Environmental and Ethical Issues

Pollution. Air, water, soil, noise pollution from operations. Affects local communities, ecosystems, and increasingly attracts regulatory penalties.

• Address: cleaner technology, emission treatment, regulatory compliance, monitoring.

Resource depletion. Using non-renewable resources (oil, rare metals).

• Address: shift to renewables (solar, wind, recycled materials), design for repairability and longevity, circular economy principles.

Climate change / carbon emissions. Greenhouse-gas emissions warming the planet — driven by manufacturing, transport, electricity, agriculture.

• Address: switch to renewable energy, electric vehicle fleets, energy efficiency, carbon offsetting, reducing travel.

Waste / disposal. Packaging, by-products, end-of-life products in landfill — including toxic e-waste from electronics.

• Address: reduce packaging, use recycled materials, take-back / recycling schemes, biodegradable alternatives.

Why this matters for business.

• Regulations are tightening (carbon taxes, packaging rules, emissions limits).
• Customers prefer eco-friendly brands and pay a premium for them.
• Investors increasingly screen for ESG (Environmental, Social, Governance) factors.
• Employees prefer to work for environmentally responsible firms.

Cambridge tip. When asked about environmental issues, give SPECIFIC issues (not just 'the environment') and SPECIFIC mitigations.

Working conditions in supply chain. Suppliers may use child labour, pay below living wages, force long hours, ignore safety.

• Address: audit suppliers, set ethical sourcing standards, certify (Fair Trade, B-Corp), terminate non-compliant suppliers.

Honesty in marketing. Misleading ads, exaggerated claims, hidden costs, fake reviews.

• Address: clear pricing, truthful claims, internal review, comply with consumer-protection laws.

Animal welfare. Cosmetics testing on animals, factory farming, sourcing from cruel practices.

• Address: cruelty-free certification, alternative testing methods, sourcing with welfare standards.

Diversity and inclusion. Hiring biases, gender pay gaps, lack of accessibility.

• Address: blind recruitment, pay transparency, accessibility standards, diversity targets.

Data privacy. Collecting more data than needed, selling without consent, weak security.

• Address: minimise collection, clear consent, strong security, comply with data-protection laws.

Cambridge tip. Mark scheme rewards CONNECTING the issue to a SPECIFIC stakeholder concern (workers, customers, suppliers, community).

Corporate Social Responsibility (CSR). A business approach that goes BEYOND profit to consider impact on workers, customers, community, and environment.

Three components of CSR.

• People — fair treatment of employees, suppliers, communities.
• Planet — environmental responsibility.
• Profit — long-term, sustainable profit (not just short-term).

Why ethics increasingly pays.

Customer loyalty and premium pricing. Customers (especially younger ones) prefer ethical brands. Many willing to pay 10-30% more for fair-trade, organic, cruelty-free, sustainable products.

Employee engagement and retention. Workers prefer ethical employers. Lower turnover saves recruiting and training costs; better motivation raises productivity.

Reduced regulatory and reputational risk. Avoiding scandals (sweatshops, pollution, fraud) avoids fines, lawsuits, reputational collapse.

Investor preference. ESG-focused funds (trillions in assets) screen out unethical firms.

Long-term sustainability. Firms that destroy their resource base (overfishing, soil depletion) eventually run out of inputs.

Greenwashing risk. Cosmetic claims without operational change. Customers and employees increasingly see through it. Authentic CSR = real changes to OPERATIONS, not just marketing.

Cambridge tip. Top-band evaluation answers acknowledge that ethics CAN be costly in the short term but pays off long-term — and the trade-off has narrowed.