Environmentally Sustainable Business: the UK Aviation Industry - Case Study Example

Running Header: Environmentally Sustainable Business: UK Aviation Industry Your Introduction The UK aviation industry is a major has impact on the economy employing over 200,000 employees directly and other 500,000 indirectly. The industry generated £11.4 billion to the UK’s GDP by 2009 (Sustainable Aviation, 2009). However the industry has been accused of contribution more than its equivalent progressive financial growth in environmental degradation in terms of air pollution or carbon (CO2) emissions, noise pollution, fuel among others [see Figure:4]. Nevertheless the industry through its umbrella body Sustenance Aviation (SA) has made major progress to curb and enhance environmental sustenance by initiating several notable programs. This has however been achieved after several years of denial and intransigency as affiliate either disputed environmental concerns or claimed that there was very little that could be done other than grounding the sector to a halt (Tol and Yohe, 2006) Zadek Five Stages Framework Zadek (2004) alleges that most business corporations pass or evolve through five stages as they edge closer to social responsibility: defensive, compliance, administrative, premeditated, and social responsibility. This can be equated to organisations realising the importance of environment sustenance and conservation. In the first stage, the company adopts a defensive or denial attitude even in the face of overwhelming criticism thus remarking, ‘Its not our job to fix that.’ In the second stage is that of compliance when the firm aims at stemming mounting criticism and litigation but just doing the basic minimum hence dubbed, ‘Well do just as much as we have to.’ The third stage ‘It’s the business, stupid’ the managerial stage, the corporation recognize the long-standing difficulty of not complying thus allocates the management of the firm the task of ensuring compliance. In the fourth stage, ‘it gives us a competitive edge’, the corporation discerns just how important and beneficial sustainability compliance is to the firm and now actively pursues the stratagem. This eventually leads to a decision that ‘we need to make sure everybody does it’ as the idea of collective responsibility takes root. This may be part of the corporate strategy of the firm as they realise the effect of other stakeholders have on their operations in terms of ecological degradation (Zadek, 2004). The UK Aviation industry has made tremendous progress as envisioned in Zadek (2004) framework whereby through the progress report released in 2009, the industry seems to have come to the conclusion that environment protection and preservation was critical for all civilisation. Through its umbrella organisation, Sustainable Aviation established in 2005 when the industry reached the fifth stage, they realised the importance of incorporating all the stakeholders in the industry to collectively address environment sustenance issues. The 2009 progress report unveiled a blueprint roadmap that was structured to address ‘eight goals and 34 commitments, covering the environmental, economic and social impacts of aviation’ (Sustainable Aviation, 2009, Pg. 4). Carbon CO2 Emissions In terms of CO2 emissions, the association anticipated that CO2 emissions will swell up to 2020 but then stabilize and decrease to less than the 2000 levels by 2050. The UK’s Sustainable Aviation (SA) report in 2009 and ‘roadmap’ for carbon emissions reduction has therefore targeted a reduction to less than the 2000 levels by 2050 after peaking around 2020 notwithstanding the expected tripling or higher passenger numbers during the same period. This will be affected by enhancing the existing airframe and apparatus designs in addition to other innovations like blended wing frames and open rotor mechanisms that will curb emissions by 62 percent. Enhanced air traffic operations can further reduce by ten percent while low carbon substitute fuels like bio jet fuels curb a further ten percent (Sustainable Aviation, 2009). The projection however is mostly based on the expected heavy current and forward investments undertaken within the industry by both private and public initiatives. [See illustration Appendix Figure: 3] Emissions Trading The sector has also campaigned for their inclusion in the European Union (EU) Emissions Trading Scheme (EU ETS) by 2012 to assist the industry offset the heavy investments needed to contain the CO2 emissions adequately. In further proof of the aviation industry maturity to Zadek’s final stage, SA has actively lobbied for a global approach to climatic change particularly on CO2 emissions, through several UN organisations. SA has therefore called for a global approach to which were omitted from the Kyoto Protocol and international directives. Bio-jet fuels Caldecott and Tooze (2009) ascribe to more utilization of bio-jet fuels as the only viable alternative to carbon emissions without compromising air travel. However, the authors decry the laxity among both the UK and EU authorities in adequately addressing the issues of Emissions Trading Scheme (EU ETS) and UK Air Passenger Duty (UK APD), which do not adequately support investing firms in the proposed sectors. Caldecott and Tooze (Pg.21) have therefore proposed four approaches to ensuring the adoption of bio-jet fuels. These include the establishment of sustainable demand through the EU Sustainable Bio-jet Fuel Blending by 2020; enhancing support for firms conducting research and development (R&D) in the bio-jet fuel field; further investment, regulation and guidelines be enacted; and minimising the supply chain expenditure for firms in the sector. These measures can assist in cutting on GHG emissions from aviation by 15 percent by 2020 and 60 percent by 2050. Nonetheless SA has made considerable progress by carefully observing the ACARE (Advisory Council for Aeronautics Research in Europe) 2020 goal for an eighty percent cutbacks in Non- CO2 emissions. The SA progress report alludes to the future prospects of lower life-cycle carbon bio-jet fuels and oil-based kerosene fuels. However the development of bio-fuels has been somewhat sluggish due to concerns over the effect on food production, drinking water and use of arable land. Noise Pollution Airports and airlines are notorious for emitting high octave noise levels which adversely affects communities residing near their areas of operation. SA has proposed for its members to observe the ACARE noise reduction levels objectives. This has largely being enhanced through the application of the Continuous Descent Approaches (CDA) as opposed to a stepped approach in 80 percent of flight landings at the Heathrow, Gatwick and Stansted airports. Technological advancement as exemplified by the Airbus A380 has greatly reduced noise levels without compromising size and quality. The Global Environment Outlook (GEO) project initiated by the United Nations Environmental Programme (UNEP) was an aimed at assisting in management of the environment through capacity building by offering various options for action. The UNEP’s GEO commissioned in 1995 is therefore ‘a process and a series of reports, analyzing environmental change, causes, impacts, and policy responses’ (Pg.1). The UK aviation industry (SA) has also urged for global policy framework which aims at accomplishing constancy in alleviating greenhouse gas levels in the environment at an intensity that would check hazardous synthetic intrusion among the environmental structure (Sustainable Aviation, 2009, p. 11). [See progress illustration Figure: 4] Green E-Commerce and IT Within the UK, ecommerce has taken root with 10 percent of all retail sales amounting to over 30 billion being conducted online. This trend has seen a growth escalation of approximately 45 percent every six months or a 2,000 percent rise in six years. The significance of these on the environment is that there less mileage by retailers, reduced inventory needs, less paperwork hence green effect, reduced packaging though mainly on online music downloads, reduced wastage as the product lifecycle diminishes and dematerialisation or digitalisation effect as emails, music and videos are shipped online (Siikavirta et al, 2005, Pg. 92). The UK aviation industry through SA has encouraged their member associations to utilise online bookings and communication through their websites hence offset CO2 emissions, wastage and other degradation effects (Sustenance Aviation, 2009). A UK study on grocery shopping by Cairns (2005) estimated that 40 percent of households used their vehicles for shopping hence substituting with online shopping can reduce emissions by 70 percent. Siikavirta et al (2005) in their study of Finnish approximated a 87 percent reduction in emissions from 18 percent with more effective ecommerce methods, while practically financial giant HSBC has effectively reduced emissions by offering online paperless statements estimated at 35 percent range. According to the 2009 Sustainable Report by an alliance of UK airlines, airport authorities and aerospace producers collectively named Sustainable Aviation (SA), the aviation industry was on track in observing its environmental targets of curbing carbon (CO2) emissions roadmap, emissions trading, noise level reduction, air quality & surface access, enhanced air traffic management, Non- CO2 emissions, sustainable biofuels, fuel efficiency, and carbon offsetting (Sustainable Aviation, 2009). Similarly, the association in response to the release of the report by Committee on Climate Change on UK Aviation Industry 2009 affirmed their commitment towards curbing environmental degradation which they were confident could be achieved without limiting the industry’s growth by strictly following the 2009 aviation progress roadmap. The Three Pillars of Sustainability Efforts to enhance ecological sustenance necessitate the need to balance environmental, social and economic demands of the world’s inhabitants. These are collectively dubbed the ‘three pillars’ of sustainability required to uphold the ideals of prolonged ecological balance as espoused in the United Nations World Summit in 2005 (United Nations, 2005). In this regard the principle of environmental sustainability entails the use of our natural resources conservatively avoiding obliteration and destructive practices for the good of the future generations, thus the utilisation of non-renewable reserves must be actively enhanced to guarantee the lives of our offspring (Pearce et al, 1989, Pg.176); (Robinson, 2005, Pg.1). One of the main emerging issues in the conservation of the environment and sustainability is the curbing of the greenhouse emissions or minimising carbon emissions unto the stratosphere, which has been linked to the erosion of the ozone layer. This atmospheric belt protects the earth from direct ultraviolet glare of the sun that can have catastrophic effects on the planet wiping out entire generations of earthlings. The major pollutants that emit this harmful carbon energy are manufacturing plants that use conventional forms of energy like petroleum and electricity [see Appendix, Figure: 1] (Businesslink.gov, 2009). Clean Energy Technology The use of clean energy technology or products can help alleviate the excessive overreliance on non-renewable forms of energy. These innovative alternatives include biomass energy, micro-combined heat and power devices, biodiesel or battery and hybrid powered vehicles that utilise non-fossil engines. Other strategies employed include replanting the both the arable and reclaimable land with vegetation that will absorb the carbon emissions from the manufacturing plants. Building materials that do not engage a lot of carbon emitting raw materials are encouraged while regeneration has become the norm to stem the tide of ozone deprivation. SA through its Clean Air commitment framework has made this one of its key initiatives with various projects ongoing with cleaner emitting vehicles allotted at airports e.g. the Heathrow Clean Vehicles Programme even as British Airways was awarded the Diamond award for exhaust reduction initiatives. The Clean Sky Joint Technology Initiative (JTI) an EU-wide project seeking to establish Sustainable and Green Engines (SAGE), one of the six Integrated Technology Demonstrators (ITDs) is a €425 million affirmation plan will engage the design and manufacture of five engine prototypes (Sustainable Aviation, 2009, Pg. 15). Sustainable Value Framework Hart & Milstein (2003) have devised a model, the Sustainable Value Four-Framework quadrant in which the current elements vis-à-vis future sustainability issues are addressed. The current strategies are weighed against future prospective approaches while the internal growth prospects are measured against external future growth prospects and perceptions. The UK aviation industry through its stated goals sustainable framework of reducing greenhouse emissions, wastage, embracing green technology among other measures is also a similar project. This encompasses minimising current wastage, emissions to cleaner technology and efficiency among its member affiliate organisations (internal) while engaging other stakeholders in the industry and wider public towards a sustainable shared roadmap as in the 2009 blueprint (external) to ensure a more inclusive and comprehensive program. Hart and Milstein (2003) have thus proposed a multi-dimensional approach to these challenges linking the three triple challenges of economic, social and environmental factors (the triple bottom line) rather than the dogmatic view adopted by most companies. EPA administrator William Ruckelshaus thus remarked that, ‘sustainability is as foreign a concept to managers in capitalist societies as profits are to managers in the former Soviet Union’ (Pg. 56). Hart and Milstein sustainable value framework integrates shareholder values whereby each driver of sustainability impact on the strategic approach of the firm [See Figure 5]. Conclusion From the analysis of the UK aviation industry sustenance commitment programs, we discern that issues of environmental conservation and sustenance are not merely confined to the manufacturing industry, government agencies and civil societies but must be a concerted effort by all citizens of this planet Earth. The continued CO2 emissions poses grave danger to the environment as the protective ozone layer gets eroded while the reckless wastage and degradation of the non-renewable natural resources may eventually lead to social economic problems as populations’ conflict over dwindling resources. Hart and Milstein (2003) quadrant is therefore illustrated by UK’s Sustainable Aviation (SA) body which has laudably launched several progressive measures to halt the negative trends that should be emulated by other industries that have an equal stake in the well being of our planet. Innovative technology, non-fossil fuels energy, less wastage, and conservation is the key to alleviating environmental degradation and sustenance as many people reach the final stage of maturity in terms of environmental matters as envisioned by Zadek (2004). References Ehrlich, P.R. & Holden, J.P. (1974). "Human Population and the global environment." American Scientist 62(3): 282–292. Cairns, S. (2005) Delivering Supermarket Shopping: More or Less Traffic? Transport Reviews, Vol. 25, No. 1, 51–84, January 2005 Grunda, R. Č. (2006). Sustainable Business: The Natural Step (TNS) Framework. Kaunas: Vilnius University. International Institute for Sustainable Development. (2009). What is Sustainable Development? Retrieved February 19, 2010, from Iisd.org: Microsoft. (2009). Microsoft’s Top 10 Business Practices for Environmentally Sustainable Data Centers. Seattle: Microsoft Corp. Milstein, S. L. (2003). Creating Sustainable Value. 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Zadek, S. (2004). The Five Steps of Corporate Responsibility. Harvard Business Review, Vol. 82, No. 12. Appendices Figure1: Global CO2 Emissions by Sector Source: Sustainable Aviation (SA) Report – 2009 Pg. 3 Figure 2: UK Aviation Projected Emissions Reduction by 2050 Source: Sustainable Aviation (SA) Report – 2008 Pg. 2 Figure 3: UK Aviation Industry Sustenance and Commitments Progress Source: Sustenance Aviation Report (2009), Pg. 5 Figure 4 Figure 5: Sustainable Value Framework Source: Hart and Milstein (2003) Pg. 57 Read More