The Business Environment And PESTLE L3

The Business Environment:
Sustainable Development and PESTLE

The Business Environment: Sustainable
Development & PESTLE
Lesson Plan
Activity
Presentation

Tutor Notes:
Resources: PowerPoint Presentation (available on the Sustainable Skills website http://www.lgec.org.uk/Projects/Sustainable-Skills-Project

Background reading –
 Sustainable Development – A
Quick Guide
 ‘Sustainable Development and
PESTLE Analysis: The Business
Case for doing the right thing’
 PESTLE and the 5 Capitals

Before starting the activities it would be really useful for the students to read the three handouts listed opposite. This will give them a starting point for the following activities.

Activity 1: Ethical Logos



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Students to identify the logos that they recognise and identify the types of products these logos would be found on. Students should make a list of products for each logo
The students should then rank the logos according to which ones they think are the most sustainable - giving reasons for their decisions. Finally for this activity the students should discuss why businesses would want to attain these ethical standards

Resources: Logo Sheet and logo cards
Activity 2: SD Brainstorm

The students should work in groups and each group is given one of the following industries:
 Chocolate company
 Fashion retailer
 Bank
 Fast food retailer
 Car manufacturer
 Supermarket chain
The students will then identify as many ways as they can how their business impacts both positively and negatively, on the three areas of sustainable development (environment, economy and society)
Resources: ‘Identifying the impact business has on Sustainable
Development’ handout

Activity 3: Case study Analysis

This activity can be done individually. Using the three case studies from organisations that are signatories of the Global Compact, the students must read each one and then summarise them focusing on:
 The challenge
 How the company addressed the challenge
 What the benefit(s)were for the company
Resources: Case study handouts

Activity 4: News Article Analysis

The students could work either in pairs or individually to do this activity.
They are to be given two articles – one short article and one more in depth article per pair or per individual and they need to read through each one carefully and then complete the PESTLE analysis table identifying the external factors that have affected each of the companies or industries mentioned in the article and the implications for the company of these factors.
Resources: News article selection and ‘PESTLE News Article Report’ handout Activity 5: SD in the PESTLE

Students work in the same groups that they were in for Activity 2 and keep the same industry that they were working with in activity 2.
Considering this industry they brainstorm as many sustainable development issues that may have an effect on their organisation and they decide where in a PESTLE analysis these points would appear.
It may be helpful for the students to refer back to the brainstorm that they did in activity 2.
Resource: ‘Linking Sustainable Development issues with the PESTLE’

Continuation activity

Produce a poster summarising the information in the handout
‘Sustainable Development and PESTLE Analysis – The business case for doing the right thing’
Resources: ‘Sustainable Development and PESTLE Analysis – The business case for doing the right thing’
Handout.

Sustainable Development – Quick Guide!
So what is sustainable development?
There are literally hundreds of different definitions of sustainable development; however the most popular one is that sustainable development is:
“Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”
The Brundtland Report 1987
Sustainable Development is broadly considered to have three main elements, and can be considered to work like a three legged stool.

The World

Economy

Society
Environment

What would happen to the stool if you took one of the legs away?
Please note: Although all three elements are very important, the environment underpins everything and ultimately we rely on it to sustain our lives. We can impact and adapt the environment; however we have the power to actually create our economic and social systems. The Five Capitals Model
Another way of looking at sustainable development is to use the ‘Five Capitals’ model.
This basically expands on the idea of the three legs model above. If you think of each
‘capital’ as being like savings in a bank; if you look after those ‘savings’ you will get
‘interest’ or an income from them. However, if you don’t look after the savings then they will dwindle and eventually disappear. The five capitals correspond to the three elements above. The Five Capitals Model and the Flows of Benefits
Dimension
Environment

Society

Economy

Capital
Natural capital: The resources and services provided by the natural world. For example: land, sea, water, livestock, energy, timber, ecological systems Human capital: The energy, motivation and capacity for relationships, and the intelligence of individuals. For example: people’s health, knowledge, skills, motivation.
Social capital: The social groupings that add value to individuals. For example: families, governance systems, voluntary organisation, faith groups, communities, universities.
Manufactured capital: The material goods that exist already. For example: buildings, railways, tools and machines Financial capital: The money, stocks etc. that enable us to put a value on, and buy and sell the above resources

Benefits gained from capital
Energy, food, water, climate, waste disposal.

Energy, work, creativity, innovation, love, happiness.

Security, shared culture, education, inclusion

Living/work/leisure places, access to other resources.
This has no inherent benefit; It is simply a means of valuing, owning and exchanging the other four capitals.

Source: ‘Leadership for sustainability: Making sustainable development a reality for leaders’ Final Research report
(September 2007) Centre for Excellence in Leadership

The Millennium Development Goals
The eight Millennium Development Goals (MDGs) – which range from halving extreme poverty to halting the spread of HIV/AIDS and providing universal primary education, all by the target date of 2015 – form a blueprint for sustainable global change and were agreed to by all the world’s countries and all of the world’s leading development institutions. For more information about the MDG’s go to www.un.org/millenniumgoals The MDG’s are:
1. Eradicate extreme hunger and poverty
2. Achieve universal primary education
3. Promote gender equality and empower women
4. Reduce child mortality
5. Improve maternal health
6. Combat HIV/AIDS, malaria and other diseases
7. Ensure environmental sustainability
8. Develop a global partnership for development

SOCIETY i.e. ensuring the sustainability of society/people

ENVIRONMENT i.e. ensuring the sustainability of the environment
ECONOMY i.e. ensuring the sustainability of the economy and development

Sustainable Development and PESTLE analysis –
The business case for ‘doing the right thing’
The PESTLE analysis is a way for an organisation to analyse its external environment under the six headings of:

A PESTLE analysis enables an organisation to firstly identify relevant external factors to their organisation, secondly decide what impact those external factors may have on their organisation and thirdly work out the relative importance to the organisation of each of these external factors. The organisation can then take this information and use it to influence their organisational strategy. A Changing World
More often these days a business’s external environment is reflecting the issues of sustainable development, and companies have to take this in to account in a much more serious way than they had to in the past.
Consider for instance the demands by governments for businesses to conform to internationally agreed environmental legislation; the rise in the number of Fairtrade and other ethically accredited products now available on our supermarket shelves; the pressure group campaigns and celebrity TV projects highlighting bad business practice and the irresponsible destruction and use of our natural resources, and consider how quickly and easily we can now access this information.
These days people are much better informed about issues and many believe there are higher expectations on how businesses behave. Pressure groups are now much better organised and journalists and documentary makers are more active in investigating and publicising bad business practice.

The internet and other forms of networking media allows very rapid sharing of information around the globe, and there are numerous examples of websites that are devoted to discussing and publicising the behaviour of some of the biggest companies.
In addition to this many big companies today are multinational and therefore operate in many different countries, including many developing world countries: employing people, sourcing products, selling products and services etc. And because of this they have to comply with the different legislation and employment regulations etc. that each of the countries have in place. They also have a responsibility, where legislation and regulations are not as strictly enforced, not to exploit a particular country’s resources or people simply to provide cheap goods in other countries.
Demanding More
In 2010 the Co-operative Bank produced the ‘Ethical Consumerism Report 2010: Ethical
“...growth in ethical consumerism
Shopping through the Downturn’ and their research showed that expenditure on ‘green’ goods and continues to outstrip the market as services had grown by 18% over the previous two a whole. This will come as a years, despite the economic downturn. They revealed surprise to those commentators that the ethical market in the UK was worth £43.2 who thought ethical considerations billion in 2009 compared to £36.5 billion two years could be the first casualty of an earlier. They state that although ethical spending economic downturn” currently remains a small proportion of the total annual consumer spend of some £700 billion, the report clearly shows that growth in ethical consumerism continues to outstrip the market as a whole.
Sustainable Development and PESTLE
There are now numerous ways that companies can show that they are contributing positively towards sustainable development. Many of these initiatives are voluntary but are being signed up to by very prominent multinational companies. One of these initiatives is the ‘Global Reporting Initiative’ which helps to show businesses how they can contribute to the Millennium Development Goals, and as they state in their literature there is a strong case for doing so, i.e.:
1. Investing in a sound business environment: Business works best when operating in stable and secure societies. Benefits include access to a healthy and competent workforce, prosperous consumers and investors, and the existence of open, rule-based, non-discriminatory trading and financial systems.

2. Managing direct costs and risks: Challenges like environmental degradation, disease, conflict and inadequate health and education systems can result in increased costs associated with operational aspects, raw materials, personnel, security, and insurance.
Companies that understand these litigation, market and reputational risks will choose to actively manage them to reduce risks and enhance efficiency and productivity.
3. Harnessing new business opportunities: Developing countries, with large populations and untapped or unexplored resources, present the greatest new market opportunities available for business today. For entrepreneurial companies, achievement of the MDGs means access to greater opportunities around innovation, value creation and competitiveness. Conclusion
So we can see that when a company does carry out its PESTLE analysis it has many relatively new issues to consider, and all companies should in the 21st century be asking themselves the question:
Why should issues of sustainable development and ethics affect how my company does business? For further information about these issues you could look up the following organisations and initiatives:
The Global Compact www.unglobalcompact.org
The Ethical Trading Initiative www.ethicaltrade.org
The World Business Council for Sustainable Development www.wbcsd.org
UN Human Rights Norms for Business www.businesshumanrights.org/SpecialRepPortal/Home/Protect-Respect-Remedy-Framework
World Business and Development Awards www.iccwbo.org/wba/id4032/index.html
International Labour Organisation www.ilo.org
Or read more about sustainability and business on The Guardian’s Sustainable Business webpages at www.guardian.co.uk/sustainable-business

The Business Environment: A Sustainable Development Perspective – PESTLE and the 5 Capitals
SD Element

Environment

Five Capitals
Natural capital: The resources and services provided by the natural world. For example: land, sea, water, livestock, energy, timber, ecological systems.
Benefits gained from capital include: Energy, food, water, climate, and waste disposal.
Human capital: The energy, motivation and capacity for relationships, and the intelligence of individuals. For example: people’s health, knowledge, skills, motivation.

Society

Benefits gained from capital include: Energy, work, creativity, innovation, love, happiness.
Social capital: The social groupings that add value to individuals. For example: families, governance systems, voluntary organisation, faith groups, communities, universities.
Benefits gained from capital include: Security, shared culture, education, inclusion

Manufactured capital: The material goods that exist already.
For example: buildings, railways, tools and machines.

Economy

Benefits gained from capital include: Living/work/leisure places, access to other resources.
Financial capital: The money, stocks etc. that enable us to put a value on, and buy and sell the above resources.
Benefits gained from capital include: This has no inherent benefit; It is simply a means of valuing, owning and exchanging the other four capitals.

PESTLE (Political, Economic, Social, Technological, Legal and Environmental)
Environmental Factors could include:
- The level of pollution created by the product or service
- Recycling considerations
- Attitudes to the environment from the government, media and consumers
- Current and future environmental legislative changes
Political Factors could include:
-Current taxation policy/ Future taxation policy
- The current and future political support
- Grants, funding and initiatives
- Trade bodies
- Effect of wars or worsening relations with particular countries
Social Factors could include:
- Demographics (e.g. size, gender, ethnicity, income, education, occupation)
- Lifestyle patterns and changes
- Attitudes towards issues e.g. education, corporate responsibility, environment etc.
- Social mobility
- Media views and perceptions
- Ethnic and religious differences
Legal Factors could include:
- Legislation in areas such as employment, competition and health & safety, consumer law e.g. Sale of Goods act 1979
- Changes in European law
- Trading policies
- Regulatory bodies
Technological Factors could include:
- Relevant current and future technology innovations
- The ways in which consumers make purchases
- Intellectual property rights and copyright infringements
- Global communication technological advances
Economic Factors could include:
- Overall economic situation
- Strength of consumer spending
- Current and future levels of government spending
- Ease of access to loans
- Current and future level of interest rates, inflation and unemployment
- Specific taxation policies and trends
- Exchange rates

Sources: ‘Leadership for sustainability: Making sustainable development a reality for leaders’ Final Research report (September 2007) Centre for Excellence in Leadership (5 capitals) http://www.marketingminefield.co.uk/marketing-plan/pestle-analysis.html (PESTLE)

Unit 1: The Business Environment:
A Sustainable Development Perspective
‘Ethical’ Logos
Look at the logos below and in your group discuss:
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How many of the logos you recognise?
List the kind of products that you would find each logo on.
Rank these logos in order of sustainability – use a diamond ranking system.
Think of some reasons why companies would sign up to these ‘ethical’ accreditation schemes, what do you think they would they have to do to get these accreditations, and what benefits would they get from having the logo on their products.

Activity 3 Case Study Analysis - - Sustainable Development in
Action
There are now numerous different Sustainable Development initiatives and codes of conduct that business can voluntarily sign up to. One of these is the ‘United Nations
Global Compact’ and has many well-known businesses as signatories including Lego,
Cadbury Schweppes and IKEA.
The introduction to the Global Compact states that:
“Launched in July 2000, the UN Global Compact is a leadership platform for the development, implementation and disclosure of responsible and sustainable corporate policies and practices.
Endorsed by chief executives, it seeks to align business operations and strategies everywhere with ten universally accepted principles in the areas of human rights, labour, environment and anticorruption. With more than 8,500 signatories in over 135 countries, the UN Global Compact is the world’s largest voluntary corporate sustainability initiative.
(Source: Corporate Sustainability in the World Economy United Nations Global Compact)

Some critics may question the ethical standing of some of the companies that are signatories of the compact and query their motives for joining; however some of the changes that companies have made to their business practices are making a real difference in a number of different countries around the world.
For further information about the UN Global Compact go to www.unglobalcompact.org

Activity:
The following case studies from Global Compact signatories show how corporate sustainable development is working in practice. Read each case study and then briefly summarise:  The challenge
 The actions taken
 The benefits of these actions for their company and wider society

Global Compact Case Study – Titan Industries Ltd
Titan Industries Ltd., a member of the Tata Group of companies, is India’s leading producer of watches and jewellery.
Headquartered in Tamil Nadu, Titan Industries manufactures over 8 million watches annually, operates 616 service centres, and exports its products to more than 30 countries around the world. Company Name
Titan Industries Ltd.

Website www.titanworld.com Headquarters
Bangalore – India

Countries of Operation
30

The Challenge
Despite considerable economic growth over the past decade, a large percentage of India’s population remains poor, with limited access to employment and other income-generating activities. Access to employment is a particular challenge for persons with disabilities, which rank among the least affluent in
Indian society. It is estimated that fewer than 1% of the approximately 70 million disabled persons in India are employed, which leads to economic disadvantage, denies rights and limits opportunities for the disabled to play constructive roles in their communities.

Employees
3,000

Sector
Textile, Apparel and Luxury
Goods

Global Compact
Signatory Since
2002

In general, Indian business’ record of providing job opportunities to persons with disabilities has not been excellent. Titan
Industries, however, has taken steps to reverse this job-market bias through numerous initiatives that target persons with disabilities. The Actions
Titan Industries recognizes the important role that the private sector can play in empowering vulnerable population groups. One of the objectives of Titan’s Community
Development Policy initiatives is to improve the opportunities for “differently-abled” people. In implementing this policy, the company identifies persons with disabilities from the surrounding communities in Tamil Nadu and provides them with suitable employment opportunities. Typically, these jobs involve tasks with low levels of bodily risk, a minimum

of required physical movement and/or little need for verbal communication. For example, the physically impaired are given positions polishing watch cases and assembling components, the hearing impaired assembling watches, and the vision impaired working in
Titan Industries’ packaging and despatch division.
In addition to Titan Industries’ strategy of recruiting persons with disabilities, the company also addresses the special needs of its employees once they are on the job. Titan offers special training to enhance their technical competence and computer literacy; it has established non-discrimination policies; and it seeks to create a conducive work environment by creating an ergonomic working area. The company is also offering
“Corporate Social Responsibility is synonymous with Corporate Sustainability and should be embedded in the business planning process. Bringing a smile to the community creates customer affection which, in turn, ensures longterm sustainability” Bhaskar Bhat, Managing Director- Titan Industries-Bangalore, India ( A Tata
Enterprise)

grievance handling and counselling to tackle problems such as exploitation, marital problems and emotional problems that its disabled employees may face.
The Benefits
At Titan Industries, persons with disabilities are accepted as equal members of the workforce and given commensurate opportunities to contribute and earn a decent living.
In its approach, employing persons with disabilities is not philanthropy but a realization that persons with disabilities are an integral part of society and deserve understanding, support and opportunities rather than charity or misplaced compassion.
Currently, Titan employs 117 persons with disabilities (representing 6.42% of its workforce), including those with auditory, physical and visual disabilities. As a result of the opportunities it makes available, Titan believes that the quality of life of these employees has improved to a great extent. The program is also changing the mindset in India regarding the employability of persons with disabilities. Finally, this policy has been a success not only in terms of the positive effects on persons with disabilities but also on
Titan’s bottom line. Persons with disabilities are often more loyal and focused on their jobs and the productivity and quality of Titan’s disabled employees has never been an issue.
Source: ‘An inspirational guide to implementing the Global Compact’

Global Compact Case Study - Lego
Company Name
LEGO Group

Website www.lego.com Headquarters
Denmark

Countries of Operation
30

Employees
4,900

Sector
Leisure Equipment and
Products

Global Compact
Signatory
Since 2003

The LEGO Group is one of the world’s largest toy manufacturers, primarily focusing on construction toys, the famous LEGO© bricks. It was established in 1932 and has since then been dedicated to bring joy into children’s lives through creative play material.
The Challenge
As globalization has increased, the LEGO Group has, as most other companies, begun sourcing their products and manufacturing from all over the world, often from developing countries. This has increased the necessity for the LEGO Group to look at more aspects than usual when finding suppliers to the production. Unfortunately, labour standards are not commonly known and practiced in every part of the world, and suppliers in some countries fail to ensure compliance with key
International Labour Organization (ILO) conventions that specify labour standards. For responsible companies it is not an option to sit back in complacency and risk being accused of complicity in mistreating employees. In addition to cost, quality, and service, companies now have to consider labour practices when identifying suppliers.

The Actions
In 1997, the LEGO Group developed a set of guidelines expressing the minimum requirements suppliers are expected to meet with regard to labour standards, human rights, the environment and anti-corruption. These guidelines are formulated in the LEGO
Group’s Code of Conduct, which is regularly revised – most recently in 2006. Having a code is one thing, ensuring that suppliers are living up to it is another. An audit plan was therefore implemented to regularly check up on supplier implementation and adherence to the rules in the Code of Conduct. Over the years this command and control approach showed limitations. Results did not always live up to expectations.
Clearly there may be structural or cultural conditions that hinder immediate compliance with the requirements. Most importantly, suppliers must be prepared to actively work to eventually comply with the requirements.

New approaches were considered. For some regions, the LEGO Group conducts a precontract assessment of the supplier’s willingness and ability to comply with the Code of
Conduct. If the assessment shows that the supplier is not ready to work on relevant issues another supplier is sought. Some assessments show that the LEGO Group can enter into a contract with the supplier, but there are areas where the supplier should improve their performance (e.g. working hours, overtime pay). In these cases, a LEGO Group employee will visit the supplier and conduct a training session focusing on ways to ensure compliance with the Code of Conduct.
The Benefits
Challenges regarding labour standards are common throughout the toy industry.
Accordingly, the International Council of Toy Industries (ICTI) has taken aggressive steps to ensure that labour standards are taken seriously. ICTI launched the CARE (Caring,
Awareness, Responsible, Ethical) Process in 2005, aimed at ensuring safe and humane workplace environments for toy factory workers. Today more than 1,100 factories representing more than 1 million workers are registered in the CARE Process. The process uses certification and audits to help factories focus on labour standards. The LEGO Group has been an active participant in ICTI and the CARE Process. Through the efforts of CARE participants and the LEGO Group, workers the world over are destined for improved working conditions. The LEGO Group has found that collaborating with suppliers, involving training and dialogue, is an effective means to improving labour conditions. Joining efforts within the industry can help multiply that impact. Improved labour practices in the LEGO
Group’s suppliers’ operations can translate into improved productivity and reduced reputation risks. Improved conditions industry wide can translate into an easier process when the LEGO Group needs to find new suppliers.
Source: ‘An inspirational guide to implementing the Global Compact’

Global Compact Case Study - Petrobras
Petrobras is a Brazilian energy company operating in several areas ranging from oil and gas exploration, refining, and supply through to distribution. Petrobras produces an output of more than 2 million barrels of oil equivalent per day, is a major distributor of oil products and also owns oil refineries and oil tankers.
The Challenges
Many of Petrobras´ products are, due to their very nature and usage, potentially capable of causing air, soil and water pollution. Among risks associated with the oil transporting pipelines are for example leaks caused by damage from a third party. Environmental risks resulting from oil production and transport can cause major impact on the quality of human life in the corresponding region. Some communities surrounding the long stretches of pipelines are categorized as low-income communities, with many inhabitants living below the poverty line. Poor communities are more sensitive to changes and are generally more severely affected by negative impacts due to their limited financial and institutional resources. Company Name
Petrobras

Website www.petrobras.com.br Headquarters
Rio de Janeiro, Brazil

Countries of Operation
23

Employees
62,266

Sector
Oil & Gas

Global Compact
Signatory Since
2003

The Actions
Petrobras is involved in a range of programmes to reduce the possibility of negative impact of its operations. All undertakings that have potential environmental impacts undergo precautionary studies, preceded by viability studies that consider the technical, environmental and social and economic aspects of the project. Using technology, the company obtains information to accurately identify environmentally sensitive areas.
Petrobras seeks to stop the potential negative impact and enhance its positive impact on the communities surrounding the pipelines. In 2005, the company launched the ‘The Agro ecological Family Farming Project along Pipelines Right Of Way (Stretches)’ as a part of the broader Petrobras Zero Hunger Program, designed to improve the living conditions of the low income communities.

Implemented by PETROBRAS TRANSPORTE in partnership with Instituto Terra de
Preservação Ambiental (ONG) and Onda Verde (ONG), the project has two main objectives: preserve the environmental sustainability of the pipelines stretches and provide income and job generation for low income communities in Nova Iguaçu and
Duque de Caxias, municipalities of the state of Rio de Janeiro. The program covers a production area of 96,000 m2 attending directly 100 farming households.
The Benefits
Petrobras recognizes that communities with better living conditions are better equipped to deal with potential consequences of environmental risks. ‘The Agro Ecological Family
Farming Project Along Pipelines’ aims at preserving and improving the quality of human life along pipeline stretches while maintaining the quality of pipeline operations so as to prevent possible damage to the environment, in compliance with the safety and environmental standards.
The project also assists low-income households by providing technical support and financing, to promote social mobilization and participative planning and to create alternative jobs and income generation.
As recognition, the project has won the Social and Environmental Responsibility Award and the Global Award at the International Pipeline Conference & Exhibition 2006 Calgary,
Canada as the most outstanding innovation in the Pipeline Industry.
Source: ‘An inspirational guide to implementing the Global Compact’ (edited)

PESTLE News Article Report
Based on the news article provided, summarise the PESTLE implications below. (News articles can be found at www.lgec.org.uk/Projects/Sustainable-Skills-Project)
Which Industry:

____________________________________________________________

Company / Companies involved: ________________________________________________
External Factors Affecting Organisation

Implications of Factors for Organisation

Political

Economic

Social

Technological

Legal

Environmental

Adapted from PESTLE Analysis resource at www.renewal.eu.com

Activity 5: Linking Sustainable Development Issues with the
PESTLE
In your groups consider the industry that you have been given and identify as many sustainable development issues relating to that industry as you can. Once you have done this, try to identify where in a PESTLE analysis of this industry these issues would feature.
For Example:
Institutional shareholders e.g. pension companies
Arguments from campaigners that ‘bailed out’ banks should not be investing in risky oil projects in case they lose money.

needing continual growth for their funds thus increasing the demand for oil companies to continually find new oil sites, rather than looking into green alternatives to oil

PESTLE Point:
Economic/Political/Social

Increasing pressure from campaign groups and government to invest more money in renewable forms of energy

Oil Company
SD perspective on
PESTLE analysis

PESTLE Point:
Economic/Environment
al
Working in countries with oppressive regimes e.g. Burma etc.
Thus investing in regimes that use money paid to them for dubious items
e.g. armaments etc. as well as links to human rights abuses of workers
(forced labour on oil pipelines etc.).
Risk to companies reputation.

PESTLE Point:
Political/Economic/Social

PESTLE Point:
Economic/Environment
al
With many traditional oil fields running dry, more controversial oil sources are now being considered such as drilling in the Arctic and the
Tar Sands projects – these are not popular with environmental groups/local communities and many campaigns are targeted at them. PESTLE Point:
Environmental/ Social/
Technological
Mining a substance that is blamed for being a major cause of climate change and is ultimately unsustainable. So communities and companies that rely on oil will be increasingly looking into alternatives. (e.g. transition towns) PESTLE Point:
Environmental/Social/Technological

Land rights issues. Indigenous populations contesting the right of their governments in partnership with oil companies to use their land and displace their communities – resulting in demonstrations/legal battles etc.
PESTLE Point:
Social/Legal/Economic

Tutor Notes:
Some points that may arise from this activity could include:
Supermarkets:
 More communities in the UK are fighting planning applications for new supermarkets in their area because of the impact they may have on local high streets shops, increase in traffic etc. (see www.tescopoly.org)
 Competitors increasing the number of Fairtrade/environmentally friendlier products that they sell in their stores
 Studies revealing that ‘ethical consumers’ are likely to be wealthier and more loyal to brands than other consumers, and that the amount of money spent on ethical items is increasing rather than decreasing
(http://www.marketingweek.co.uk/trends/the-only-way-is-ethics/3028974.article)
 Rise in internet shopping potentially leading to a reduction in the number of people travelling by car to their supermarket
 Calls for a ban on free plastic bags being given out
 Greater expectations from governments for big business to cut their carbon emissions in line with national and international targets
 Campaigns from governments for big business and consumers to cut waste to landfill, including initiatives around food waste and what supermarkets can do to support this issues e.g. changes to labelling re sell by dates and rethinking promotions like buy one get one free on perishable items etc. (see www.lovefoodhatewaste.co.uk) Fashion Retailer:
 More fashion retailers selling ethically accredited clothing including Fairtrade and organic cotton etc. Along with calls to use alternative environmentally friendly synthetic materials which can be ‘up-cycled’ (so land and water is not used for growing cotton)
 Pressure groups highlighting bad working conditions for many garments workers in developing world countries including low pay, compulsory overtime, bans on trade unions, inadequate health and safety standards. These workers are often part of sub contracted supply chains

 Competition from retailers to sell cheaper and cheaper items of clothing leading to an increased disposability of clothes which is often referred to as the ‘Primark
Effect’. (30% of waste to landfill is currently textile waste)
 Controversial methods of production e.g. sandblasting techniques for jeans coming under scrutiny from pressure groups due to the detrimental health effects on workers (see http://www.bbc.co.uk/news/magazine-15017790)
 Sourcing of products from the developing world made more appealing due to cheaper labour costs and areas such as Special Economic Zones, often to the detriment of manufacturing in the UK
Fast Food Company:
 Higher rates of obesity and ill health in the UK sometimes being attributed to the fast food industry
 Pressure to sell healthier options
 Criticism of some fast food companies for specifically targeting their advertising at children putting pressure on parents
 Pressure groups highlighting the poor welfare standards of some of the livestock destined for certain fast food outlets
 Some fast food competitors in the UK now sourcing meat from British and Irish farms only so potentially putting pressure on other fast food retail outlets to stop sourcing from overseas (flying meat to the UK and using land in developing world to farm livestock has also been criticised in the past)
 Globally rising food prices – implications for the cost of fast food
 Pressure to reduce the amount of packaging used in fast food and also to use recycled packaging
Car Manufacturer:
 New EU legislation planned to enforce reduced emissions on all new cars manufactured  Price of oil increasing leading to consumers wanting more efficient vehicles
 Consumers becoming more environmentally conscious and wanting more environmentally friendly cars
 Competitors investing more money in developing ‘greener’ vehicles e.g. hybrid, electric and hydrogen

Banks:
 Criticism generally of the financial services sector for the current economic crises which is leading to higher unemployment, poor return on savings and pensions etc. and a general lack of confidence in the sector
 The government bailing out banks with tax payers money – what does that mean for how banks are run and what they invest in? Who has a say?
 In 2010 ethical banking and investments had risen by 23% over 2 years
(www.goodwithmoney.co.uk/ethicalconsumerismreport)
 Who needs investment from banks and how risky are some of the projects? How ethical are the companies that the banks are investing in? Pressure group campaigns highlighting investments in companies manufacturing munitions which are illegal in the UK (see successful campaign to change RBS policy and investments in this area at the AI website)
 Potential for investment in renewable technologies that are being developed – are these going to be as profitable?
Chocolate Company:
 More and more competitors sourcing raw materials from Fairtrade accredited farms  Consumers buying more Fairtrade chocolate
 Retailers selling more Fairtrade and other ethically accredited chocolate
 Pressure groups highlighting some of the poor working conditions on non Fairtrade accredited farms in the developing world including child labour, long working hours, poor pay, forced labour etc.