, it is becoming overused and is a buzzword


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(often misused and to not say abused) by others. It is crucial in any corporate effort tocreate sustainable business models and cycles where the impact on our planet Earth isseriously addressed and minimized. If not, it cannot be seen as a genuine corporate

effort towards business sustainability.Stead and Stead (1994) argue that organisations in the twenty-first century will have

to change fundamental assumptions and values which underlie their relationships withthe global ecosystem. By this, they mean integrating ecological performance intostrategic planning, as well as at the operational level and undertaking regular marketresearch to capture changing consumer attitudes towards environmental issues,modifying performance and adopting new operating principles. They suggest thatan ecological sensitive economic and management paradigm is only achievable when

Figure 5.A networkof e-footprint sources

(ii)

Procurement

(iii)

Production

(iv)

Distribution(v)

Market

(vi)

Consumer

(i)

Earth

Recovery Pool and

redistribution

buffer

(surplus/residual)

Figure 4.A multi-layer model ofe-footprint sources

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the Earth is regarded the ultimate stakeholder and duly accounted for in theorganisational values, visions, strategies, structures and processes.

Companies must go through corporate self-greenewal a term coined byShrivastava (1992, p. 18) involving transformational processes and adjustment to

new market forces, realignment of products, systems and resources based upon a closerelationship with the natural environment. Stead and Stead (1994) emphasised this asthe ability to perceive the Earths limits, the physical interconnectedness between theorganisation and the ecosystem as well as the true long-term ecological implications oftheir strategic choices. Stead and Stead (1994, p. 27) proposed a corporate strategy thatsaw the Earth as a stakeholder in the economic system and management paradigmsincorporating the Earth into the decisions of the corporate leadership, had to provide aframework which included the Earths green representatives.

ProcurementThe e-footprint source of procurement in Figure 5 may be derived from internal and orexternal surpluses or residuals, all of which may have direct or indirect interconnections

to the planet Earth (i.e. the origin and ultimate e-footprint source). In other words, it maybe based upon natural resources or value-added ones brought into the demand andsupply chain network. They may be required for companies value-adding primary andor supportive activities (Porter, 1985). This is critical where corporate efforts to runsustainable business operations are, to a large extent, determined in terms of the unitszero-sum e-footprint cycles (i.e. a business having no impact on the natural environmenton Earth and using strictly recycled and/or renewable natural resources).

Procurement has direct and/or indirect connections on the planet Earth because it isbased upon natural, or value-added, resources that are brought into the business cyclerequired for value-adding primary and or support activities (Porter, 1985). This is acrucial phase where corporate efforts to run sustainable business operations can havean impact in terms of zero-sum cycle. The purchasing functions role in facilitatinginternally driven environmental activities such as re-use, re-cycling and sourcereduction is essential and the importance of supply chain risk management is evidenthere (Business in the Environment, 1992, cited in Lamming and Hampson, 1996):

Good purchasing will minimise the risk of breaks in the supply chain [ . . .] Since purchasedgoods and services represent the major proportion of total operating costs for manycompanies, and as quality, performance and design improvements become more important inmaximising value in products, there is an increasingly strong link between environmentalimprovements and quality, and therefore long-term profitability.

In order to achieve sustainable demand and supply chain networks, organisations needto take a much broader perspective and to demonstrate network custody whereenvironmental and social aspects extend beyond organisational boundaries (Carter and

Rogers, 2008). For procurement, this means reinforcing many activities that come underthe umbrella of supply management, such as supplier selection, supplier certification,supplier involvement, and supplier development. All of the foregoing require buyers towork harder at nurturing longer term relationships with key suppliers by implementingcross-function project teams and nurturing trust and commitment between businesspartners (Seuring and Muller, 2008). B&Q is a UK company addressing some of thesocial, environment and economic impacts through procurement and by implementing acode of conduct across its global supply base using Environmental Management


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ISO 14000 series standards. Clearly, the ongoing challenge is that such collaborativerelationships take time, resources and commitment to implement and develop.

The quest for sustainable procurement of demand and supply chain networks playsa vanguard role and many organisations have implemented codes of conduct that have

been incorporated into supplier contracts (Ciliberti et al., 2009). However, to ensurecompliance, buyers need to regularly monitor business partners. With the rise ofoutsourcing and the complexity of global demand and supply chain networks,monitoring has to involve visits to, and regular auditing of, business partners to ensurethey are operating in accordance with company requirements (see Mattel as anexample of what can happen if an organisation loses sight of its demand and supplychain network). The client company recognises the importance of closely collaboratingwith suppliers and it is essential that suppliers have the mind set, capabilities andresources to implement these codes of conduct (Wagner and Svensson, 2010).

Internally, within an organisation this impacts on the strategic positioning ofprocurement and emphasises the vital role of the buyer. Adding business sustainabilityto the agenda requires a substantial procurement team and in times of global economiccrisis, sustainable procurement must have a strategic role on the board of management.Buying decisions must be made from an empowered position supported by the boardand CEO. This has implications on the way business partners are rewarded and ifsustainable development is important, then rewarding business partners on the basis ofcost savings in not the way forward. Business partners should collaborate whendeveloping sustainable solutions, reducing carbon footprints and packaging andtransportation costs. Implementation of sustainable policies and practices can beexpensive; emphasis is needed to support the business partner in order to ensure thatbusiness viability is not unreasonably threatened.

Production

The e-footprint source of production in Figure 5 consists of both primary andsupportive activities. This is where sustainable or non-sustainable business operationsbecome evident and are made explicit. For example, what resources are used, are theyrenewable or not, are they recyclable or not? What is the short- and long-term impacton the planet? Furthermore, how are the inbound and outbound processes managed(e.g. storage of materials and inventory)?

Sustainable production necessitates changes in all production practices whichinclude design, engineering and operations that focus on environmental preservation(Hong et al., 2009). This poses challenges and opportunities for manufacturing firmsand manufacturing organisations can initiate change that advances innovation whilesimultaneously improving efficiency and business performance (Florida and Davison,2001, cited in Hong et al., 2009). However, organisations cannot undertake this task

alone and must look to other firms in the demand and supply chain network to supportchanges which clearly require early business partner involvement (Humphreys et al.,2005; Seuring and Muller, 2008, cited in Hong et al., 2009).

Introducing environmental quality systems into a firms processes is closelyassociated with total quality management (TQM), where process changes often requireorganisational cultural change. TQM deals with quality at every stage of the productionprocess, however, to reduce overall costs and waste within the demand and supply chainnetworks. TQM implementation requires ownership of responsibility by everyone

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in the company (Lamming and Hampson, 1996). Implementation of environmentalpractices may also present an opportunity to become leaner and more flexible, producinggoods using less material, reduced labour time, etc. (Vachon and Klassen, 2006).Accordingly, implementation of environmental policy requires a company to

(Hindle et al., 1993, p. 36, cited in Lamming and Hampson, 1996):

[. . .] re-examine [. . .] the needs and expectations it has to meet. It then has to develop newways of meeting those in a way which delivers the better value and performance whichcustomers want, while using less material and creating less waste.

DistributionThe e-footprint source of distribution in Figure 5 includes transports (e.g. deliveries andreturns, such as reversed logistics) and intermediaries (e.g. wholesalers) either in-houseoperated or outsourced. Considerable attention is demanded to determine whatapproach is most sustainable (Goldsby and Stank, 2000, cited in Markely and Davis,2007). Logistics have been defined by Chartered Institute of Logistics and Transport as

ensuring that the right products reach the right place, in the right quantity at the righttime to satisfy customer demand.

Distribution involves transportation, storage and delivery of raw materials, todelivering the final product to the market. An integral part of supply chain managementis that these activities may be by company-owned resources, or by outsourcing to athird-party logistics organisation.

Enormous social and environmental issues and opportunities need to be consideredthroughout the demand and supply chain network, such as reducing raw material waste,energy use, water pollution, rainwater harvesting and safety in manufacturing.Sustainable aspects include warehouse design and management, reducing packaging,enhancing safety, bearing in mind the social impact of working hours (e.g. Albert Bartlett,one of the Britains leading growers and packers, is an example of state-of-the-art

warehouse design and water recycling). Improved transportation in particularcan reducefreight vehicle numbers, fuel usage and emissions and alleviate congestion. Goodplanning and scheduling can help serve less-populated country areas and strategicallypositioned regional distribution centres will facilitate distribution to such remote areas.More and better cooperative practices are needed to develop sustainable logisticssystems, addressing many of the obstacles and creating value for all stakeholders. Withregard to logistical integration, risk associated with investment in environment-relatedactivities is reduced when organisations work collaboratively. Requirements for closeenvironmental monitoring are also reduced (Vachon and Klassen, 2006).

The marketThe e-footprint source of the market in Figure 5 includes retailers who have aresponsibility, not only to run their operations as sustainable as possible, but alsocontribute to the transparency of communicating and managing the sustainability ofprevious sources.

The market has the direct relationship with consumers who ultimately decide whatto be bought or not. At the end of the day, their willingness to buy products derivedfrom demand and supply chain networks is crucial.

Therefore, the industries consisting of different retailers, wholesalers, producers andsuppliers all need to join forces to address the total e-footprint of the demand and supply


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chain network. They cannot do it individually on a large-scale or achieve worldwidecoverage and common industry agreements and practices have to be implemented andapplied in conjunction. Most likely, global political involvement is required to create thenecessary incentives and obligations to make it happen sooner rather than later.

Ecological trends concerning the environment, depletion of natural resources, andan unprecedented recognition of the causes and consequences of global warming isnow a major government and industry focus worldwide. The 2007 Bali Treaty, andmore recently Copenhagen, COP15 in 2009, highlighted the fact that reachingconsensus on breakthrough climate change initiatives is extremely difficult. However,there are a number of industry solutions that should be in place by 2020. These includemeans of preserving energy, raw material sourcing, reducing packaging and otherwasteful resources are crucial aspects of future demand and supply chain networkdesign, probably in difficult economic circumstances where costs are volatile.

In so doing, social, environmental and economic impact may be facilitated byimproving process efficiency and accurate supply and demand forecasting. These canbe further be improved through the concept of product stewardship where companiestake a Cradle-to-Cradle approach to product development and new product design byincorporating the voice of the environment (Markely and Davis, 2007). Design for theenvironment begins within and ends outside firms boundaries. This requires productassessments as to how they are used and how disposed (Hart, 1997). The emphasis ison the need to collaborate and implement demand and supply chain networkpartnerships. This can only be achieved through shared responsibility so as to reduceenvironmental footprint. However, real change cannot be achieved by companiesacting alone and demand and supply chain network members need to work together tofind the most efficient and cost-effect solutions (Davies, 2008).

This is an opportunity to reduce use of toxic substances and promote design forre-use and recycling to improve the environmental stewardship of products. As closest

to the consumer, retailers, have an important impact on product stewardship. Theirbuying power enables them to influence and develop business partners to produceproducts with the best environmental impact. Retailers also have an important role interms of educating the consumer, providing information on provenance and facilitatingthe return of products for recycling (Guardian, Wednesday, 3 September 2008,e.g. Marks & Spencer). Product stewardship highlights the importance of demand andsupply chain network links and the influence beyond company boundaries (Lammingand Hampson, 1996). Environmental stewardship is an important part of corporatesocial responsibility and companies adopting environmental practices beyond basiclegislative requirements are gaining competitive advantage (see for example Tesco inthe UK) (Olson, 2009).

Other trends include the introduction of new markets and a new global economic

balance. Countries such as Brazil, India, China and some countries in Africa are rapidlygrowing new markets which may lead to a change in the balance between local andglobal sourcing.

Current global influencing factors changing demographic trends, such as the increasein numbers of older people in Western countries and increasing urbanisation puttingstrains and stresses on societies for land, housing, employment services, food, water, etc.This has resulted in increased government intervention and implementation byregulatory bodies at local, national and international levels. Technological advances

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and information explosion means that innovation and the scale effects of technologiesmay support radical changes in product development that can support supply chainpractices from concept design to final disposal. Successful management of sustainablebusiness practices therefore must involve coordination of product design,

manufacturing, delivery, distribution and disposal throughout the product life cycle(Hong et al., 2009).

Retailers have been forced to take notice of the environmental, economic and socialimpact of their activities (Jones et al., 2005), and increasingly addressing sustainabledevelopment is high on their agenda. Demand and supply chain network leaders holdthe key to implementing sustainable business models across demand and supply chainnetworks. Not only are they responsible for running their operations as sustainably aspossible, but they can also contribute to the transparency of communicating sustainablepractices. The environmental performance of many retailers varies considerably,however, UK grocery multiples are some of the most well-developed demand and supplychain networks in the world having infrastructure and buying power to promote greenerpractices dissemination. Their environmental programmes now address issues such as

energy efficiency, water consumption, carbon dioxide emissions, vehicle emissions,reduction in packaging waste and management of recycling improved traceability andreducing traffic congestion. A growing number of large retailers are starting tobenchmark their performance by addressing their own sustainable agendas ( Jones et al.,2005). The Future Supply Chain 2016 (p. 9) report states that the future supply chain isexpected to provide clear benefits, for industry, for individual companies, and ultimatelyfor our society.

Retailers are the main link with manufacturers and suppliers and can influencechanges in production processes, as well as consumption patterns, that favour moresustainable consumer choice (see, for example, Tesco, B&Q, M&S):

B&Q customers trust that all our products are not only good value and great quality but also

developed under principles of continuous improvement in environmental and social impactthroughout the entire supply chain, to higher standards thanits global completion (seeweb page).

Marks & Spencer CSR report:

[. . .] the ways in which Marks and Spencer products and services connect with people,the environment and animal welfare, will always be one of most demanding CSR challenges(see M&S web page).

M&S focus on five main issues: sustainable raw material, responsible use of technology,animal welfare, ethical trading and community programmes. Their buying powerenables them to influence and develop suppliers to produce products with the bestenvironmental impact. Retailers also have an important role in terms of educating theconsumer, providing information on provenance and facilitating the return of products

for recycling (Guardian, Wednesday, 3 September 2008, e.g. Marks & Spencer). Suchcustomer-facing organisational vision extends beyond the buyer/supplier dyad toencompass the entire demand and supply chain network from Cradle to Cradle inresponse to consumers desire for sustainable products and practices (Defee et al., 2009).

ConsumersThe last e-footprint source in Figure 5 includes the consumer. Consumerism can bedefined as a society in which many people formulate their goals in life partly through


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acquiring goods that they clearly do not need for subsistence or traditional display(Stearns, 1997). One can argue that increasing consumption of goods is economicallybeneficial, but on the other hand, consumerism is viewed as chronic purchasing withlittle attention being paid to the true need, origins or environmental consequences

(www.verdant.net/society.htm). The United Nations Division on SustainableDevelopment (2003, cited in Jones et al., 2005) states that:

A major cause of the continued deterioration of the global environment is the unsustainablepattern of consumption and production, particularly in industrial counties.

There has been an increase in ethical consumption since the 1990s and more generallyconsumers are becoming interested in environmental issues that directly affect them(Peattie, 1995, cited in Strong, 1997). Reasons behind this trend may include increases inpressure group support for fairer trading practices in developing countries, mediainterest, corporate social responsibility and in supplier power in the market place(Strong, 1997). As such consumerism influences global interest in sustainability and therole of consumerism in achieving long-term sustainability it is fundamentally based onthe decision-making power of the consumer (Strong, 1997). Consumers are becomingmore demanding and also empowered. As markets become more transparent andinformation about companies, their suppliers and their products easier to access andretrieve, it may be argued that consumers are gaining power (Fuchs et al., 2010). Suchconditions empower consumers who ultimately decide which products or services willbe bought and those which will not. Fuchs et al. (2010, p. 66) define empowerment as astrategy firms use to give customers a sense of control over product selection, allowingthem to collectively choose the products the company will later sell to a broader market.

Therefore, it is no longer the company but rather the consumer who decidesdemocratically, which products should be produced (Fuchsetal.,2010).Jaap(2003,p.103)suggests that user involvement helps to configure the user such that he reads the

system in the intended way.To exert influence over designs processes, products and services that foster

sustainable lifestyles requires, what Jaap (2003, p. 103) describes as silent actors to berepresented in product development decisions. Thus, Jaap (2003, p. 104) concludes thatthe re-moralization of our socio-technical landscape, by changing its material basis, is aprecondition for the sustainable behaviour of its citizens.

When considering stages in the consumption cycle, purchase, usage and disposal, candetermine degrees of environmentally friendly consumer purchasing behaviour, suchas showing a preference for purchasing products using recyclable packaging.Ulrich (1989, p. 24) emphasises this point with regards to consumer or user involvementin new product development processes, suggesting that the ability to participate had thepsychological impact of consumers immediate commitment to the finished product,

indeed they then feel owners of the decisions. By embedding involvement thatencourages sustainable product and service development could re-align values andattitudes that stimulate sustainable practices and encourage sustainable materialityin lifestyle choices (Jaap, 2003, p. 104).

Recently, facilitated by the internet, there is a shift with consumers striving foractive participation in the market place and, at the same time, companies are searchingfor ways to build strong global consumer communities. Such empowered consumersmay feel stronger bonds and develop closer relationships with such products

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and be more likely to buy them (Fuchs et al., 2010). Retailers and other companies coulddevelop better products at lower cost and lower risk. Consumer empowerment can beused as a strategy to give consumers and customers a sense of control over acompanys product portfolio (Fuchs et al., 2010).

Heightened awareness and changing preferences of consumers is a driving forcemaking business change practices to become better environmental stewards (Olson,2009). Consumer awareness and demand for new products and services is acceleratingthe adoption of sustainable practices across industries. Product portfolios andmarketing focus is changing to promote environmental issues, for example, carbonlabelling was introduced into the UK on 2007 (Olson, 2009). However, Roozen andDe Pelsmacker (2000) found that although consumers are aware of environmental claimson labels, for example, many did not believe that the brand was any moreenvironmentally friendly than brands that did not make ecological claims. There is,therefore, a tension between consumer choices and the idea of citizenship, however,increasing consumer concern and awareness of sustainability issues may be reflected intheir purchasing and lifestyle choices.

Transformative business sustainabilityThe concept of transformative business sustainability consists of:

. a multi-layer model of units (i.e. different businesses or other stakeholders); and

. a network of e-footprint sources in business applying an EE approach.

It becomes a transformative network due the continuous and simultaneousinterconnectedness between sources (procurement, production, distribution, themarket and consumers) and layers (units). It should be noted that each e-footprintsource of transformative business sustainability applies and extends beyond corporateand judicial boundaries.

A multi-layer modelWagner and Svensson (2011) propose that business sustainability shouldbe conceptualised in a demand and supply chain network applying an EE approach.They describe a generic model of business sustainability considering the life- andeco-systems on Earth. Our current model includes a transformative e-footprint (TEF)interface that interconnects a network of e-footprint sources, where each unit (of differentbusinesses and other stakeholders) is held accountable for its e-footprint in relation tothe demand and supply chain network.

When each units e-footprint is made visible and accounted for in the demand andsupply chain network, we propose that business sustainability converts into amulti-layer model as shown in Figure 4. Each layer represents a unit in the network of

e-footprint sources. All sources of each unit are interconnected to all other sources of theother units through the TEF interface (i.e. the axis going through all layers in Figure 4).

Figure 4 emphasises not only the importance of the EE approach, but alsothe TEF interface that in the multi-layer model of units becomes a recovery pool andredistribution buffer interface of surpluses and residuals in the network of e-footprintsources.Each unit should strive for a zero-sum e-footprint cycle in order to minimise and,in extension, optimise the total e-footprint of the demand and supply chain network. It isa zero-sum cycle in focus in each layer as units always have an e-footprint on Earth,


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and subsequently need to reduce and optimise it for the benefit and outcome of thedemand and supply chain network. It also means that what is a surplus or residual in onelayer causing an e-footprint in the demand and supply chain network, may be recoveredand redistributed through the recovery pool and redistribution buffer interface leading

to an optimised total zero-sum e-footprint cycle of the same demand and supply chainnetwork.

A network of e-footprint sourcesFigure 5 should be seen as an additional development of the generic model by Wagnerand Svensson (2011). Each unit must be in a position to minimise and optimise itse-footprint on Earths life- and eco-systems. However, in order to achieve transformativebusiness sustainability it is crucial to create routines and processes within each unit.This may create a ripple:

. in the network of e-footprint sources;

. on business sustainability policies; and

.

practices in procurement, production, distribution, the market and amongconsumers.

The essence is that Earth is the ultimate unit or stakeholder of origin and destination ofthe network of e-footprint sources (e.g. the bottom or top layer in Figure 4). Thisstresses the importance of interconnectedness between the e-footprint sources inFigure 5 to foster an interdependent and collaborative demand and supply chainnetwork through the recovery pool and redistribution buffer interface to other unitsbeyond judicial and corporate boundaries. Accordingly, Figures 4 and 5 strive inconjunction to illustrate the concept of transformative business sustainability.

The interface of recovery pool and redistribution buffer

The recovery pool and redistribution buffer interface becomes highly relevant andmeaningful for a number of reasons in transformative business sustainability. As shownin Figures 4 and 5, transformative business sustainability starts and ends with ourplanet Earth. The multi-layer model consists of a network of interconnected e-footprintsources having Earth as the origin and ultimate unit or stakeholder. Subsequently, thequest for an optimised total zero-sum cycle of the demand and supply chain network ismade explicit beyond just immediate business and environmental considerations ofunits towards the need for a genuine emphasis on and concern for our planet, as it is notreplaceable.

All sources in the e-footprint network part of the multi-layer modelare intertwined bythe recovery pool and redistribution buffer interface. The idea of this interface is torecover and redistribute surpluses and residuals from different e-footprint sources in the

demand and supply chain network. It serves the purpose of pinpointing and facilitatingthe interconnectedness not only between any of the e-footprint sources, but also betweenthe units in the demand and supply chain network. Any surplus or residuals of resourcescaused by one unit may be recovered in the pool and redistributed through the buffer toanother unit in the demand and supply chain network.

It should be noted that there does not only have to be recovering and redistributionactivities taking place between two closely related sources in the e-footprint network(procurement and production) and between closely related units (raw material

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producers and manufacturers), but it may be between indirect sources (production andmarket) and units (e.g. raw material producers and retailers).

The theoretical and managerial values of introducing the recovery pool andredistribution buffer interface intertwined with all e-footprint sources of the demand

and supply chain network is that it draws attention to the total zero-sum cycle of thedemand and supply chain network as well as the zero-sum cycle in each unit.Subsequently, what may not be used (surplus or residual) by one unit in the demandand supply chain network, may be recovered and redistributed to another unit in thedemand and supply chain network, for the benefit of optimising the total e-footprint.

In the following paragraph, we present a brief illustration based upon the Europeanfood industry to offer a realistic flavour to the relevance of transformative businesssustainability.

European food industry an illustrationPlacing and applying the introduced multi-layer model and network of e-footprint

sources in the European food industry, then the recovery pool and redistributionbuffer interface makes a contribution to both theory and practice of businesssustainability. A short illustration follows to describe some benefits of the introducedmodel and network.

Throughout the food chain of agricultural products in the European Union fromthe arable land to the ultimate consumer food waste is common and extensive(Salhofer et al., 2008; Amies, 2009). Many reasons cause this apparently unnecessaryand meaningless waste of food in times of global food shortages. Some waste may beexplained by European laws and regulations regarding food safety and hygiene, butthe principal problem lies in business standards and practices governing the food andretail industries.

For example, already in harvesting agricultural food products, it emerges that there

are surpluses that convert into residuals (i.e. waste), which is not recovered orredistributed to any user. As a matter of fact, many agricultural products (vegetablesand fruits) may become food waste because of being too small or large in size, having aundesired shape or colour, or other imperfections viewed as inappropriate, though thereis nothing bad or wrong with them from a food quality standpoint. In other words, thisinitial food waste is generated while the vegetables and fruits are perfectly edible, butfarmers are obliged to dispose them as these products are unwanted and do not complywith the requirements of major purchasing customers (manufacturers, wholesalers andretailers). These buyers do not want to spend time in checking the other boxes, andsubsequently the whole lot is returned or disposed unopened.

Vegetables and fruits accepted for industrial production processes may be sortedout because of flaws and damages that occurred during packaging, storage and

transportation. Products may also have become too ripe or suffered inappropriatetemperature shifts due to delays or wrong handling in storage and transport to furtherin the value-adding food chain.

After being processed in a production value-adding activity, some vegetables andfruits may still become waste. As a matter of fact, retailers dispose large amounts offruit and vegetables though they are still edible (Salhofer et al., 2008). There is little orno indications of recovery and redistribution efforts in the retail industry, shown inFigures 4 and 5. Finally, consumers also contribute to the mountain of food waste


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to a large extent. A large amount of product packages, at retailer and consumer levels,are not even opened, though there is nothing wrong with them and still edible, whenthey are disposed and turn into food waste.

In sum, food waste is generated everywhere in the food chain, from the arable land

to the final consumer. Shocking estimates indicate that almost two-thirds ofagricultural products turn into food waste (Salhofer et al., 2008; Amies, 2009). Having arecovery pool and redistribution buffer interface in place and available between units(different layers in Figure 4) of demand and supply chain networks and collaborativeattitude towards e-footprint sources (Figure 5) could assist in minimising andoptimising these surpluses of unwanted products to become residuals in the food chain.The current reality is that there is a shortage of food on a global scale and it is hardlysustainable business practice when nothing is done about the enormous food waste inthe European food industry.

Implications and lessons learned

A number of implications and lessons learned may be drawn from the introducedconcept of transformative business sustainability supported by a multi-layer modeland a network of e-footprint sources.

Accepting that business sustainability is an important global challenge, economicgrowth must be developed and decoupled from negative environmental impacts onEarth and achieved within the carrying capacity of the life- and eco-systems (Karstenand Reisch, 2008). There is a need to establish favourable conditions for the productionof e-footprint friendly goods and services solutions. At the same time, there is a need toimprove energy and resource efficiency and to promote continuous performanceimprovement and labelling. There is also a need to encourage management systems,consumption patterns and business behaviours considering the e-footprint of bothunits as well as demand and supply chain networks.

In this context consumption patterns and behaviour are essential aspects whereboth supply and demand sides need to change and evolve towards the goal of businesssustainability. In addition, the consumers contribution to achieving a better overallsustainability is important. Business sustainability engagements so far have largelyappealed to rational consumers mind and their ability to adopt and change behaviouras well as consumption pattern.

From this perspective, we argue that the introduction of the recovery pool andredistribution buffer interface as part of business sustainability models gain theattention of the network of e-footprint sources and total e-footprint of demand andsupply chain networks. Companies produce bundles of goods and services solutionsthat create and contribute to consumer value. In so doing, business sustainability musttake into account business that includes metrics for carbon emissions, reduced energy

consumption, better traceability and reduced traffic (Barnes, 2008).Performance measurement and benchmarking before and after the introduction of

business sustainability initiatives are imperative in calculating the e-footprint by units.This requires decision-making processes to support the planning, implementation andevaluation of business sustainability.

Utilising the multi-layer model and the network of e-footprint sources outlined inthis article may be a starting point, or point of reference, to establish sound businesssustainability in the marketplace and across societies. Considering interconnections

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and calculating trade-offs within and between units and sources of the multi-layermodel, in conjunction with assessment of available resources and technologies with themix of human capabilities, skills in managing the recovery pool and redistributionbuffer interface, will enable ongoing environmental monitoring of units and demand

and supply chain networks e-footprints. Corporate learning and sharing of experiencesplay a key role by inculcating and adopting shared organisational values and views tounderpin and manage business sustainability appropriately.

Retailers, wholesalers, intermediaries, manufacturers, suppliers and producers ofraw materials suppliers need to join forces to reduce the total e-footprint in demand andsupply chain networks. This cannot be achieved on a large-scale individually orworldwide. Common industry agreements and partnership practices should beimplemented and applied in combination with individual company capabilities. It isunlikely that business sustainability-related goals will take precedent over performancecriteria (such as cost, quality and delivery) on their own. Most likely, global politicalinvolvement is required long term to create the necessary incentives and obligations tomake significant worldwide change.

Conclusions and suggestions for further researchA multi-layer model of units (i.e. different businesses or other stakeholders) and anetwork of e-footprint sources representing transformative business sustainability areshown in Figures 4 and 5. The model and the network in focus are applicable on differentunits and demand and supply chain networks, though potentially not all. Furthermore,they do not just shed light on the importance of the immediate business sustainabilityconcerns of units, but also demand and supply chain networks as well as the planetEarth with its life- and eco-systems. The latter appears to be under non-sustainablepressure and destiny at the moment (IPCC WGI Fourth Assessment Report, 2007).

The multi-layer model offers research opportunities in terms of examining

additional e-footprint sources in different demand and supply chain networks. Thoseoutlined offer some insight and their universal applicability across demand and supplychain networks need to be verified. We believe the e-footprint sources introducedprovide a seed and foundation to be built upon. The crucial contribution at this stage isthe recovery pool and redistribution buffer introduced in the multi-layer model andfounded in empirical evidence from the European food industry (Salhofer et al., 2008;Amies, 2009). This interface also offers further research opportunities in examining itsrelevance and value across demand and supply chain networks using its underlyinglogic within the multi-layer model. We believe that the likely validity and generality ofthe tool is high, but needs further examination for it to be sustained or not.

In sum, whatever the e-footprint source in the multi-layer model of transformativebusiness sustainability, the well-being of the planet Earth has to be at the core of

business sustainability. We contend that this is where our coined recovery pool andredistribution buffer interface plays a crucial role and makes both a theoretical andmanagerial contribution by achieving genuine and continuous business sustainabilitythrough the awareness at strategic, tactical and operative levels of business, beyonduse of empty buzzwords and shallow window dressing. We believe that the logic ofthe interface is easy to understand and communicate within demand and supply chainnetworks to achieve and enhance a common goal of planned, implemented andevaluated efforts toward business sustainability.


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Corresponding authorGoran Svensson can be contacted at: [email protected]

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