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GREEN BUSINESS: CHALLENGES AND PRACTICES

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Abstract

The paper deals with the relatively new worldwide trend of adding a “green” slant to business. The purpose of the research was twofold: firstly, to clarify the definition of “green business”, secondly, to test the hypothesis that the differences in business penetration by “green” ideas in various countries are to a large extent determined by national specifics in terms of economic development and public consciousness. Authors compare and contrast the commonly found definitions of “green business”, clarify a distinction between the “green business” notion and that of “sustainable business”, define the main agents of the business “greening” trend, discuss what it means to be “green” and what business practices qualify it as “green”. A quantitative empirical research method – a survey via a questionnaire distributed to respondents by e-mail or handed in directly – was used for the second purpose of the study. The survey was conducted by the authors in Lithuania and Ireland. The collected primary data were processed with the SPSS program and analysed by methods of correlation analysis. The research has revealed considerable differences in the “green” attitudes and practices of Lithuanian and Irish companies, the former being more concerned with costs than benefits of becoming “green”, and the latter demonstrating awareness that being “green” opens new revenue-raising opportunities. Key words: green business, environmental awareness, green attitudes and practices
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ISSN 1392-1258. EKONOMIKA 2014 Vol. 93(1)
GREEN BUSINESS: CHALLENGES AND PRACTICES
Linas Čekanavičius*
Vilnius University, Lithuania
Rugilė Bazytė
Strathclyde University, United Kingdom
Agnė Dičmonaitė
Vilnius University, Lithuania
Abstract. The paper deals with the relatively new worldwide trend of adding a “green” slant to business. The
purpose of the research was twofold: rstly, to clarify the denition of “green business”, secondly, to test the hy-
pothesis that the dierences in business penetration by “green” ideas in various countries are to a large extent
determined by national specics in terms of economic development and public consciousness. Authors com-
pare and contrast the commonly found denitions of “green business”, clarify a distinction between the “green
business” notion and that of “sustainable business”, dene the main agents of the business “greening” trend,
discuss what it means to be “green” and what business practices qualify it as “green”. A quantitative empirical
research method – a survey via a questionnaire distributed to respondents by e-mail or handed in directly – was
used for the second purpose of the study. The survey was conducted by the authors in Lithuania and Ireland.
The collected primary data were processed with the SPSS program and analysed by methods of correlation
analysis. The research has revealed considerable dierences in the “green” attitudes and practices of Lithuanian
and Irish companies, the former being more concerned with costs than benets of becoming “green”, and the
latter demonstrating awareness that being “green” opens new revenue-raising opportunities.
Key words: green business, environmental awareness, green attitudes and practices
Introduction
The notion of “green business” emerged at the end of the 20th century in the wake of the
ever increasing public concern about the sustainability of economic development. The
latter, in turn, was roused up by the growing awareness of environmental issues such as
the accelerating depletion of natural resources and the deterioration of environmental
quality. While the origins of the modern “green movements” can be traced down to
the middle of the 1960s, it took almost 20 years for business to adapt to the “greening”
trends and adopt them into its ideology and practice, coining the term“green business”
* Corresponding author:
Faculty of Economics, Department of Quantitative Methods and Modeling, Vilnius University,.
Sauletekio Ave. 9-2, LT-10222, Vilnius; e-mail: linas.cekanavicius@ef.vu.lt
75
for that purpose. However, even today, the substance of the green business concept is
rather ambiguous as demonstrated by the variety of its denitions that could be found in
different sources. Furthermore, green business practices are still far from being univer-
sally embraced and applied by business entities around the world, with perceptible dif-
ferences of business penetration by the “green” ideas in various countries. This is due to
several reasons, one of them being the fact that the “greening of business” is still largely
perceived as an extra burden (in terms of cost increase or revenue loss), and the other
reason being related to the national specics in terms of cultural, political, and economic
differences.
The purpose of the present research was twofold: rstly, to clarify the denition of
“green business”, secondly, to test the hypothesis that the differences in business pen-
etration by “green” ideas in various countries are to a large extent determined by national
specics in terms of economic development and public consciousness. A quantitative
empirical research method – survey via a questionnaire distributed to respondents by
e-mail or handed in directly – was used for the second purpose of the study. The survey
was conducted by the authors in Lithuania and Ireland. The collected primary data were
processed with the SPSS program and analysed by the methods of correlation analysis.
Green business: denition
The aforementioned “genetic” link of the green business ideology with that of sustain-
able development explains why it is often perceived – explicitly or implicitly – as being
synonymous with the notion of “sustainable business”. For instance, Brown and Ratledge
adopt quite a narrow denition of green business as “an establishment that produces
green output” (Brown, Ratledge, 2011). Meanwhile, Makower and Pyke, in a broad-
brush way, state that “a green business requires a balanced commitment to protability,
sustainability and humanity” (Makower, Pyke, 2009). The Business Dictionary indicates
that green business is “a business functioning in a capacity where no negative impact is
made on the local or global environment, the community, or the economy”, and further
adds that “green business will also engage in forward-thinking policies for environmen-
tal concerns and policies affecting human rights” (Business Dictionary, n.d.). Similarly,
G. Croston states that “Green Businesses have more sustainable business practices than
competitors, beneting natural systems and helping people live well today and tomor-
row while making money and contributing to the economy(Croston, 2009). K. Slovik
proposes an amalgamation of environmental sustainability demand with that of social
responsibility: “A “green business” can be dened as an organization that uses renew-
able resources (environmentally sustainable) and holds itself accountable for the human
resource aspect of their activities (socially responsible)” (Slovik, 2013).
76
Quite obviously, all these denitions attempt to embrace a wider impact spectrum of
business activities and not only those that could be considered as “green” sensu stricto,
i.e. as related to the environment. The requirement of commitment to the environmental
considerations is here complemented by the imperative to honour human rights and to
contribute to the well-being of current and future generations while ensuring the eco-
nomic sustainability of business itself. Such approach obliterates boundaries between
the notions of “green business” and “sustainable business”, the latter term referring to
business being sustainable economically, socially and environmentally.
The other authors take a narrower approach, focusing on the “green” constituent of
the term. They dene green business as the one being concerned with and support-
ing environmentalism” and “tending to preserve environmental quality“ (Green Times,
2013), which “has made an enduring commitment to environmental principles in its
business operations (Cooney, 2008), as “business or entity preparing a plan and taking
action to reduce its environmental impact on its immediate area of concern” (Sustainable
Green, 2013) or, even stronger, as “business where its activities do not have a negative
impact on the environment” (Calling Green, 2011)1.
Summing up, we propose the following green business denition: green business is
an organization that is committed to the principles of environmental sustainability in its
operations, strives to use renewable resources, and tries to minimize the negative envi-
ronmental impact of its activities. In this perception, “greening” of business is part of a
long-term strategy of becoming sustainable, i.e. being able to achieve business tasks in
the way that does not develop any threat – economic, social or environmental – for both
current and future generations.
Business greening agents
The shift of business to the green trend can by no means be attributed exclusively to the
initiatives of business itself. One can distinguish three main agents of the process: con-
sumers, governments, and business itself, each of them in its own way contributing to the
formation of “green request” to business and/or green practices2.
Green consumer. To place “green” products in the right market position, it is impor-
tant to determine who the consumers of these products are. A green consumer can be
dened as an individual who purchases ecologically produced or eco-friendly products
(i.e. those that are made, imported and traded without causing pollution, can be reused
or utilized) and avoids environmentally harmful consumption (e.g., by saving water and
1 Strictly speaking, the laws of thermodynamics preclude the possibility of business activities with no negative
impact on the environment.
2 Geographical position also affects business ability to be “green” – the advantage is to have natural energy
resources (wind, swash or geothermal) within the country and to be able to use them for electricity or heating.
77
energy, recycling). The literature provides different lists of the characteristics that dene
green consumers. Some authors distinguish four types of consumer characteristics – de-
mographic, socio-economic, psychographic, and behavioral (Kotler et al., 2005), while
others denote ve types – demographic, knowledge, values, attitudes, and behavior
(Laroche et al., 2001). Still others name habits, personal capabilities, values, beliefs
and norms as the most important green consumer characteristics (Jansson et al., 2010).
The environmental marketing research has not provided consistent results concerning
relationships between the particular consumer characteristics and the environmentally
friendly behavior and does not support the idea of a “typical” consumer involved with
environmental issues in either non-purchase conservation behavior or in green purchase
consumption pattern.
The consumer’s main demographic characteristics are age and gender. Research con-
ducted in 1996 indicated that a green consumer was older than the average, while other
research done several years later, in 1999, have produced the exactly opposite result –
younger than the average (Getzner, Grabner-Krauter, 2004). In terms of gender differ-
ences, some studies have led to the conclusion that females are more environmentally
aware, while others found males to be more inclined to pay extra money for a green
product. Then again, some studies did not indicate any signicant relationship between
green consumption and gender (Laroche et al., 2001).
As regards consumer’s socio-economic characteristics (income and education),
Sandahl and Robertson (1989) have reported that people with a lower income and educa-
tion level tend to be more inclined towards green consumption. This conclusion has been
conrmed by a later research (Jansson et al., 2010) and indirectly by studies that failed
to nd any positive correlation between green consumption and high household income
or education level (Laroche et al., 2001).
Most researchers conclude that demographic variables have the least inuence on the
green shift in the consumer’s opinion, and that psychographic characteristics knowl-
edge, attitudes, and values are more helpful for understanding the ecologically friendly
consumer behavior. The knowledge of environmental issues is also known as “ecolitera-
cy”. Examination of inuence on consumer behavior leads to controversial conclusions.
Several studies have shown that there is a signicant link between consumers behavior
and environmental knowledge, while others have conrmed the opinion that knowledge
is weakly related to green purchases (as reported by Getzner, Grabner-Krauter, 2004;
Laroche et al., 2001). The decision to “go green” is strongly inuenced by the attitudes
of importance and convenience. Firstly, individuals’ cognition of environmental prob-
lems must be important for themselves, and secondly, “going green” should not be per-
ceived as inconvenient in terms of lifestyle changes or additional costs (Laroche et al.,
2001). Moreover, the behavior is inuenced by habits, thus adding the attitudinal factor
78
to the actual behavior (Jansson et al., 2010). Two major values that inuence individuals’
environmental behavior are individualism and collectivism. Individualists tend to com-
pete with others and usually pay no attention to the public benet of their actions. On the
contrary, collectivists try to make the environment better for everyone and pay attention
to other people’s attitudes (Jansson et al., 2010).
Environmentally aware consumers can, again, act either individually or collectively.
The individual green behavior manifests itself in personal decisions whether to act in a
green way (e.g., recycle) and to pay more for a green product, or not. Collective action
is taken through associations – non-governmental associations (NGOs) which in turn
contribute to fostering the environmental awareness of the general public. Furthermore,
by rising concerns about the harmful effects of particular industrial activities and pro-
moting environmentally safe practices, NGOs exert a social pressure on businesses and
governments.
Government role. Recognizing the impact of human actions on the environment and
acting under pressure from consumers (voters) and various NGOs, governments (local,
national or supranational) provide a regulatory framework for business operations, aim-
ing to restrict the environmentally harmful and to prompt the environmentally friendly
business behavior. Examples of such legislations and policies are environmental taxa-
tion, green public procurement, integrated product policy, eco-labeling, eco-auditing3.
The green public procurement requires companies to meet certain environmental per-
formance standards (e.g., ISO 14000) in order to be eligible to work for and with the
government. At the EU level, the green procurement specication is established for the
following products or service groups: construction, transport, copying and graphic pa-
per, cleaning products and services, ofce IT equipment, furniture, electricity, food and
catering services, textiles, and gardening (Buono, 2011). The integrated product policy
is a comprehensive instrument for minimizing the environmental degradation which
arises from the use, disposal or manufacturing of products. The list of tools includes
certain substance bans, product design regulations, environmental labeling (e.g., the EU
Ecolabel, an ofcial EU mark awarded to products with a reduced impact on the environ-
ment through its all life cycle4). Other examples of government-supervised eco-labeling
schemes are the EU Energy Label where all European manufacturers have to inform
consumers about the energy efciency (rated from A to G) of household appliances,
LEED (Leadership in Energy and Environmental Design), the Green Building certicate
awarded in the U.S.A. to the environmentally responsible constructions which efciently
3 For a detailed comparative analysis and application practice survey, see Compton et al., 1998, 1999; Rietber-
gen–McCracken and Abaza, 2000).
4 The EU Ecolabel, http://ec.europa.eu/environment/ecolabel/
79
use energy, water, other materials and ensure indoor environmental quality5. Mandatory
labeling requirements also exist for food, drinks, and pharmaceutical sectors6. Eco-
auditing tools are designed for an objective and systematic evaluating, reporting and
improving companies’ environmental performance (e.g., the EU Eco-management and
Audit Scheme – EMAS7).
Business: going green
Becoming green is a multifaceted process; there are various practices that can be applied
when business wants to shift to a green behavior. Broadly speaking, an environmentally
aware business should participate at least in one of “4Rs” – reduction, reuse, recycling,
and recovery (Kassaye, 2001). Each
of those “Rs” can be achieved through
several practices, some of which might
serve the purpose of more that one “R”.
Figure 1 presents a non-exhaustive
scheme of commonly employed green
business practices.
“R” as reduction has a twofold
meaning: as a reduction of resource
consumption and a reduction of waste.
A typical example of the rst type of
practice is the reduction of energy con-
sumption, e.g., by replacing incandes-
cent lamps with energy-efcient com-
pact uorescents bulbs which enable to
save up to 75% of energy, or simply by
turning off electronic appliances when they are not in use. In order to save trees, some
companies recommend printing on both sides of paper or to print only the main docu-
ments. Application of green packaging might serve either one or both goals of reduction:
some companies minimize the volume and weight of packaging (e.g., Campbell Soup),
while others (e.g., Sears) strive to reduce packaging waste. Some companies (e.g., Whole
Foods Market, Revlon, Estee Lauder) have started using degradable, natural or organic
ingredients for their products. Companies might also apply the “product stewardship”
policy. It means that the manufacturer is responsible for waste reduction, recycling,
5 Green Building, <http://www.greenbuilding.com/knowledge-base/energy-green-building>.
6 Quite a few eco-labeling schemes are initiated and supervised by the NGOs or business sector, not by govern-
ment. These are discussed later in this paper.
7 EMAS, <http://ec.europa.eu/environment/emas/about/index_en.htm>
FIG. 1. Green business practices
Source: Compiled by the authors.
80
and the use of renewable materials. This comprehensive (in terms of “4Rs”) practice
is known to be employed, for example, by McDonalds8 and the Whole Foods Market9.
The Ecolabeling (also known as green or environmental labeling, or green brand-
ing) seeks to take advantage of market forces by providing consumers with informa-
tion about products’ environmental prole, e.g., about their environmentally harmless
manufacturing and residual disposal processes, recycling potential, consumption quality
(Lavallee, Plouffe, 2004). The benets of providing this kind of information to custom-
ers are several: consumer attraction, public standing, brand awareness, and improvement
opportunities. Consumer attraction implies that by informing consumers on the environ-
mental benets of products, the business can rouse the consumer’s interest in eco-issues
and develop a purposive demand for a particular type of articles. The public standing is
enhanced by the use of environmental labels as tools to demonstrate a company’s cor-
porate social responsibility to consumers, general public, partners and regulators. Green
brands appeal to those who prioritetise “going green” and hence offer a competitive eco-
advantage by raising the brand awareness of both retail consumers and B2B customers.
Finally, ecolabeling compels to take care of the environmental prole of the product
range and thence offer improvement opportunities that may help to cope with the new
environmental legislation when it is introduced.
There are two ways of setting a voluntary ecolabel: it can be self-declared or obtained
through the already existing environmental labeling scheme. A self-declared environ-
mental label is considered to be a declaration, a label or a symbol which draws attention
to a certain element of the organization’s activities, products or services that can inu-
ence the environment. Such claim (e.g., “Contains no Es!”) can appear on the product or
packaging itself or in any associated marketing materials. It can be issued by any party
that might benet from such declaration – producers, importers, distributors or retailers.
The parameters intended to prove the product’s environmental friendliness are chosen
by the company itself. Another option is to use the existing ecolabeling schemes, such
as Mobius Loop, Green Dot, Fairtrade, Marine Stewardship Council, and the like10. This
way might save both time and costs pertinent to building a new eco-label, another ad-
vantage being that such schemes, being operated on a not-for-prot basis, are viewed as
more trustworthy than claims of a commercial concern. From the nancial side, all of the
8 McDonalds, Greener than Ever. <http://www.mcdonalds.com/us/en/our_story/values_in_action/greener_
than_ever.html>.
9 Whole Foods Market, Green Mission, <http://www.wholefoodsmarket.com/values/green-mission.php>.
10 Mobius Loop is an internationally recognized universal recycling symbol used to denote goods that are either
recyclable or contain a recycled component. Green Dot (aka Der Grüne Punkt) is a system of packaging that indicates
that the manufacturer of the product contributes to the cost of recovery and recycling. The Fairtrade mark stands for the
guarantee that food and beverage producers in developing countries receive a fair price which can cover their costs, as
well as indicates some contribution premiums for producers through investment in the provision of clean water, health
care, the environment, and education for their communities. The Marine Stewardship Council certies that its labeled
seafood comes from and can be traced back to a sustainable shery. For details, see (Thomas, 2007).
81
labeling schemes carry the costs of adjusting operations, auditing and communication to
customers about what it is and what does it represent. The positive part is related to an
increased protability when carrying that label.
There are also a number of “minor” green actions that still can contribute to the
greening of business. For instance, some companies encourage their employees to use
public transportation instead of their own cars in order to reduce air pollution, or to
refuel the car after 6 p.m. when the gas fumes reputedly are less harmful to the environ-
ment (Collins, 2008). Other “green” practices include waste sorting, organizing seminars
about “green business” and environmental protection, the rule of not smoking in the of-
ce, etc., and participation in environmental actions. It should be noted that the number
and specics of the green business actions adopted by companies depends on a particu-
lar business’s abilities to those change its operations to environmentally friendly. There
might be reasons which preclude a business from “going green”. For instance, compa-
nies simply might not know how to become green or regard “greening” as an expensive
fancy that drains away resources and diminishes prots.
What is it to be green?
While it is true that business greening usually necessitates certain additional costs, it
also might bring tangible commercial benets and lead to an increased protability. A
business can reap two types of benets by “going green”: one is revenue rising, and the
other is cost saving.
The revenue rising benet can be derived from product differentiation and brand im-
age, customer communication, additional value and higher productivity (Collins, 2008;
Swallow, 2009; Laroche et al., 2001). By going green, a business distinguishes itself from
others and gains a competitive advantage. It is well known that customers buy a product
not only as a commodity but also the image links of the product. A green brand is one that
appeals to the retail consumers and B2B customers who favor greener products and ser-
vices (Hartman et al., 2005). Consumer willingness to pay more for a green product in-
dicates that consumers perceive an additional value in it. However, a green brand should
be effectively communicated or, in other words, marketed in order to be recognized by
consumers. Green marketing (also known as sustainable marketing, organic marketing,
and environmental marketing) usually refers to the product, service or lifestyle which
it is promoting, rather than to a method of marketing itself. It centers on consumers’
explicit or implicit willingness to pay more for environmentally friendly products and
is about selling environmentally safe or said to be safe products11. Likewise, according
11 A product or service is perceived as “green” because someone can sell it as such, not because it is such. How-
ever, if a company unduly exaggerates green marketing, its green image could be perceived as a “green washing”
(Kangis, 1992).
82
to (2008), employees that work for green companies are more satised with their work
and show a higher productivity. Finally, by becoming green, a company can secure better
future prospects in terms of networking with the other green businesses that are willing
to have partners of the same inclination.
Cost saving is mainly generated by waste utilization and input sparing. Such prac-
tices as heat generating by waste incineration, cutting down the paper use in exchange
for electronic communication, turning off electronic appliances when they are not in
use and the like provide possibilities to save costs. Furthermore, it is believed that green
business practices make workplaces healthier and safer, thus enabling a company to cut
spending on employees’ sick time.
Case study: green business trends in Lithuania and Ireland
An empirical survey was carried out by the authors in 2012 in order to identify, contrast,
and compare green business trends in Lithuania and Ireland, i.e. a newly emerged vs. a
well established market economy. The questionnaire consisted of forced-choice ques-
tions divided into three sections: the rst section was designed for the specication of
the company (operating eld, size, turnover, etc.) and identication whether it perceives
itself as green or not; questions in the second section prompted green companies to re-
veal their reasons for becoming green and to indicate “green” practices used both in the
micro-environment (inside the company) and on the macro level (related to the public
standing of the company), and the third section was dedicated to non-green companies,
with an attempt to establish the reasons why they do not follow the green trend and to
nd out their intentions for the future. The ve-point semantic differential scale (the val-
ues ranging from 1 for “never” and “strongly disagree” to 5 for “always” and “strongly
agree”) was used for the construction of questions in sections two and three. The re-
quired sample size was calculated to be 100 companies per country. The survey analysis
was based on 207 responses: 102 in Lithuania and 105 in Ireland12. The distribution of
the surveyed companies by sectors and annual turnover was similar for both countries.
The chi-square, one-way ANOVA, a paired-sample t test, Spearman and Kendall’s tau-b
tests were used for the analysis of the collected data in order to check the importance of
statements and their correlation as well as the relation between statements and the com-
pany’s characteristics.
The dichotomous lter question (“Is your company operating as “green”?”) has
revealed that 55.88% of the surveyed Lithuanian companies count themselves as “green”
12 The questionnaire was distributed either by e-mail or directly handed to 115 companies in each country; 23 of
the received responses (13 from Lithuanian and 10 from Irish companies) had to be disregarded due to an incorrect
lling of the questionnaire. The list of companies surveyed in Lithuania inter alia included Alna, Arginta, Lesto, and
in Ireland AVIVA, Pzer, Intel, Tesco, Xerox.
83
and 44.12% as “non-green”, the situation in Ireland being a kind of a mirror image with
45.71% and 54.20%, respectively. However, the ranking of the used green practices on
a ve-point semantic differential scale (with 1 standing for “never” and 5 for “always”)
has indicated that on the average Irish “green” companies are more actively engaged in
business “greening” that Lithuanian ones, the average ranks of their green practices be-
ing 4.19 and 3.69 respectively. Furthermore, 58% of the surveyed presently non-green
Irish companies planned switching to “green”, while in Lithuania this move was con-
templated by only 23%.
The most popular internal “green” practice for the Irish companies was no smoking
in the ofce, while Lithuanians gave the highest signicance to switching off computers
when leaving the workplace (Fig. 2). In both cases, the paired-sample t test has indicated
signicant differences of these two practices from other statements. An analysis of the
preferred green actions by the sector (Fig. 3) revealed that no smoking in the ofce was
uniformly “voted” by all sectors in Ireland as being the most popular type of “green-
ing” a company’s micro-environment. The Lithuanian side was not that homogeneous,
with manufacturing companies giving a higher preference to recycling and switching off
lights when leaving the workplace for at least 15 minutes. This notwithstanding, the one-
way Anova test has revealed no statistically signicant relation between a company’s
activity eld (sector) and employed green policies in neither of the country.
Analysis of relationships between employed green practices and companies’ turnover
led to rather inconclusive results. Irish companies with the annual turnover up to 7 mil.
euros on the average have shown the least enthusiasm for the greening of their business,
with the lowest ranks given to relatively more sophisticated green practices of recycling
and “ofce without paper” and the highest to the least costly option of no smoking in
the ofce. While the Spearman test has indicated a positive correlation (Sig. (2-tailed) is
.027 < 0.05) between turnover and recycling in the Irish companies, it was rather weak
(0.319). Otherwise, no signicant relation was found between adoption of a particular
micro-environment “greening” practices and annual turnover for Irish companies. The
same conclusion fully applies in the Lithuanian case as well. However, the further analy-
sis of Lithuanian data yielded several quite surprising results. Namely, in Lithuania, the
average propensity for business “greening” diminishes with the growth of annual turno-
ver. Furthermore, contrary to the Irish case, in Lithuania such practices as recycling and
“ofce without paper” scored the highest ranks in the segment of companies with the an-
nual turnover of up to 7 mil. euros. However, the most popular green measure across all
segments of annual turnover was switching off computers and electronic devices when
leaving the workplace.
Analysis of responses concerning the environmentally friendly policies applied by
companies on the macro level, i.e. carried out externally and designed to consolidate
84
the public standing of the company, revealed further conspicuous differences between
the two countries (Fig. 4). The preferred green policies on the macro level for Irish
companies are the provision of nancial support to environmental projects and support
of environment-friendly projects carried out by students. Interestingly, such an easy and
cheap option as organizing a day without a car in Ireland got the lowest rank, and the
paired-sample t test has conrmed that it is signicantly less important than support-
ing environmental projects. The Lithuanian companies notably prefer low-cost business
“image greening” options, such as organization of or participation in seminars on green
a) b)
FIG. 2. Preferences for internal green actions in (a) Irish and (b) Lithuanian companies
Source: Survey conducted by authors.
a) b)
FIG. 3. Preferences for internal green actions in (a) Irish and (b) Lithuanian companies by sectors
Source: Survey conducted by authors.
Mean
Mean
5
4
3
2
1
0
5
4
3
2
1
0
Remov-
ing extra
devices from
computers
when they
are not
used
Switch-
ing o
computers
when
leaving
workplace
Switching
o lights
when
leaving
workplace
at least for
15 min
Recycling Introduced
"oce
without
paper"
system –
printing
only when
necessary
No smoking
in the
oce
Remov-
ing extra
devices from
computers
when they
are not
used
Switch-
ing o
computers
when
leaving
workplace
Switching
o lights
when
leaving
workplace
at least for
15 min
Recycling Introduced
"oce
without
paper"
system –
printing
only when
necessary
No smoking
in the
oce
Removing
extra de-
vices from
computers
when they
are not
used
Switch-
ing o
computers
when
leaving
workplace
Switching
o lights
when
leaving
workplace
at least for
15 min
Recycling Introduced
"oce with-
out paper"
system
– printing
only when
necessary
No smoking
in the
oce
Removing
extra de-
vices from
computers
when they
are not
used
Switch-
ing o
computers
when
leaving
workplace
Switching
o lights
when
leaving
workplace
at least for
15 min
Recycling Introduced
"oce with-
out paper"
system
– printing
only when
necessary
No smoking
in the
oce
Mean
Mean
Manufacturing Distributing Retailing Providing
services
Manufacturing Distributing Retailing Providing
services
85
business and environmental issues, with a “day without car” initiative trailing close be-
hind. The signicance of this preference over other alternatives was conrmed by the
paired-sample t test as well.
While in most cases no obvious correlation was found between a company’s annual
turnover and disposition towards external green practices in either country, in both cases
it were the richest companies operating on a scale exceeding 138 mil. euros in terms of
annual turnover, which were most concerned about their environmental public standing.
It is interesting to note that in Ireland the “day without car” action was deemed as of low
importance or, shall we say, a low public-impact alternative even among small-scale
companies, i.e. with the annual turnover up to 7 mil. euros, while the most costly option,
(nancial support to environmental projects) was the ranking winner in all segments of
the turnover. The Lithuanian preferences, as revealed by the survey, follow a different
pattern: the smaller the company, the higher preference it gives to the “day without car”
type of action and, predictably, is more reluctant to give money away to support envi-
ronmental projects.
Summing up the revealed patterns, it can be concluded that Lithuanian companies are
generally more concerned with the costs than benets of becoming “green”. This is indi-
cated by their rather obvious inclination towards the use of low-cost “business greening”
options, especially as far as the public image of a company is concerned. Meanwhile, the
Irish companies opt for a more expensive but at the same time more publicly visible ac-
tions, such as providing nancial support to environmental projects. It can be presumed
that such a striking difference between the business attitudes in Ireland and Lithuania
not only characterizes the different levels of business commitment to the green ideas, but
also reects the cultural and economic differences of the two societies. In an emerging
a) b)
Fig. 4. Preferences for external green actions in (a) Irish and (b) Lithuanian companies
Source: Survey conducted by authors.
Manufacture
ecological products
Organize a “day
without car” action
Company supports
environmental
projects nancially
Supports students'
environmentally
friendly projects
Organize / participate
seminars about
environmental issues
Organize / participate
in seminars about
green business
Mean
4
3
2
1
0
Mean
4
3
2
1
0
Manufacture
ecological products
Organize a “day
without car” action
Company supports
environmental
projects nancially
Supports students'
environmentally
friendly projects
Organize / participate
seminars about
environmental issues
Organize / participate
in seminars about
green business
86
economy like Lithuania, which is eager to catch up economically as fast as possible with
the highly developed countries like Ireland, in the average consumer’s perception the
economic issues hold a relative priority over the environmental ones, i.e. the lower cost
of commodity is more important to the consumer than the fact that the commodity was
produced by a “green” company. These consumer attitudes and the market competition
inevitably shape business attitudes as well, prompting them to look for low-cost options
of being “green”.
One might wonder why to be “green” at all, then? The hint to the explanation was
given by the survey: when asked about the sense of being “green”, the second by popu-
larity answer of Lithuanian companies was “it is a must nowadays” (mean, 3.51), with
“it is a new fashion tendency” (3.33) trailing close behind. This essentially indicates
that business ”greening“ in Lithuania is still prevalently based not so much on sincere
environmental awareness and consciousness as on the “join the crowd” notion. On the
other hand, the highest rank among the motives of becoming “green” in Lithuania got
the intention to satisfy environmentally-oriented customer’s needs (mean, 3.84), what
could be taken as an indication of the dawning realization that being “green” opens new
revenue-raising opportunities. The cultural and business mentality differences are fur-
ther demonstrated by the responses of the Irish companies to the same question about the
sense of “green business”: both statements that were popular in Lithuania (“it is a “must”
nowadays” and “a new fashion tendency”) got the lowest ranks in Ireland (mean, 2.70
and 2.91, respectively). Instead, Irish companies prevalently saw business “greening”
as a relatively cheap possibility to increase the turnover (mean rank, 3.25); exactly the
same statement was ranked least favorably by Lithuanian companies (mean rank, 2.47).
On the other hand, several similarities in the attitudes were observed as well. For in-
stance, while no statistically signicant relation between the annual turnover of a compa-
ny and the statements was found either in the Lithuanian or in the Irish case, it was noted
that in both countries the tendency to regard business “greening” as just a new fashion
is the strongest among the small-scale companies and the weakest among the large ones.
Another similarity is that both Irish and Lithuanian non-green companies have selected
the costliness of switching to green as the main explanation for not operating as “green
businesses”. However, it is interesting that with the turnover increase this type of expla-
nation looses its importance in Ireland and, rather surprisingly, gains in Lithuania.
Conclusions
As demonstrated by the review of “green business“ denitions, the substance of the
concept is still rather fuzzy, ranging from the equation of it with the broader notion
of “sustainable business” to the rather narrow accentuation of some “green” feature of
production, e.g., the use of renewable resources. The suggested denition of “green
87
business” as an organization committed to the principles of environmental sustainability
in its operations striving to use renewable resources and trying to minimize the nega-
tive environmental impact of its activities allows to distinguish, but not to dissociate,
“green business” concept from the broader term of “sustainable business”. The shift of a
business to the green trend should be regarded as the outcome of the interaction of three
main agents of the process: consumers, governments, and the business itself, the rst two
contributing to the formation of “green request” to business and the latter implementing
green practices. The uneven proliferation of green business practices in the world can
partly be explained by the aforementioned ambiguity of the concept itself and, what is
even more important, by the cultural, political and economic differences of the countries.
The latter hypothesis was conrmed by the results of a survey carried out in Ireland and
Lithuania – the countries that markedly differ by the level of economic development and
by their sociopolitical context. While the potential advantages of business “greening” in-
clude both the revenue raising and the cost saving, Lithuanian companies are obviously
more concerned with costs than benets of becoming “green”. Meanwhile, Irish compa-
nies have demonstrated a better awareness of the fact that being “green” opens new rev-
enue raising opportunities. However, the survey has also indicated that in both countries
reluctance to enter the “green” path is prevalently caused by the qualms that such move
might be too costly. The survey has also produced some rather surprising ndings, e.g.,
that for Lithuanian companies the average propensity for business “greening” dimin-
ishes with the growth of annual turnover. This observation calls for the further research
of “green” attitudes and their determinants in the Lithuanian business environment.
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