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CORPORATE ENVIRONMENTAL POLICIES

There is a general consensus that companies implementing a good environmental policy are typically rewarded by the market with higher valuations and tend to be more successful. Economic, social and environmental progress are being directly connected to one another with the broader understanding that sustainable development is the collective responsibility of government, businesses, and individuals. Additionally, when these groups are informed they are less likely to conduct business with others whose products and practices do not meet their environmental expectations and concerns.

Corporate environmental policies have internal and external components. Both components should be implementable, flexible, incorporate best practices, and manage risk with a commitment to the environment and sustainable development. According to the Ethical Investment Research Service (EIRIS), a corporate environmental policy should include applicable corporate issues, realistic objectives, responsibilities, and performance monitoring.

The external component is the public side of the policy and is prepared for public and investor relations promoting corporate citizenship and environmental stewardship. The exterior policy may be as simple as a brief published statement; for example, on the company’s web site or in the annual report. However, the external policy should be developed to the fullest appropriate context of the company and will be directly linked to the internal policy.

The internal component addresses how and with who the company will conduct business. It should cover in detail specific policies and procedures to manage risk, green practices, implementation and training, responsibilities, metrics, objectives, and performance monitoring and review. Corporate culture, economic stature, market perception and risk management typically provide the framework for the preparation of the policy. However, policy preparation may include additional input from corporate interviews, focus groups, and surveys as well as relevant market and technical supporting data.