1. Introduction
Industrial revolution has encouraged countries all over the world to present many kinds of products to fulfill local needs and for export purposes. This situation involves the use of various raw materials that come from natural resources or chemical materials. The uncontrolled and unplanned production causes the production waste to damage the environment to some extents. In other forms, some products also use environmentally unfriendly materials that may endanger particular species.
Due to the increasing awareness of preserve the environment, business does not deal merely with profit and corporate strategy. In addition, as consumers put great concerns toward health and safety issues, companies are driven to manage their own waste (in the sense of producing only recyclable waste) and produce safe, healthy and recyclable products. The phenomenon does not only occur in the United States but also in other countries all over the world. This action to pay attention to preserve environment and surrounding communities refers to corporate social responsibility.
Concerning this issue, this paper will discuss the global environment problem especially relates to corporate social responsibility and sustainability. There are seven scholarly journals that becomes the main material for this paper. The discussion of the journals spans from global warming, ozone protection to some issue about international environmental law.
Prior to the discussion of global environmental issue and the development of environmental lawmaking, this paper will discuss the meaning and scope of corporate social responsibility and the relation between corporate social responsibility and environmental initiatives.
2. Corporate Social Responsibility (CSR)
2.1. Definition
By definition, corporate social responsibility means the accomplishment of business success that respects the ethical values, environment, communities, and people. It means that business that integrates the CSR issue in its operation will likely to incorporate several factors like commercial, ethical, legal, and other aspects that communities concern in order to provide fair decision for all stakeholders (BSR Staff, 2004).
Since CSR is a complete set of program, practices, and policies that is adoptable in all business operations, decision-making procedures, and supply chains; its impact on business economic performance is favorable.
2.2. Scope of Corporate Social Responsibility (CSR)
However, the model of corporate social responsibility is still growing due to the globalization that becomes the driving factors of this concept. This is because the borderless business has encouraged the provision of international policies do not restricted by political and geographical boundaries.
In addition, the scope of corporate social responsibility also grows since new problems that relate to responsibility of a business continue arises. The problems include wrong marketing campaign that leads to misperception, intolerable level of pollution from factories and vehicles, harmful factory waste.
2.3. Modern Definition of Corporate Social Responsibility (CSR)
Under such circumstances, the definition of CSR also develops. According to Bucholtz (1991, p 19), modern definition of CSR incorporates globalization aspect that influence today business practice. Furthermore, the modern definition of CSR emerges as the several core considerations:
a) Business is responsible of going beyond the fabrication of products and services to generate profits
b) Business is responsible of helping communities to solve social problems
c) Business has broader constituency than stockholders alone
d) Business must be aware of the impact of their operation and products that goes beyond commercial transactions
e) Business serves broader range of values than merely focuses on profitability factors
2.4. Corporate Social Responsibility (CSR) and Environmental Approach
Another important part of CSR is environmental issues. Some multinational companies or enterprises (MNCs/MNEs) focus on their environmental performance in order to increase their compliance to CSR principles.
For example, Exxon, increases its CSR performance by paying attention to global warming issues. The underlying reasons that drive Exxon to do the initiates is because managements of Exxon believe that global warming issues have shaped Exxon’s entire design of the corporation. For the reason, the company strives for improve energy efficient refineries, which shaved their global warming emission (‘Exxon’s Approach’, 2005).
3. Global Environment Problem and Corporate Social Responsibility (CSR)
3.1. Global Warming
Global warming becomes a major environmental issue today and will likely to be the most important environmental issue in the near future. Concerning the situation, scientist, graduates, students, and even some movie spectators now aware of the impact of global warming in human’s existence.
The “The Day After Tomorrow” movie displays the horror of having an instant ice age all over again. The climate change will be disastrous. Even most of the scenes are impossible; the motion picture shows that the earth’s climate has a very delicate balance, which is in fact, a scientific truth. In Global Climate Change, it is said that
Moderate increases in atmospheric temperatures could alter precipitation levels, making some areas wetter and others drier, and affecting agriculture worldwide. Warmer temperatures could increase the frequency and strength of storm systems, leading to more powerful and destructive hurricanes and subsequent flooding (2002).
Moreover, The Intergovernmental Panel on Climate Change (IPCC), a group established by the World Meteorological Organization (WMO) and the United Nations Environment Programme (UNEP), also provides interesting evidences that “the average surface temperature of the earth has increased during the twentieth century by about 0.6° ± 0.2°C. (The ± 0.2°C means that the increase might be as small as 0.4°C or as great as 0.8°C.”
3.2. International Environmental Law
3.2.1. Shared-compact Provision
There are many approaches in dealing with environmental issue from lawmaking point of view. For example, Drumbl (1991) suggests an idea to adopt shared compact provision that emerged from self-interest and principled motivations. This idea increasingly plays significant role in international environmental governance since it represents the precedence to any compliance, ratification, and the adoption of environmental abatement commitment.
3.2.2. Legitimacy and Challenges of International Environmental Law
However, Bodansky (2006) reveals that the formulation of international law faces a dilemma. This is because some international environmental issues like climate change demands more authoritative system in international governance that does not require the concerted agreement or consensus among countries in the world. However, without legitimacy, countries will not adopt the international environmental law since they do not entrust the international environmental institutions.
In this manner, the challenges for international environmental institutions are to building legitimacy that involves trust that the organization will issue only the appropriate decision making for the good of all countries.
Realizing that building trust is not a simple task, international environmental institutions must consider it as long-term project. Most importantly, institutions must realize that it is easy to destroy legitimacy than build it. The situation happens since the factors that make an institution to be legitimate are depending on trust.
3.2.3. Economics of Environmental Regulation
In the previous sections, there is elaboration about the impact of mass destruction as the result of damaged environment. The situation suggests that the unmanaged environment will costs a country a large amount of money needed to restore the already damaged environment and to develop sets of rule to prevent the situation happened again in the future.
Concerning this issue, Faure (1998) views the economics impacts of environmental regulation by using cost-benefit analysis in environmental policy and law and in environmental standard scheme.
To be specific, Faure (1998) put great concerns over the development of regulation for several environmental problems such as nuclear risk, marine oil pollution. Regarding the nuclear risk, to be precise, Faure (1998) reveals the need to address the characteristic and impacts. This is because, according to previous researched conducted by Nichols and Wildavsky (1987), Pate Cornell (1987), and Feistein (1989), nuclear risk is such a low-probability accident.
However, the low-probability risk will have huge impact on environment and the living things if the regulation on nuclear energy is violated. Faure (1998) reveals that there is an increase in the number of violations that occurs in the US nuclear power plants including the Three Mile Island accident.
Meanwhile, regarding marine oil pollution, there is one main related question that economists put great concerns; the question is about the notion to invest in the safety of the tankers in order to prevent oil spills.
However, the intention to enforce the marine oil pollution finds difficulty since Protection and Indemnity clubs are the responsible institutions in case the oil spills exist and therefore will cover the full insurance for the imposed fines (Faure, 1998).
3.2.4. Harmonization of International and Domestic Law on Transboundary Pollution
The issue to enforce the international regulation on environment is driven by the fact that there are situations where pollution impacts two or more countries in which each country has different treatment in dealing with the situation.
According to Hall (2006), transboundary pollution refers to an occurrence of pollution that originates wholly or in part within one jurisdiction area (country) but the impacts also occur in other jurisdiction areas. This situation that may lead to dispute is critical since historically nations and people will go to war when they face dispute over environment and natural resources. The case of dispute on Ambalat block between two countries in Southeast Asia is an example of the increasing tension caused by the dispute on a block of natural resources (oil wells).
Under such circumstances, Hall (2006) suggests that there should be encouragement of harmonization of environmental law in order to generate a system that provide win-win solution for states/countries that have quarrel over the resolution of transboundary environmental pollution problems without threatening state sovereignty.
4. Conclusion
Environmental pollution becomes an important issue in the world since the violation of the environmental regulation will damage environment and living creatures. Concerning the issue, this paper discusses the global environment problem especially relates to corporate social responsibility and sustainability. We use five scholarly journals as main sources in writing this paper that concerns about global warming, creation of international environmental law, and the resolution of transboundary environmental pollution cases.
Bibliography
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Bucholtz, Rogene A. (1991). Corporate Responsibility and the Good Society: from Economics to Ecology. Business Horizons, pp. 19
Brunee, Jutta. (2004). The United States and International Environmental Law: Living with Elephant. EJIL, 15, 617 – 649
BSR Staff. 2004. Overview of Corporate Social Responsibility. Business for Social Responsibility. Retrieved May 25, 2007 from <http://www.bsr.org/search>
Drumbl, Mark A. (2001). Poverty, Wealth, and Obligation in International Environmental Law. Washington and Lee Public Law and Legal Theories
‘Exxon’s Approach to CSR’. 2005. Retrieved May 26, 2007 from http://busmovie.typepad.com/ideoblog/corporate_social_responsibility/
Faure, Michael G. (1998). Environnemental Régulation. Institute for Transnational Legal Research
Hall, Noah D. (2006). Transboundary Pollution: Harmonizing International and Domestic Law. University of Michigan Journal of Law Reform
