Economy and ecology - contradiction or necessary unity in times of globalisation

  Economy and ecology - contradiction or necessary unity in times of globalisation  III

Table of contents

Table of  contents  III

  Abbreviation list  IV

1  Introduction  1

1.1  Posing the problem  1

1.2  Intentions  1

1.3  Proceeding  2

1.4  Differentiating the terms economy, ecology and globalisation  2

1.4.1  Economy  2

1.4.2  Ecology  2

1.4.3  Globalisation  3

2  Conflicts between ecology and economy  3

2.1  About the antagonism between ecology and economy  3

2.2  The booming Chinese market as an example for this antagonism  3

2.2.1  Reasons for the environmental problems in China  4

2.2.2  Environmental destruction in China  4

2.3  Global environmental problems  5

2.3.1  Shortage of natural resources  5

2.3.2  Consequences of the global warming process  6

3  Integrating ecology in economy  6

3.1  Political inducements for an ecological production  6

3.1.1  Emissions trading  6

3.1.2  Environmental laws and taxes  7

3.2  Institutional inducements for an ecological production  8

3.2.1  Eco-Management and Audit Scheme (EMAS)  8

3.2.2  International Organisation for Standardisation (ISO)  9

3.3  Social inducements  9

3.4  The “Klaus Steilmann Gmbh CoKG as an example for the successful integration of  

  ecology in economy  10

4  Conclus ion  11

  References  IV

Economy and ecology - contradiction or necessary unity in times of globalisation IV

Abbreviation list

CO2 carbon dioxide DIN Deutsches Institut für Normung e.V. (German institute for standardization) EMAS EU Eco-Manage ment and Audit Scheme e.g. Latin: for instance (exempli gratia) etc etcetera GM General Motors idem Latin : the same ISO International Organization for Standardization

Economy and ecology - contradiction or necessary unity in times of globalisation? Page 1

1 Introduction

1.1 Posing the problem

During the past two decades the impacts of industrial activities on the environment have become a prominent issue in debates on economic development. Nowadays you are almost every day confronted with both ecological and economical problems all over the world. In television and newspapers you are on the one hand faced with hurricanes, global warming and high petrol prices but also with high unemployment rates, insolvencies and rationalisations on the other hand - even concerning global players ¹ like Vodafone or GM.

Not only in your job you are confronted permanently with environmental prescriptions resulting from politics and society but also from your company’s environmental policy. Besides the utilisation of ecological materials in the production lines or the separation of waste throughout the whole firm, more and more companies concentrate on an economical input of natural resources respectively the input of renewable resources. 2

On the other hand every company aims to maximise its profit. Especially in economical difficult times the industrial sector is often even forced to concentrate on operational aims like maximising profit and minimising costs in all respects - also by neglecting ecological issues.

1.2 Intentions

This term paper intends to answer the question if economy and ecology are really contradictory terms or if it is even indispensable to unify them in times of globalisation when the markets are growing together and the competition is getting stronger and stronger. In addition the issue of sustainable development will be described and explained in the course of this term paper, as it is strongly connected with environmental destruction.

The author’s view is on the whole rather economic than operational, although he gives at the end an example of a company which has successfully integrated ecology in economy. Not considered are environmental measures of individuals like saving energy and avoiding waste in their househo lds as well as the potential of ecological innovations in industries.

In fact this work rather wants to expla in why it is nowadays absolutely necessary to integrate ecology in economy by describing the negative consequences for a company as well as for nature respectively for the whole globe by not doing so.

¹ big concerns, which not only contribute to the international market competition as importers and exporters, but also influence the international markets by high capital investments and their important market positions (http://www.wissen.de, 10-17-04)

² compare: http://www.heute.t-online.de/ZDFheute/artikel/8/0,1367,WIRT-0-2128744,00.html, 10-15-04

Economy and ecology - contradiction or necessary unity in times of globalisation? Page 2

1.3 Proceeding

The author starts with general definitions of the terms ecology and economy and will then put these terms in the present context of globalisation by shortly explaining what globalisation actually means. Further on the author enters into the thesis that ecology and economy do not fit together by describing generally the antagonism between economy and ecology. Then he describes, considering as example the booming Chinese market, the consequences of a not sustainable development for nature: on the one side in China, on the other side all over the world - as the problem of environmental destruction does not stop at national frontiers.

After that the writer tries to explain why it is presently often necessary to integrate ecological aspects in the economic production process by pointing out some political, institutional and social inducements for this integration. Considering as example a very successful textile company, the author f inally wants to illustrate the operational advantages of ecology’s integration in the production process.

1.4 Differentiating the terms economy, ecology and globalisation

1.4.1 Economy

Economy is the result of the original conflict between the shortage of goods on the one side and the human beings’ endless needs for goods on the other side. ³ Economy is also the sum of all industrial, retailing and service providing institutions which were created by human beings. Additionally the industrial economy can be seen as a technological ecosystem without the ability of self-regulating, as it completely depends on human actions. 4

1.4. 2 Ecology

Ecology is the study which deals with the relationships between organisms and the ir physical environment like forests, lakes, rivers, mountains, grasslands or moors. ⁵ These ecosystems are selfregulating as long as the natural balance will not be disturbed.

Environmental protection is the summarised term for all measures which protect the balance of these ecosystems like purification of water and air, avoiding waste, minimising the dangers of radiation, etc. 6

³ Seidel/Strebel, 1991, page 7

⁴ idem, page 8

⁵ compare: Seidel/Strebel, 1991, page 39

⁶ compare: idem, page 8