The natural environment poses a problem for economic theory. Even if we accept, for the sake of argument, that the free market serves both employer and employee, buyer and seller, equally, the environment may be harmed by market transactions. 

The air and water can suffer. Economists calls this the problem of externalities. 

What does sustainable enterprise mean and are there any?


The growing public and government concerns about the effects of large corporations on society and environment led to the emergence of Corporate Social Responsibility (CSR) as a developing agenda which focused mainly on the company’s marketing practices and communications, and the impact of their operations on workers in their supply chain (including their families) and communities. However, until recently the CSR is gradually being replaced by the practices of sustainability.

 

Sustainable enterprise is an enterprise that has a minimal negative impact on the environment. They have progressive environmental and human right policies. Mainstream businesses today are striving or at least planning to become a sustainable enterprise. With the growing concern of consumers with a company’s sustainable practices to make their purchasing decisions, it is becoming increasingly important for businesses to incorporate sustainable business practices into their operations. This will not only be beneficial for the environment but also ensure a long term stream of profits for the firm as more and more consumers in the future will end up buying their products.

Nonetheless, since the economic returns on investments in sustainable projects may take up three years or more to show up, sustainable enterprises are still rare globally.

For example, Marks & Spenser aim to make the company as the world’s most sustainable retailer by 2015. The retailer is working not only with its suppliers but also customers to deal with climate change, use of sustainable/green raw materials, cut down on waste, involve ethical trade practices and help people to adopt healthier lifestyles.