Organizing Sustainable Development

Kuźniarska, Aneta (Ed.); Mania, Karolina (Ed.); Jedynak, Monika (Ed.) Book Organizing Sustainable Development Routledge Open Business and Economics Provided in Cooperation with: Taylor & Francis Group Suggested Citation: Kuźniarska, Aneta (Ed.); Mania, Karolina (Ed.); Jedynak, Monika (Ed.) (2024) : Organizing Sustainable Development, Routledge Open Business and Economics, ISBN 978-1-000-98675-4, Routledge, London, https://doi.org/10.4324/9781003379409 This Version is available at: https://hdl.handle.net/10419/290611 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public. If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc-nd/4.0/ The role and meaning of sustainable development have been recognized in the scientific literature for decades. However, there has recently been a dynamic increase in interest in the subject, which results in numerous, in-depth scientific research and publications with an interdisciplinary dimension. This edited volume is a compendium of theoretical knowledge on sustainable development. The context analysed in the publication includes a multi-level and multi-aspect analysis starting from the historical and legal conditions, through elements of the macro level and the micro level, inside the organization. Organizing Sustainable Development offers a systematic and comprehensive theoretical analysis of sustainable development supplemented with practical examples, which will allow obtaining comprehensive knowledge about the meaning and its multi-context application in practice. It shows the latest state of knowledge on the topic and will be of interest to students at an advanced level, academics and reflective practitioners in the fields of sustainable development, management studies, organizational studies and corporate social responsibility. Aneta Kuźniarska is an assistant professor in the Department of Strategic Management at Jagiellonian University, Poland. Karolina Mania is an assistant professor in the Department of Strategic Management at Jagiellonian University, Poland. Monika Jedynak is an assistant professor in the Department of Strategic Management at Jagiellonian University, Poland. Organizing Sustainable Development Routledge Open Business and Economics provides a platform for the open access publication of monographs and edited collections across the full breadth of these disciplines including accounting, finance, management, marketing and political economy. Reflecting our commitment to supporting open access publishing, this series provides a key repository for academic research in business and economics. Books in the series are published via the Gold Open Access model and are therefore available for free download and re-use according to the terms of Creative Commons licence. They can be accessed via the Routledge and Taylor & Francis website, as well as third party discovery sites such as the Directory of OAPEN Library, Open Access Books, PMC Bookshelf, and Google Books. Note that the other Business and Economics series at Routledge also all accept open access books for publication. Managing Generation Z Motivation, Engagement and Loyalty Edited by Joanna Nieżurawska-Zajac, Radosław Antoni Kycia and Agnieszka Niemczynowicz Higher Education Institutions and Digital Transformation Building University-Enterprise Collaborative Relationships Marcin Lis Routledge Open Business and Economics For more information about this series, please visit: www.routledge.com/Routledge-Open-Businessand-Economics/book-series/ROBE Edited by Aneta Kuźniarska, Karolina Mania and Monika Jedynak Organizing Sustainable Development NEW YORK AND LONDON First published 2024 by Routledge 605 Third Avenue, New York, NY 10158 and by Routledge 4 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN Routledge is an imprint of the Taylor & Francis Group, an informa business © 2024 selection and editorial matter, Aneta Kuźniarska, Karolina Mania and Monika Jedynak; individual chapters, the contributors The right of Aneta Kuźniarska, Karolina Mania and Monika Jedynak to be identified as the authors of the editorial material, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. The Open Access version of this book, available at www.taylorfrancis.com, has been made available under a Creative Commons Attribution-Non Commercial-No Derivatives 4.0 license. Funded by Uniwersytet Jagielloński. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. Library of Congress Cataloging-in-Publication Data Names: Kuźniarska, Aneta, editor. | Mania, Karolina, editor. | Jedynak, Monika, editor. Title: Organizing sustainable development / edited by Aneta Kuźniarska, Karolina Mania, and Monika Jedynak. Description: New York, NY : Routledge, 2024. | Includes bibliographical references and index. Identifiers: LCCN 2023023141 | ISBN 9781032459523 (hardback) | ISBN 9781032459530 (paperback) | ISBN 9781003379409 (ebook) Subjects: LCSH: Sustainable development. Classification: LCC HC79.E5 O747 2024 | DDC 338.927—dc23/eng/20230718 LC record available at https://lccn.loc.gov/2023023141 ISBN: 978-1-032-45952-3 (hbk) ISBN: 978-1-032-45953-0 (pbk) ISBN: 978-1-003-37940-9 (ebk) DOI: 10.4324/9781003379409 Typeset in Times New Roman by codeMantra Contents List of Figures, Tables and Maps ix List of Contributors xiii Introduction 1 PART 1 The concept of sustainable development 3 1 Legal and historical aspects of sustainable development 5 KAROLINA MANIA 2 Sustainable development goals – assessment and relationships 18 ANETA KUŹNIARSKA 3 The economic dimension of sustainable development 33 JUDYTA LUBACHA 4 The social dimension of sustainable development 46 KATARZYNA FILIPOWICZ 5 Environmental sustainability from the perspective of political economy: challenges and hope 63 ZOFIA ŁAPNIEWSKA 6 Multiple perspectives on sustainable development 77 AGNIESZKA ŻAK vi Contents 7 Sustainable development and corporate social responsibility 91 EWA MAZUR-WIERZBICKA AND OLGIERD SWIATKIEWICZ PART 2 Sustainable development organizational function 105 8 Sustainable business management 107 IZABELA STAŃCZYK 9 Sustainable production 120 PATRYCJA ZWIECH 10 Sustainable supply chains 133 MONIKA JEDYNAK 11 Sustainable marketing 146 KATARZYNA WIKTORIA SYRYTCZYK 12 Sustainable servitisation in the automotive sector: an exploratory study 159 DAMIANO PETROLO, LUCREZIA SONGINI, AND PAOLO GAIARDELLI 13 Sustainable HRM 172 GIULIA FLAMINI AND LUCA GNAN PART 3 Forging a sustainable development 187 14 The role of globalization in sustainable development 189 MARCIN GERYK 15 The role of stakeholders in sustainable development 203 MONIKA SADY 16 The role of education in sustainable development 218 JERZY ROSIŃSKI Contents vii 17 The role of innovation in sustainable development 235 MAGDALENA M. STUSS 18 Reporting on sustainable development 246 MAŁGORZATA KUTERA Index 263 xiv Contributors Luca Gnan is a full professor of Organizational Behaviour at Tor Vergata University. He is also Professor Honoris Causa at the University American College at Skopje (UACS). He is the president of the Italian Association for Organization Studies (ASSIOA) and the past president of the European Academy of Management (EURAM). He is a member of the Central Evaluation Committee of the Tor Vergata University and a board member of the Tor Vergata World University. He is and has been involved in various academic and public associations, including Membership of the Education Ethics Executive Committee of AOM (Academy of Management), AOM BPS Division Representative for Europe, AOM OMT Division Research Committee, Vice-President and Executive Director of EURAM (European Academy of Management), Review Board Member of FERC (Family Enterprise Research Conference), Sub-theme Convenor of EGOS (European Group of Organizational Studies) and Stream Chair of CMS (Critical Management Studies). He is also a Scientific Committee Member of the Master on Internationalization “CorCE Fausto De Franceschi” of the Italian International Trade Institute, responsible for Strategy and Organization. Luca Gnan is editor-in-chief of the International Journal of Transition and Innovation Systems and is a guest editor of various journals. Monika Jedynak is an assistant professor at the Institute of Economics, Finance and Management, Jagiellonian University, Krakow. Her scientific interests focus on inter-organizational cooperation, in particular socially responsible cooperation. A new direction of research is the processes of digital transformation of organizations, the formation of digital identity of organizations and the role of social media in these processes. Małgorzata Kutera, PhD, is an assistant professor at Jagiellonian University. She is an experienced academic lecturer in financial accounting, audit, financial reporting standards, tax optimization and creative accounting. She is a certified public accountant (CPA) with 20 years of experience auditing entities’ financial statements from various sectors, including companies listed on EU-regulated markets. Currently, she participates in the work of the Polish Audit Oversight Agency – an institution that controls the activities of statutory auditors in Poland. She is a member of the European Accounting Association (EAA), International Federation of Accountants (IFAC), European Finance Association (EFA), International Association for Accounting Education & Research (IAAER) and the Polish Chamber of Statutory Auditors (PIBR). She conducts consulting and training activities for statutory auditors, financial directors, chief accountants and judges (mainly in the field of economic crimes). The scientific specialization includes financial audit, theoretical and practical aspects of auditing financial statements, the activity of statutory auditors, methodology of verification processes, economic fraud, financial and accounting fraud, intentional manipulations related to creative Contributors xv accounting, tax optimization, activities of tax havens, practical aspects of tax law, financial reporting of enterprises, financial accounting in the national and international perspective, financial analysis and assessment of the condition of enterprises. Aneta Kuźniarska, PhD in Management and Quality Sciences, is an assistant professor at Jagiellonian University, Krakow. Her research interests focus on the topics connected with Human Resource Management (HRM), with particular research in the area of sustainable personnel and green HRM. She is also an academic teacher in full-time studies, part-time studies and postgraduate studies and the author of papers in the fields of sustainable management and HRM. Zofia Łapniewska is an economist and a feminist. She is a senior lecturer at the Institute of Economics, Finance and Management, Jagiellonian University, Kraków, Poland. In the years 2012–2016, she worked abroad as a postdoctoral researcher among others at the Humboldt University in Berlin and the London School of Economics and Political Science, where she conducted research on commons and energy cooperatives. Her current research interests are in feminist and ecological economics. Judyta Lubacha is a researcher and works as an assistant professor in the Department of Economics and Innovation, Jagiellonian University, Krakow, Poland. Her research focused on sustainable development and innovative activities. She is a recipient of many scholarships and research grants: the PRELUDIUM grant financed by the National Science Centre; the DAAD Research Grant for PhD students and young scientists; the Polish National Bank Research Scholarship for PhD students; and the Special Award of the Minister of Regional Development in the competition of master’s theses “Now Poland Promotion”. Karolina Mania, PhD in Law, is an assistant professor at the Institute of Economics, Finance and Management, Jagiellonian University, and she is an attorney-at-law. She received several prestigious research grants: The National Science Centre, The Kosciuszko Foundation scholarship, SYLFF Research Abroad and The Ryoichi Sasakawa Young Leaders Fellowship Fund Program. She is an expert in funding programmes and tenders managed by the European Commission and other EU bodies in the field of Internet law and ODR. Since 2019, she is the President of the Kosciuszko Foundation Alumni Association. She is the author of a monograph on online dispute resolution (ODR) “Internet domain as the object of amicable settlement of disputes” (Wolters Kluwer Polska, 2016) and multiple papers on the use of electronic communication in a legal sector and legal technology. Her field of research includes internet law, e-Commerce, alternative dispute resolution, online dispute resolution, legal management and legal technology. xvi Contributors Ewa Mazur-Wierzbicka is a professor at the Faculty of Economics and Management, Institute of Human Capital Management, University of Szczecin. She specializes mainly in the field of corporate social responsibility (CSR) (with emphasis on diversity management, ethical and equality-related actions), sustainable development and human capital management. She also deals with the issues of soft competences. She is a member of the Expert Forum of the European Institute for Gender Equality, which mandates a period of 01.12.2018–30.11. 2023. She is an expert in the field of CSR – external expert of the Responsible Business Forum. University of Szczecin’s plenipotentiary to the Technical Committee no. 305 for Social Responsibility operating at the Polish Committee for Standardization, advisor of the Polish Agency for Enterprise Development in terms of CSR. She is the initiator and chair of the cycle of seminars and conferences titled “Corporate social responsibility – the management and economy perspective” associating both researchers and business practitioners. She is an expert of the Polish Accreditation Committee and a business consultant. She cooperates with practitioners in the field of management, training companies and institutions. Damiano Petrolo, PhD, is a research fellow at Eastern Piedmont University. He graduated with a PhD in Business Economics from the University of Rome “Tor Vergata” and in Business Economics from Hasselt University. His main research interests include, but are not limited to, professionalization and managerialization in family firms, team dynamics and servitization in the automotive sector. Since 2020, he has been the Communication Officer of the Entrepreneurship Strategic Interest Group (SIG) of the European Academy of Management (EURAM), and since 2021, together with a team of young researchers from the Entrepreneurship SIG, he has been a co-organizer of the EURAM SIG Entrepreneurship Paper Development Workshop Series. Prof. Jerzy Rosiński (PhD) psychologist, PhD and habilitation in management, professor at the Institute of Economics, Finance and Management of the Jagiellonian University, director of the Institute since 2016; Trainer and management consultant with over 25 years of experience. He conducts academic classes and trainings mainly in the field of negotiations, result-oriented communication in the subordinate superior relationship, managing teams in the process of organizational changes, managing teams of specialists and building relationships with clients. He is the author and co-author of books on organizational behaviour, conducting international negotiations, postgraduate training of managers and consumer behaviour. He is the author of over 80 scientific articles in Polish and English, including several articles on competence development, adult development and building competence systems. He is also the substantive editor of Polish editions of books on personnel management, project management and a comprehensive handbook on conflict resolution (Handbook of Conflict). Contributors xvii Monika Sady, PhD, is an assistant professor in the Department of Public Management, and earlier in the Department of International Management, at Krakow University of Economics. She is also a guest lecturer at universities in Spain, France, Georgia and the United States. She is the Head of Social and Environmental Development Unit and the Project Manager of “CUE available to everyone” sponsored by the National Centre for Research and Development, which focuses on university availability for people with disabilities. She is also an International MBA Program Director at the Cracow School of Business. She is the PRME Chapter Poland Steering Committee Plenipotentiary for Sustainability Mindset. She is a member of several European Union international scientific and educational projects in the fields of social entrepreneurship, MOOCs and start-up–corporate collaboration. She has a European Consultant of Social Economy certificate and is a member of numerous national initiatives for sustainable development, social responsibility and climate education. Her research interest lies in management, social responsibility, sustainability, ESG, stakeholder relations, social entrepreneurship, start-ups and lobbying. These are also her teaching, training and consultancy areas. She is a reviewer for several international journals and organizes international scientific conferences. Lucrezia Songini is a full professor in the Department of Sustainable Development and Ecological Transition, University of Eastern Piedmont, where she is in charge of the courses of Servitization Strategy, Managerial Control Systems, Strategic Management in Family Businesses, Cost Management and Performance Management. She is the Rector’s delegate for Third Mission, and Director of the Linguistic Center, the Interuniversity Centre for Studies on Family Business and the Master in Servitization in Automotive Industry at the University of Eastern Piedmont. She is the representative for the University of Eastern Piedmont in the Management Council of the Inter-University Research Center on Innovation and Service Management in Industrial Enterprises. She is an affiliate professor at SDA Bocconi School of Management, a member of the Independent Evaluation Unit of the University of Insubria, an elected Chair of the Country Representatives Council, a member of the Board of European Academy of Management, a past chair of the SIG Entrepreneurship – EURAM, a member of the editorial and review board of the Journal of Management and Governance and an author of numerous publications, with publishers and in journals, both international and national (https://iris.uniupo. it/ – “Songini”). Izabela Stańczyk is a habilitated doctor of economic sciences in the discipline of management sciences and an associate professor at the Institute of Economics, Finance and Management, Jagiellonian University. She has extensive, several years of professional experience in HR in the capital group. The author’s scientific interest focuses on issues related to human resource xviii Contributors management, with particular emphasis on the perception of organizational support, employment shaping, employment restructuring, competence management, personnel consulting and new trends in HR. She is the author of several dozen works containing monographs and articles in this field published in Poland and around the world. Magdalena M. Stuss is an academic and didactic employee at the oldest Polish university. She is an associate professor at the Institute of Economics, Finance and Management. Her scientific interests focus on the areas of human resource management in public organizations and enterprises, employer branding, organization of work in managerial positions, as well as searching for the relationship between human resource management and finance – human capital management in the practice of enterprises and contemporary management concepts. She wrote and participated in writing more than 120 scientific dissertations (scientific monographs, chapters and articles). She has participated in 38 research projects, both domestic and international, and conducted lectures and scientific research in 9 foreign universities. She is also the coordinator, tutor or supervisor within the framework of international programmes for students. Olgierd Swiatkiewicz is a professor at the Setubal School of Technology – Polytechnic Institute of Setúbal, Portugal, and an international expert of the Polish Accreditation Committee. He earned his PhD in Management (Strategy) from Lusíada University of Lisbon; Master of Science in Organizational Behaviour from ISPA – University Institute of Lisbon; and Master of Science in Organization and Management from Warsaw University. Before joining the ESTS/IPS, he was the General Secretary at the Portuguese – Polish Chamber of Commerce and Industry in Portugal; Senior Assistant at CPKPAP – Warsaw; and Research Assistant at the Institute of Industrial Design – Warsaw. For several years, he worked in trade and industry in Portugal and Sweden. He is a member of the EBEN – Portugal, the Learned Society of Praxeology – Poland, ALENE – Associação Latino-Americana de Ética, Negócios e Economia and IAM – Iberoamerican Academy of Management. Katarzyna Wiktoria Syrytczyk is a research and teaching assistant in the Organizational Behaviour Unit, Department of Management and Social Communication, Institute of Economics, Finance and Management, Jagiellonian University. She is a graduate in economics and public administration. She has participated in scientific and research projects and authored research papers. Her areas of scientific interest are issues related to marketing, CSR and organizational culture. Agnieszka Żak graduate of the Cracow University of Economics (MA) and the Jagiellonian University, Faculty of Management and Social Communication (PhD). PhD in economics in the field of management science (2008). Contributors xix Assistant professor, employee of the Department of International Management at the Cracow University of Economics. Director of postgraduate studies in the field of “Enterprise management - MBA management studies” at the Cracow Business School of the Cracow University of Economics (since 2008). Research interests and article topics include: sustainable development, corporate social responsibility (CSR), corporate community involvement (CCI), cross - sector social partnerships, international management, intercultural communication. Social activities: Zaczytani.org Foundation - Coordinator in Krakow (since 2018). Patrycja Zwiech is a professor in the Department of Human Capital Management, Faculty of Economics, Finance and Management, Institute of Management, University of Szczecin. She specializes mainly in socio-economic inequality, gender studies, discrimination in the labour market, business ethics and CSR (especially in social aspects). She is also interested in human capital management. She is a research fellow at the Working Lives Research Institute, London Metropolitan University, and at the Universite Jean Moulin, Lyon 3. She is a contractor in the grant “Development of the competitiveness of the labour market and its entities”, 6th Framework Programme, Marie Curie Action and Development Scheme. She received four individual awards from the Rector of the University of Szczecin for scientific achievements. She is a member of the Senate of the University of Szczecin for the term 2020–2024 and a member of the Anti-Mobbing Commission at the University of Szczecin for the years 2020–2024. She is the initiator and organizer of conference cycles titled “Human capital in enterprise and economy – management and economics” and “Corporate social responsibility – the management and economy perspective”. DOI: 10.4324/9781003379409-1 Introduction Sustainable development is one in which the needs of the present generation are met while considering the needs of future generations. The concept has become increasingly important in recent decades as economic development has accelerated dramatically, leading to ecological imbalances. The philosophy also extends to newer and newer areas of the organization’s functioning. Calls for a change in the approach to economic development appeared as early as 1979 with the Report of the World Commission on Environment and Development: Our Common Future. The coherence of three key elements is necessary for sustainable development: economic growth, social inclusion, and environmental protection. They are interconnected and crucial to the well-being of individuals and societies. A better balance between the mentioned elements is to be ensured by the Sustainable Development Goals (SDGs) set out in the United Nations 2030 Agenda for Sustainable Development. They constitute a step forward in the development of the concept and eliminate some systemic barriers to sustainable development. Sustainable development focuses not only on the environmental dimension. Its task is to meet challenges such as social inequalities, decent working and pay conditions, meeting basic human needs, and peace and justice. In a broader sense, it requires going beyond purely economic issues and considering both: fair working conditions and environmentally friendly production. Sustainability is now an important challenge for companies. Since organizations have a significant impact on economic, social, and environmental issues, the implementation of sustainable development should include cooperation with stakeholders. As such, they face the challenge of developing new ways to create value for and with stakeholders and new ways to implement technical and socioecological changes. Changes in business models are fundamental in the context of implementing innovations for sustainable development. Increasing emphasis on the activities of business entities for sustainable development and the need to inform about the effects of these activities is reflected in non-financial reporting. Various stakeholders, including investors, assess the long-term development potential of enterprises by analyzing this information. 2 Introduction However, there is no standard specifying how to report – these can be short descriptions included in annual management reports or extensive, separate reports presenting very detailed data. Unfortunately, a reliable assessment of this information and its comparison between individual entities, even within the same industry, is very complicated. Identification of this problem leads to intensive work on standardizing non-financial reporting. In light of the rapid degradation of the natural environment, the claim that the company’s goal is only to maximize profit raises serious ethical concerns. The pursuit of profit, regardless of the consequences, harms both the environment and human interests and is contrary to sustainable development. Despite this, many organizations only declare the implementation of the concept and do not implement it in everyday activities. Profit maximization often comes at the expense of customers and the environment. Such an attitude is not only unethical but also against the principles of corporate social responsibility. Although the pro-ecological behavior of large corporations is slightly improving, the ecological awareness of citizens for the restoration of proper relations between nature and the interests of humanity is not sufficient. This monograph is an attempt at a holistic description of the approach to sustainable development and its organization. It contains the characteristics of the elements defining sustainable development and its dimensions in both theoretical and practical aspects. Presentation of the concept in a synthetic way – from a purely definitional approach, through a historical description of its creation and implementation, to elements characteristic of implementation in organizations – is an undoubted value of this book. The advantage of the study is also the participation of many authors, selected thematically adequate to the research they conduct and their areas of interest. The authors come from various research centers in Poland and abroad, which makes the monograph present the issues of sustainable development in a cross-sectional way. The first chapter focuses on sustainable development in historical and definitional terms. The three most important dimensions – social, economic, and environmental – are discussed, which are the pillars of the concept. This section also refers to CSR (Corporate Social Responsibility) as there is a link between these concepts. The second chapter is a transition to the level of organization and socially and environmentally responsible activities that enterprises should undertake. Taking action at this level is a fundamental step toward implementing sustainable development guidelines. The chapter describes, among others, sustainable activities in the field of production, logistics, services, marketing, and indispensable human participation. The third chapter focuses on the environment of the organization. The elements influencing sustainable development described in it, such as globalization, innovation, education, the influence of stakeholders, or multidimensional reporting, are important aspects affecting the way of perceiving, evaluating, and adjusting activities to market expectations. Part 1 The concept of sustainable development 10 Karolina Mania does not have the status of international common law.20 The judgement recognizes that sustainable development is a concept of international law without being normative (Boyle & Freestone, 2001; Nanda, 2005). However, this does not change the fact that sustainable development has gained wide social acceptance and certainly has continued and will continue to exert a significant influence on policy decisions and the choices of decision-makers (Segger, 2009). Sustainable development in the context of European law The principle of sustainable development recognized in international law is also reflected in European law. However, rather than being a distinct feature in the European Union, the notion operates in all policies as one of a more universal nature. This makes it related not only to environmental protection but is treated much more broadly and horizontally. Environmental protection was already included as a legally protected category in the Single European Act, issued on 17 February 1986 amending the Treaty of Rome.21 Within the European Union itself, however, the manifestations of sustainable development can be found in environmental policy, and it is within the framework of environmental policy that sustainable development has become a systemic principle of the European Union (Baker, Kousis, Young, & Richardson, 1997; Kastrinos, & Weber, 2020). Analysing historical legislation, the Maastricht Treaty in 1992 (hereafter the ‘TEU’) had already underlined the importance of sustainable development.22 The preamble of the TEU sets out the following objectives: to promote economic and social progress for their peoples, taking into account the principle of sustainable development and within the context of the accomplishment of the internal market and of reinforced cohesion and environmental protection, and to implement policies ensuring that advances in economic integration are accompanied by parallel progress in other fields. The principle of sustainable development here goes beyond the environmental protection perspective to also include the principle of cohesion and the demand for the completion of the internal market (Sjåfjell, 2011). The repetition of these assumptions in the wording of Article 3(2) of TEU confirmed that the principle of sustainable development was not only a premise but also contained a binding normative layer for EU bodies (Philip, 2014). While the inclusion of the principle of sustainable development in the preamble can only be regarded as a postulated administrative policy direction or an accepted interpretative formula, its repetition in the specific provision referred to above means that this principle is not just a postulate (Stetter, 2001). Moreover, subsequent provisions of the TEU (i.e., Articles 3(5) and 21(2)) mandate the EU bodies to be guided by the principle of sustainable development not only in their internal relations but also Legal and historical aspects of sustainable development 11 to promote this principle in their external relations, thus clearly underlining its importance (de Sadeleer, 2015). The subsequent EU treaty was the Treaty of Amsterdam (1997), whose main objective turned out to be to clearly define the values that unite the European Union, based on freedom, democracy, respect for human rights, and fundamental freedoms.23 Hence, it can be concluded that the social dimension of sustainable development was formalized at the community level in this very treaty (Aviles, 2011). As regards the subject in question, an extremely important event was the adoption of a socio-economic development plan for the European Union at the Lisbon meeting in 2000 (Douma, 2017).24 The Lisbon Strategy 2000 aimed to improve the competitiveness of the EU economies on the global stage (Bartels, 2013). A comprehensive strategy for introducing the concept of sustainable development was developed shortly afterwards in 2001 (A European Union Strategy for Sustainable Development, endorsed by the European Council at its meeting in Gothenburg and then modified within the European Council on 16 June 2006 as a complement to the Lisbon Strategy – The EU’s Renewed Strategy on Sustainable Development).25 The main objective formulated in the documents was to develop initiatives to ensure a better quality of life by promoting environmental and social innovation (Vedder, 2010). In yet another EU treaty, Treaty on the Functioning of the European Union (TFEU), there is only one provision referring directly to the principle of sustainable development, namely Article 11.26 According to it, environmental protection requirements must be taken into account in the definition and implementation of the Union’s policies and activities, in particular with a view to promoting the concept of sustainable development (Kenig-Witkowska, 2017). Hence, the principle of sustainable development as enshrined in Article 11 is a kind of link between environmental protection requirements and other Union policies. The TEU refers to the principle of sustainable development in much narrower terms, only with regard to the relationship of environmental protection requirements with other EU policies. However, the scope of coverage in Article 11 TFEU applies to all aspects of EU administration, including European integration (Avilés, 2012). The Charter of Fundamental Rights of the European Union (Charter) was adopted and signed on 7 December 2000 at the Nice European Council and then again with amendments at the Lisbon Summit on 12 December 2007. The document is binding thanks to the Lisbon Treaty. Because of the importance and significance of the Charter’s provisions, the document could not ignore the important context of the principle of sustainable development (Toner, 2006). In the preamble of the Charter, it is indicated that the European Union’s pursuit of sustainable and balanced development is framed in isolation from its specific sphere of activity, which can be understood as the need to interpret its provisions putting the concept discussed here as a point of reference (Lock, 2019). 12 Karolina Mania In the contents of the Charter itself, the concept of sustainable development appears in Article 37 stating that a high level of environmental protection must be integrated into the policies of the Union and ensured in accordance with the principle of sustainable development (Quirico, 2021). However, when attempting to interpret the provision and trying to find the context of human rights, it must be stated that the specificity of the Charter and its vague provisions only help to point in a certain direction for policies and further initiatives rather than provide a basis for the creation of rules within the environmental or other areas (Gentimir, 2020). The lack of success in implementing the Lisbon Strategy made it necessary to redefine the goals in view of the ongoing financial crisis and the economic changes in Europe taking place in the EU Member States. Hence, in March 2010, the document Europe 2020: A strategy for smart, sustainable and inclusive growth was formulated with the objective of sustainable development using existing resources.27 At the same time, this topic has also become a priority in the European Union’s long-term programme for social and economic development 2010–2020 Europe 2020, referred to as ‘sustainable growth’.28 The strategy adopted on 17 June 2010 replaced the Lisbon Agenda, which had been in place since 2000. Its basic assumptions were based on building a stable foundation for a sustainable future for the European Union based on intellectual growth, sustainable growth, and inclusive development (Harkiolakis, Prinia, & Mourad, 2012). The Europe 2020 strategy was very detailed in setting out the objectives under specific headings, such as increasing the employment rate for specific age groups, CO2 emissions, and poverty indicators. The multitude of acts relating to sustainable development, growth, and environmental protection at the European Union level shows its importance and relevance to this organization. EU treaty provisions clearly define sustainable development as one of the fundamental legal principles of European integration, but secondary legislation also refers to it. Examples of acts (at the EU level) that have referred directly or indirectly to the subject in question can be multiplied. These include White Papers – documents from the European Commission proposing changes to the common policy, for example, White Paper on the Future of Europe (2017),29 Green Papers – documents dedicated to discussions and consultations on selected topics, for example, Green Paper – European Strategy for Sustainable, Competitive and Secure Energy (2006),30 communiques from the Commission of the European Communities, or opinions of the European Economic and Social Committee. Results In common international law, there exists no legal definition of the concept of sustainable development. Its definitions appearing in non-binding acts do not have universal applicability, which determines its nature and the specificity of Legal and historical aspects of sustainable development 13 the lack of substantive legal consequences of its violation. The principle of sustainable development itself is not of a normative nature either. However, some of its constituent norms do have such a character, although the principle itself is an example of soft law. At the level of the European Union, on the basis of the very treaty provisions, that is, EU primary law, it should be acknowledged that there is no clear legal definition of the concept of sustainable development, but it is nevertheless one of the key principles of European integration. At the EU level, the concept of sustainable development represents the idea of improving the economies of individual Member States in terms of more efficient use of resources, which in turn translates into environmental aspects and maintaining the competitiveness of economies (Bomberg, 2004; Muserra, Papa, & Grimaldi, 2020). Looking at the extensive history of legal acts directly referring to the notion in question, both at international and EU levels, it is clear that the concept of sustainable development is widely respected and has had a significant impact on political decisions and directions of further development chosen by countries despite the vagueness of its conceptual framework. Notes 1 The Rio Declaration: https://daccess-ods.un.org/access.nsf/Get?OpenAgent&DS=A/ CONF.151/26/Rev.1(vol.I)&Lang=E. 2 Agenda 21: https://sustainabledevelopment.un.org/content/documents/Agenda21. pdf. 3 The Declaration on the principles of forest management: https://www.un.org/esa/ documents/ga/conf151/aconf15126-1.htm. 4 The Convention on Biological Diversity: https://www.cbd.int/doc/legal/cbd-en.pdf. 5 The United Nations Framework Convention on Climate Change (UNFCCC): https:// unfccc.int/files/essential_background/background_publications_htmlpdf/application/pdf/conveng.pdf 6 United Nations Conference on Environment & Development Rio de Janeiro, Brazil, 3 to 14 June 1992, AGENDA 21. 7 Kyoto Protocol: https://unfccc.int/process-and-meetings/the-kyoto-protocol/what-isthe -kyoto-protocol/kyoto-protocol-targets-for-the-first-commitment-period. 8 The Millennium Summit: https://www.un.org/en/conferences/environment/newyork 2000. 9 The Millennium Declaration: https://documents-dds-ny.un.org/doc/UNDOC/GEN/ N00/559/51/PDF/N0055951.pdf?OpenElement. 10 Report of the World Summit on Sustainable Development, 2002, Johannesburg, South Africa, 26 August–4 September, A/CONF.199/20: https://www.un.org/en/ conferences/environment/johannesburg2002. 11 The Implementation Plan: https://documents-dds-ny.un.org/doc/UNDOC/GEN/ N02/636/93/PDF/N0263693.pdf?OpenElement. 12 The 2005 World Summit: https://www.un.org/en/conferences/environment/new york2005. 13 Towards Green Growth (2011): https://www.oecd.org/greengrowth/48012345.pdf/. 14 The Development Co-operation Report: https://www.oecd.org/dac/developmentcooperationreport2011.htm. 14 Karolina Mania 15 United Nations Conference on Sustainable Development, Rio+20: https://sustainabledevelopment.un.org/rio20. 16 A/RES/66/288 – The Future We Want: https://www.un.org/ga/search/view_doc. asp?symbol=A/RES/66/288&Lang=E. 17 The 2030 Agenda for Sustainable Development: https://sdgs.un.org/goals. 18 A/RES/70/1 Transforming our world: the 2030 Agenda for Sustainable Development: https://undocs.org/en/A/RES/70/1. 19 UNFCC: https://unfccc.int/resource/docs/2015/cop21/eng/l09r01.pdf. 20 Gabčíkovo-Nagymaros Project – (Hungary/ Slovakia), ICJ Reports, 1997. 21 Jednolity Akt Europejski [Single European Act] OJ L 169, 29.6.1987, pp. 1–28: https://eur-lex.europa.eu/legal-content/PL/TXT/?uri=CELEX:11986U/TXT. 22 Traktat o Unii Europejskiej [Treaty on European Union] OJ C 191, 29.7.1992, pp. 1–112: https://eur-lex.europa.eu/legal-content/PL/TXT/?uri=CELEX:11992M/ TXT. 23 Treaty of Amsterdam amending the Treaty on European Union, the Treaties establishing the European Communities and certain related acts (C 340, 10/11/1997 P. 0001–0144): https://eur-lex.europa.eu/eli/treaty/ams/sign. 24 The Lisbon Strategy: https://www.europarl.europa.eu/meetdocs/2009_2014/documents /empl/dv/lisbonstrategybn_/lisbonstrategybn_en.pdf. 25 A European Union Strategy for Sustainable Development: https://eur-lex.europa.eu/ legal-content/EN/TXT/HTML/?uri=CELEX:52001DC0264&from=EN. The EU’s Renewed Strategy on Sustainable Development: https://data.consilium.europa.eu/ doc/document/ST-10917-2006-INIT/en/pdf. 26 The Treaty on the Functioning of the European Union OJ C 326, 26.10.2012, pp. 47–390: https://eur-lex.europa.eu/legal-content/PL/TXT/?uri=celex%3A12012E%2FTXT. 27 COM/2010/2020 final. Europe 2020 A strategy for smart, sustainable and inclusive growth: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:5201 0DC2020&from=PL. 28 Europe 2020: http://www.europedirect-gdansk.morena.org.pl/wp-content/uploads/ 2015/08/europa_2020.pdf. 29 The White Paper on the Future of Europe (2017): https://ec.europa.eu/info/ future-europe/white-paper-future-europe_en. 30 Green Paper – A European Strategy for Sustainable, Competitive and Secure Energy (2006): https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:5200 6DC0105&from=PL. References Atapattu, S. (2001). Sustainable development, myth or reality: A survey of sustainable development under International Law and Sri Lankan Law. Georgetown Environmental Law Review, 14, 265. Aviles, L. A. (2011). Sustainable development and the legal protection of the environment in Europe. Sustainable Development Law & Policy, 12, 29. Avilés, L. A. (2012). Sustainable development and the legal protection of the environment in Europe. Sustainable Development Law & Policy, 12(3), 7. Baker, S., Kousis, M., Young, S., & Richardson, D. (Eds.). (1997). The politics of sustainable development: Theory, policy and practice within the European Union. Psychology Press. Bartels, L. (2013). Human rights and sustainable development obligations in EU free trade agreements. Legal Issues of Economic Integration, 40(4), 297–313. Legal and historical aspects of sustainable development 15 Boer, B. (1995). Institutionalising ecologically sustainable development: The roles of national, state, and local governments in translating grand strategy into action. Willamette Law Review, 31, 307. Bomberg, E. (2004). Adapting form to function?: From economic to sustainable development governance in the European Union’. In W. Lafferty (Ed.), Governance for Sustainable Development: The Challenge of Adapting Form to Function (pp. 61–94). Edward Elgar. https://doi.org/10.4337/9781845421700.00011 Borowy, I. (2013). Defining sustainable development for our common future: A history of the World Commission on Environment and Development (Brundtland Commission). Routledge. Boyle, A. E., & Freestone, D. (Eds.). (2001). International law and sustainable development: Past achievements and future challenges. Oxford University Press. Brundtland, G. H. (1985). World commission on environment and development. Environmental Policy and Law, 14(1), 26–30. Brunnée, J. (2009). The Stockholm declaration and the structure and processes of international environmental law. In Aldo Chircop & Ted McDorman, (Eds.), The Future of Ocean Regime-Building, (pp. 41–62). Kluwer Law. Colombo, U. (2001). The Club of Rome and sustainable development. Futures, 33(1), 7–11. Dernbach, J. C. (2002). Making sustainable development happen: From Johannesburg to Albany. Albany Law of Environmental Outlook, 8, 173. Douma, W. T. (2017). The promotion of sustainable development through EU trade instruments. European Business Law Review, 28(2), 197–216. Dror, Y. (2012). The capacity to govern: A report to the Club of Rome. Routledge. Emas, R. (2015). The concept of sustainable development: Definition and defining principles. Brief for GSDR, 2015, 10–13140. Gentimir, A. (2020). Environmental protection as fundamental right guaranteed to the European Level. Present Environment & Sustainable Development, 14(2), 121–130. Harkiolakis, N., Prinia, D., & Mourad, L. (2012). Research initiatives of the European Union in the areas of sustainability, entrepreneurship, and poverty alleviation. Thunderbird International Business Review, 54(1), 73–78. Hens, L. (2005). The Rio declaration on environment and development. Regional sustainable development review: Africa. Eolss Publishers. Imran, S., Alam, K., & Beaumont, N. (2014). Reinterpreting the definition of sustainable development for a more ecocentric reorientation. Sustainable Development, 22(2), 134–144. Jabareen, Y. (2008). A new conceptual framework for sustainable development. Environment, Development and Sustainability, 10(2), 179–192. Kastrinos, N., & Weber, K. M. (2020). Sustainable development goals in the research and innovation policy of the European Union. Technological Forecasting and Social Change, 157, 120056. Kenig-Witkowska, M. M. (2017). The concept of sustainable development in the European Union Policy and Law. JCULP, 1, 64. Lafferty, W. M., & Eckerberg, K. (Eds.). (2013). From the Earth Summit to Local Agenda 21: Working towards sustainable development. Routledge. 16 Karolina Mania Lee, B. X., Kjaerulf, F., Turner, S., Cohen, L., Donnelly, P. D., Muggah, R.,... & Gilligan, J. (2016). Transforming our world: Implementing the 2030 agenda through sustainable development goal indicators. Journal of Public Health Policy, 37(1), 13–31. Lock, T. (2019). Rights and principles in the EU charter of fundamental rights. Common Market Law Review, 56(5), 1–20. Li, X. (2020). Transforming our world: The 2030 agenda for sustainable development: An appeal of global cooperation for building green civilization. In Li.X. Green civilization, Springer, 17–35. Meadows, D. H., Meadows, D. L., Randers, J., & Behrens, W. W. (2018). The limits to growth. In Conca, K. & G.D. Dabelko, (Eds.), Green planet blues (pp. 25–29). Routledge. Mensah, J. (2019). Sustainable development: Meaning, history, principles, pillars, and implications for human action: Literature review. Cogent Social Sciences, 5(1), 1653531. Muserra, A. L., Papa, M., & Grimaldi, F. (2020). Sustainable development and the European Union Policy on non‐financial information: An Italian empirical analysis. Corporate Social Responsibility and Environmental Management, 27(1), 22–31. Nanda, V. P. (2005). Sustainable development, international trade and the Doha agenda for development. Chapman Law Review, 8, 53. Pallemaerts, M. (2014). International environmental law from Stockholm to Rio: Back to the future?. In P. Sands, (Ed.) Greening International Law (pp. 1–19). Routledge. Parris, T. M., & Kates, R. W. (2003). Characterizing and measuring sustainable development. Annual Review of Environment and Resources, 28(1), 559–586. Paul, B. D. (2008). A history of the concept of sustainable development: Literature review. The Annals of the University of Oradea, Economic Sciences Series, 17(2), 576–580. Pearce, D. W., & Atkinson, G. D. (1993). Capital theory and the measurement of sustainable development: An indicator of “weak” sustainability. Ecological Economics, 8(2), 103–108. Pearce, D., Barbier, E., & Markandya, A. (2013). Sustainable development: Economics and environment in the third world. Routledge. Pearce, D. W., Turner, R. K., & Turner, R. K. (1990). Economics of natural resources and the environment. Johns Hopkins University Press. Philip, A. B. (2014). The European Union: Environmental policy and the prospects for sustainable development. In Governance and environment in Western Europe (pp. 253–276). Routledge. Porras, I. M. (2014). The Rio Declaration: A new basis for international cooperation. In Greening international law (pp. 20–33). Routledge. Rogers, P. P., Jalal, K. F., & Boyd, J. A. (2012). An introduction to sustainable development. Routledge. Ross, A. (2009). Modern interpretations of sustainable development. Journal of Law and Society, 36(1), 32–54. Ruhl, J. B. (2008). Law for sustainable development: Work continues on the Rubik’s Cube. Tulsa Law Review, 44, 1. de Sadeleer, N. (2015). Sustainable development in EU law: Still a long way to go. Jindal Global Law Review, 6(1), 39–60. Segger, M. C. C. (2009). Sustainable development in international law. In D. Armstrong, (Ed.), Routledge Handbook of International Law (pp. 381–400). Routledge. Sjåfjell, B. (2011). Sustainable development, EU law and companies: The EU law framework for the sustainable companies project. International and Comparative Corporate Law Journal, 8(1), 1–14. Legal and historical aspects of sustainable development 17 Stetter, S. (2001). Maastricht, Amsterdam and Nice: The environmental lobby and greening the treaties. European Energy and Environmental Law Review, 10(5), 150–159. Stevens, C., & Kanie, N. (2016). The transformative potential of the sustainable development goals (SDGs). International Environmental Agreements: Politics, Law and Economics, 16(3), 393–396. Toner, H. (2006). Impact assessments and fundamental rights protection in EU law. European Law Review, 31(3), 316. Quirico, O. (2021). Integrating Human Rights and Environmental Duties: Prospective Implications of Article 37 of the EU Charter of Fundamental Rights. Boston University International Law Journal, 39, 41. Vedder, H. (2010). The Treaty of Lisbon and European environmental law and policy. Journal of Environmental Law, 22(2), 285–299. Waas, T., Verbruggen, A., & Wright, T. (2010). University research for sustainable development: Definition and characteristics explored. Journal of Cleaner Production, 18(7), 629–636. Weizsäcker, E. U., Lovins, A. B., & Lovins, L. H. (1998). Factor four: Doubling wealthhalving resource use: The new report to the Club of Rome. Earthscan. Wilkins, H. (2008). The integration of the pillars of sustainable development: A work in progress. McGill International Journal of Sustainable Development Law & Policy, 4, 163. DOI: 10.4324/9781003379409-4 2 Sustainable development goals – assessment and relationships Aneta Kuźniarska Introduction A common element of the majority of the definitions of sustainable development is emphasising on the importance of the interrelationship between the development of civilisation and the protection and restoration of the natural and social environment. The definitions essentially indicate the need to protect the social and environmental equilibrium in the process of economic development, and their implementation is possible thanks to the global goals set, which in a more or less precise manner indicate the directions in which organisations and people should follow to care for both the environment and each other. The strategic Sustainable Development Goals (SDGs) Developed by a broad consensus of the business milieus, political milieus and nongovernmental organisations, constitute, first, new growth opportunities for businesses and, second, a chance to build sustainable, long-term competitive advantage. Its important sources include the possibility of creating and developing innovative products and services that meet the needs of increasingly aware and responsible consumers, as well as improving the reputation of enterprises. It is worth bearing in mind that, in addition to the opportunities arising from this, they also face challenges that are difficult to overcome in a changing environment (Urbaniec, 2018a). Accomplishing the SDGs is rendered more difficult because of numerous compromises accepted for the sake of economic growth at the expense of social well-being and the preservation of the environment; on the other hand, the concept of inclusive development emphasises the three dimensions of development: social, environmental and political (Fonseca et al., 2020). Regardless of the fact that the SDGs are of a global character, activities undertaken within their frameworks are of a local character, and depend on how far countries are from achieving the goals, and the sheer degree of development and commitment to sustainable development of each country influences its domestic interests and actions (Salvia et al., 2019). Sustainable development goals – assessment and relationships 19 SDGs in the past and now The outline of the history of the concept of sustainable development presented in Chapter 1 translates directly into change, or rather an evolution of goals adopted within its framework. Nevertheless, it does not change the fact that the crucial role in disseminating the idea of sustainable development is still played by the United Nations (UN) and its agencies. A decisive influence upon the development of the concept of sustainable development was the report, published in 1987 and prepared by the World Commission on Environment and Development of the UN, where the main goal was to meet the needs of present and future generations in full compliance with the natural environment (WCED, 1987). Initiated at the Earth Summit in 1972, the concept of sustainable development, developed and perfected in the following years, took shape for the first time when its assumed premises were adopted as the basis for a plan of action at the second Earth Summit in Rio de Janeiro in 1992. It was then that the two most important documents were drawn up (United Nations, 1992): 1 Rio Declaration on Environment and Development, which contained the general philosophy and rationale for sustainable development; it additionally included assumptions of an ideological and postulative nature, indicating that not only material development but also the intellectual and spiritual development of the individual is crucial, and therefore a re-evaluation of existing lifestyles and ethical norms must be carried out to create a ‘conscious’ human being acting in a sustainable manner, 2 Agenda 21, that is, a plan containing the detailed principles and processes relevant to the implementation of this concept. The conditions for sustainable development at that time included (among others) – combating poverty, – eradicating the unsustainable system of production and consumption, – the protection of the environment, and its interdependence with peace and development, – economic growth, which ought to result in increasing social cohesion (including, among others, the reduction of social stratification, the prevention of marginalisation and discrimination), and be conducive to the improvement of environmental quality (among others, by reducing the harmful effects of production and consumption on the state of the environment and the protection of natural resources) (United Nations, 1992; Dyr et al., 2019) The declaration contained the postulates indicating that all human beings, societies and generations have the right to a healthy and productive life, and also to 26 Aneta Kuźniarska adhere to the opinion that SDGs are theoretical, that all are treated as priorities, and that means that none of them is really a priority (Easterly, 2015). The negative assessment also relates to the tools in use; both kinds of goals were, and still are, assessed with the application of different methods and varied tools, frequently varying from country to country, which renders it difficult to compare them properly and to analyse progress (Pogge & Sengupta, 2015). As researchers on the topic point out, more goals and indicators prepared for them does not mean that these goals will be better; on the contrary, in fact, in many cases, they might cause an unwelcome confusion (Zondervan, 2017). Some of them ought to be limited and a set of feasible, measurable and transparent targets should be established to facilitate both easier and more effective decisionmaking as well as comparisons (Venkatesh, 2021). It is worth remembering that a key role in accomplishing the SDGs is played by the private sector, and, here, the starting point for consideration is the hypothesis that larger and/or more powerful companies, by engaging in relationships with smaller actors, can both contribute to and impede the achievement of the goals. Elements of the organisation that may strongly influence them include certain values, for example greed or rivalry, which may be perceived as normatively neutral, and even as required qualities (Zawadzki, 2014). Other barriers to goal implementation include a lack of state support in the implementation of the SDGs, their excessive distance from business goals or a low culture of collaboration in accomplishing non-business goals (Urbaniec, 2018b). The unsatisfactory extent of accomplishing the SDGs may be the result of the behaviours of enterprises resulting from the influence of the ideology of building shareholder value. It motivates enterprises to retain as much of their value as possible, and it should be borne in mind that the active involvement of large companies in the achievement of certain goals may risk a lack of growth in retained value and therefore, may result in a failure to generate further profits for the shareholders (Gulski, 2021). The COVID-19 pandemic also poses a threat to the SDGs, with negative impacts on developed countries and even more unfavourable impacts on developing countries, which do not have the resources to cope with the economic and social challenges caused by the pandemic. The economic stagnation associated with COVID-19 is estimated to plunge 420–580 million people into poverty, increasing global poverty for the first time since 1990 (Sumner et al., 2020). COVID-19 led to the lower achievement of the SDGs (Shulla et al., 2021), but at the same time, contributed to the development of the digitalisation and consolidation of health, educational and social services, as pro-growth government spending, often during a crisis, has significant positive effects in the social care, health and education sectors (Reeves et al., 2013). In terms of meeting environmental goals, COVID-19 has resulted in improved air quality and reduced CO2 emissions (Shulla et al., 2021). Sustainable development goals – assessment and relationships 27 The threats to the implementation of the SDGs resulting from the pandemic include (Kaczmarek, 2020) – the focus of governments on their own country and its own goals and tasks; – reducing official development aid and other sources of development financing; – weakening the system of global collaboration; – changing political priorities at the expense of economic development; – re-prioritising research funding hitherto aimed at solving problems in developing countries; – undermining the free market and seeking a new paradigm for the global economy. Relationship between the SDGs The concept of the SDGs, in contrast to that of the MDGs, indicates an integrated approach to decision-making and includes a policy focusing not only on individual components/dimensions of sustainable development separately but also takes into account their interconnectedness and interdependence to reduce compromises, as well as create and use the synergy effect (van Tulder, 2018). Synergies between sustainability goals largely outweigh compromises, but interestingly, negative correlations are observed across all the SDGs. Moreover, correlations are systematically assessed not only between goals but also between SDG indicators, and so (Pradhan et al., 2017): 1 a statistically significant positive correlation between a pair of SDG indicators is identified as a synergy, 2 a statistically significant negative correlation between pairs of SDG indicators is classified as a compromise. As part of the process of assessment, the synergies and compromises between the pairs of the SDGs are categorised on the domestic and global scale, so as to, in further course, identify the most frequent interactions occurring between them (Pradhan et al., 2017). The crucial issue within the frameworks of the described interactions of the SDGs, encompassing the compromises and synergies between goals (SDG) and within the frameworks of their indicators, are contradictions between economic growth and the sustainable use of resources (Nilsson et al., 2016). Nevertheless, it ought to be indicated that the negative interactions are regarded as the perfect introduction to a dialogue between science and politics (Obersteiner et al., 2016), which frequently stimulates further work within a relevant field. The inconsistency and incoherence in the sustainability goals relate to indicators in the quantitative dimension – although research presents the indicators, they are hampered by severe data limitations and do not inform decision-makers about which of the underlying economic, social or 28 Aneta Kuźniarska environmental pillars have a significant impact on sustainability, and from an organisational perspective this is crucial (Bali Swain & Yang-Wallentin, 2020; Spaiser et al., 2017). Based on the research conducted so far, three general types of interactions between SDG targets have been identified (Nilsson et al., 2016): a positive dynamics – positive interactions between the SDGs occur when the SDGs are active, reinforcing or indivisible, b neutral or coherent dynamics – describe a situation where contributions towards one goal do not result in significant positive or negative interactions with another goal, c negative dynamics – interactions arise when goals are constraining, counteracting, or cancelling. There are few SDGs that focus exclusively on social issues or solely on environmental or relational issues. All of them quite substantively link at least two of the three dimensions. The exceptions are SDG 11, which includes all three elements, and SDG 17, which moves relational issues to the operational level (Gupta & Vegelin, 2016). The cause-and-effect relationships between the SDGs can be seen from the first cursory analysis – they can be seen, for example, between increasing employment and reducing poverty, between reducing poverty and improving the natural environment. It is worth noting that improvements towards one SDG can enhance or harm the development or improvement of another goal (Barbier & Burgess, 2019). Other relationships of the SDGs are outlined below: 1 no poverty (SDG1) may be enhanced by the benefits of improved water quality and sanitation (SDG6), and also zero hunger (SDG2) (Fuso Nerini et al., 2018) 2 SDG12 (responsible consumption and production) is the goal most closely related to commerce (Pradhan et al., 2017) 3 SDG 02 (Zero hunger) and SDG 01 (No poverty) and SDG 03 (Good health and well-being). 4 SDG 03 (Good health and well-being) and SDG 08 (Decent work and economic growth). 5 SDG 06 (Clean water and sanitation) and SDG 12 (Responsible consumption and production). 6 SDG 07 (Affordable and clean energy) and SDG1 (No poverty), SDG2 (Zero hunger), SDG3 (Good health and well-being), SDG8 (Decent work and economic growth), SDG13 (Climate action). 7 SDG7 (Affordable and clean energy) and SDG6 (Clean water and sanitation) 8 SDG8 (Decent work and economic growth) and SDG1 (no poverty) (Singh et al., 2018). Sustainable development goals – assessment and relationships 29 9 SDG 11 (Sustainable cities and communities) and SDG 03 (Good health and well-being). 10 SDG 12 (Responsible consumption and production) and SD6 (Clean water and sanitation). 11 SDG13 (Climate action) and SDG15 (Life on land). 12 SDG13 (Climate action) and SDG14 (Life below water) 13 SD14 (Life below water) and SDG1 (No poverty), SDG2 (Zero hunger) and SDG8 (Decent work and economic growth). 14 SDG15 (Life on land) and SDG1 (No poverty), SDG2 (Zero hunger), SDG8 (Decent work and economic growth), SDG13 (Climate action) and SDG14 (Life below water). 15 SDG7 (Affordable and clean energy) and SDG6 (Clean water and sanitation) Conclusions The development, both quantitative and qualitative, of the SDGs that have been developed and adopted in successive years shows how strongly global problems related to human activities are escalating. The transition from the 1987 principal goal to the Millennium Goals to the 2030 Agenda goals indicates ever-expanding problems in all dimensions of sustainable development. The road to quantifying and monitoring the SDGs is still challenging – there is a need for a deep understanding of sustainable development, commitment and capacity to operationalise and implement its multidimensional goals, access to data, expertise, analysis and interpretation of results. As practice shows, there is still a conflict between socio-economic development and the environmental dimension, making it difficult to identify and implement the most effective strategy for creating sustainable development (Redclift, 2005). In addition, doubts arise to what extent such a broad and global sustainable development program such as the 2030 Agenda can be effectively implemented, especially in the face of the diverse economic and political interests of various social groups, states and blocs, the oligarchisation of certain economies, the weakening role of states with the parallel strengthening of the role of transnational corporations and global finance (Gruchelski & Niemczyk, 2016). Perhaps the biggest reason for the failure to establish global sustainable socio-economic development is also the structure of aid offered to poor countries. To a greater extent, these countries are provided, for commercial reasons, with means of consumption, instead of means of production and infrastructure (Gruchelski & Niemczyk, 2013). References Bali Swain, R., & Yang-Wallentin, F. (2020). Achieving sustainable development goals: Predicaments and strategies. International Journal of Sustainable Development & World Ecology, 27(2), 96–106. https://doi.org/10.1080/13504509.2019.1692316 30 Aneta Kuźniarska Deneulin, S., & Shahani, L. (2009). An introduction to the human development and capability approach. Freedom and agency. Earthscan International Development Research Centre. Dlouhá, J., & Pospíšilová, M. (2018). Education for sustainable development goals in public debate: The importance of participatory research in reflecting and supporting the consultation process in developing a vision for Czech education. Journal of Cleaner Production, 172, 4314–4327. https://doi.org/10.1016/j.jclepro.2017.06.145 Dyr, T., Misiurski, P., & Ziółkowska, K. (2019). Costs and benefits of using buses fuelled by natural gas in public transport. Journal of Cleaner Production, 225, 1134–1146. https://doi.org/10.1016/j.jclepro.2019.03.317 Easterly, W. (2015). The trouble with the sustainable development goals. Current History, 114(775), 322–324. https://doi.org/10.1525/curh.2015.114.775.322 Fayomi, O. S. I., Okokpujie, I. P., & Udo, M. (2018). The role of research in attaining sustainable development goals. IOP Conference Series: Materials Science and Engineering, 413(1), 012002. https://doi.org/10.1088/1757-899X/413/1/012002 Fonseca, L. M., Domingues, J. P., & Dima, A. M. (2020). Mapping the Sustainable Development Goals Relationships. Sustainability, 12(8), 3359. https://doi.org/10.3390/ su12083359 Fuso Nerini, F., Tomei, J., To, L. S., Bisaga, I., Parikh, P., Black, M., Borrion, A., Spataru, C., Castán Broto, V., Anandarajah, G., Milligan, B., & Mulugetta, Y. (2018). Mapping synergies and trade-offs between energy and the sustainable development goals. Nature Energy, 3(1), 10–15. https://doi.org/10.1038/s41560-017-0036-5 Griggs, D., Stafford Smith, M., Rockström, J., Öhman, M. C., Gaffney, O., Glaser, G., Kanie, N., Noble, I., Steffen, W., & Shyamsundar, P. (2014). An integrated framework for sustainable development goals. Ecology and Society, 19(4), art49. https://doi. org/10.5751/ES-07082-190449 Gruchelski, M., & Niemczyk., J. (2013). Zrównoważony unijny rozwój społecznogospodarczy z uwzględnieniem polskiego sektora rolno-żywnościowego i wsi; ocena trafności działań. Postępy Techniki Przetwórstwa Spożywczego, 1, 125–135. Gruchelski, M., & Niemczyk, J. (2016). The 2030 Agenda for sustainable development goals and sustainable development goals – chances of implementation. Postępy Techniki Przetwórstwa Spożywczego, 1, 122–126. Gulski, B. (2021). Nieetyczne zachowania w relacjach między przedsiębiorstwami jako zagrożenie dla realizacji Celów Zrównoważonego Rozwoju i wynikających z nich zadań. Nowe Tendencje w Zarządzaniu, 1(1), 7–43. https://doi.org/10.31743/ NTZ.13156 Gupta, J., & Vegelin, C. (2016). Sustainable development goals and inclusive development. International Environmental Agreements: Politics, Law and Economics, 16(3), 433–448. https://doi.org/10.1007/s10784-016-9323-z Kabeer, N. (2010). Can the MDGs provide a pathway to social justice?: The challenge of intersecting inequalities. Institute of Development Studies. United Nations Development Programme. Kaczmarek, F. (2020). Pandemia COVID-19 a Cele Zrównoważonego Rozwoju. In K. Hajder, M. Kacperska, & Ł. Donaj (Eds.), Konsekwencje pandemii COVID-19 (pp. 159–172). Świat i gospodarka. Sustainable development goals – assessment and relationships 31 Moore, H. L. (2015). Global Prosperity and Sustainable Development Goals. Journal of International Development, 27(6), 801–815. https://doi.org/10.1002/jid.3114 Nilsson, M., Griggs, D., & Visbeck, M. (2016). Map the interactions between Sustainable Development Goals. Nature, 534, 320–322. Obersteiner, M., Walsh, B., Frank, S., Havlík, P., Cantele, M., Liu, J., Palazzo, A., Herrero, M., Lu, Y., Mosnier, A., Valin, H., Riahi, K., Kraxner, F., Fritz, S., & van Vuuren, D. (2016). Assessing the land resource–food price nexus of the sustainable development goals. Science Advances, 2(9). https://doi.org/10.1126/sciadv.1501499 Pogge, T., & Sengupta, M. (2015). The sustaintable development goals (SDGs) as drafted: Nice idea, poor execution. Washington International Law Journal, 24(3), 571–587. Pradhan, P., Costa, L., Rybski, D., Lucht, W., & Kropp, J. P. (2017a). a systematic study of sustainable development goal (SDG) Interactions. Earth’s Future, 5(11), 1169–1179. https://doi.org/10.1002/2017EF000632 Redclift, M. (2005). Sustainable development (1987–2005): An oxymoron comes of age. Sustainable Development, 13(4), 212–227. https://doi.org/10.1002/sd.281 Reeves, A., Basu, S., McKee, M., Meissner, C., & Stuckler, D. (2013). Does investment in the health sector promote or inhibit economic growth? Globalization and Health, 9(1), 43. https://doi.org/10.1186/1744-8603-9-43 Rokicka, E., & Woźniak, W. (2016). W kierunku zrównoważonego rozwoju. Koncepcje, interpretacje, konteksty. Uniwersytet Łodzki. Salvia, A. L., Leal Filho, W., Brandli, L. L., & Griebeler, J. S. (2019). Assessing research trends related to Sustainable Development Goals: local and global issues. Journal of Cleaner Production, 208, 841–849. https://doi.org/10.1016/j.jclepro.2018.09.242 Shulla, K., Voigt, B.-F., Cibian, S., Scandone, G., Martinez, E., Nelkovski, F., & Salehi, P. (2021). Effects of COVID-19 on the sustainable development goals (SDGs). Discover Sustainability, 2(1), 15. https://doi.org/10.1007/s43621-021-00026-x Singh, G. G., Cisneros-Montemayor, A. M., Swartz, W., Cheung, W., Guy, J. A., Kenny, T.-A., McOwen, C. J., Asch, R., Geffert, J. L., Wabnitz, C. C. C., Sumaila, R., Hanich, Q., & Ota, Y. (2018). A rapid assessment of co-benefits and trade-offs among Sustainable Development Goals. Marine Policy, 93, 223–231. https://doi.org/10.1016/j. marpol.2017.05.030 Spaiser, V., Ranganathan, S., Swain, R. B., & Sumpter, D. J. T. (2017). The sustainable development oxymoron: Quantifying and modelling the incompatibility of sustainable development goals. International Journal of Sustainable Development & World Ecology, 24(6), 457–470. https://doi.org/10.1080/13504509.2016.1235624 United Nations. (1992). Agenda 21 – United Nations Conference on Environment & Development Rio de Janerio, United Nations. United Nations. (2015a). Transforming our world: The 2030 agenda for sustainable development, United Nations. United Nations. (2015b). Resolution adopted by the General Assembly on 27 July 2015. A/RES/69/313, United Nations. Urbaniec, M. (2018a). Rola przedsiębiorczości w kontekście zrównoważonego rozwoju. Przedsiębiorczość – Edukacja, 14, 26–39. https://doi.org/10.24917/20833296.14.2 Urbaniec, M. (2018b). Rola przedsiębiorczości w kontekście zrównoważonego rozwoju. Przedsiębiorczość – Edukacja, 14, 26–39. https://doi.org/10.24917/20833296.14.2 32 Aneta Kuźniarska van Tulder, R. (2018). Business & the sustainable development goals: A framework for effective corporate involvement. Rotterdam School of Management, Erasmus University. Venkatesh, G. (2021). Sustainable development goals – Quo Vadis, cities of the world? Problemy Ekorozwoju, 16(1), 171–179. https://doi.org/10.35784/pe.2021.1.18 WCED. (1987). Our common future. World Commission on Environment and Development. Wiśniewska, M., & Wyrwa, J. (2022). Bezpieczeństwo żywności i żywnościowe w okresie pandemii: ujęcie interdyscyplinarne. Zondervan, R. (2017). The scientific and techno-logical community in the sustainable development goal process. Environmental Scientist, 26(3), 34–38. DOI: 10.4324/9781003379409-5 3 The economic dimension of sustainable development Judyta Lubacha Introduction Extensive research offers evidence that economic growth has a negative impact on the environment. Economic welfare is based on the exploitation of natural resources (Kalimeris et al., 2020). Many developing countries export raw and primary materials, especially those rich in minerals and fuel deposits (AbouAli & Abdelfattah, 2013; West et al., 2014). Economic growth is related to the increase in energy consumption (Ozcan et al., 2020; Sarwar et al., 2017). Moreover, the consumption of energy and oil leads to an increase in pollution and CO2 emissions (Omri, 2013). Research shows a strong positive correlation between economic growth and CO2 emissions (Leitão et al., 2022). In the age of globalisation emissions are transferred to countries of production, which causes the deepening of global inequalities (Cadarso et al., 2012). Developed countries like USA, EU and Japan are the main carbon importers, and developing countries such as China and Southeast Asian countries are major carbon exporters (Y. Wang et al., 2022). In this chapter sustainable economic development is discussed from the perspective of three main economic actors: business sector, household sector (consumers) and governmental sector. Two main questions are addressed in the chapter: (1) How do economic actors create pressure on the natural environment? (2) How can economic actors reduce their negative impact on the natural environment? The systematic literature review is based on the results of the query “sustainable development” in the Web of Science Citation Index with Abstracts in WoS Category Economics. From 5,170 records (download date September 2022) those related to business, households and governmental sector were chosen for analysis. Business sector Each of the business sectors (agricultural, industrial and services) creates environmental pressure in different ways. Nevertheless, all sectors are responsible for greenhouse gases (GHGs) emission (Table 3.1). 34 Judyta Lubacha Innovations are one of the means to achieve the goal of sustainable agriculture (Aldy et al., 1998). Food production requires water and energy use and alternatives for fossil fuels are already in place – solar energy for irrigation (Lefore et al., 2021) and biofuels (Kung, 2018). Although bioethanol and biodiesel production use water and fuel, the sustainability biofuel depends on the production technology used (Rosegrant et al., 2013). Water use may be reduced by more efficient irrigation techniques (Odegard & van der Voet, 2014). Crop diversification may decrease soil erosion (Alcon et al., 2020). The decrease in GHG emissions from agriculture as well as decrease of deforestation may be achieved through the reduction of pasture land (de Pinto et al., 2016). Adoption of sustainable agricultural practices should take into account informal norms and beliefs. Direct implementation of “western” “scientific” approach may be counterproductive in developing countries. Social change needs to be developed based on local values and beliefs (Shah et al., 2017). Social capital in the form of social networks (relatives, traders) and memberships in professional organisations increases the probability of adoption of sustainable practices in agriculture (González, 2012; Teklewold et al., 2013). Electricity and heat sectors are responsible for the highest GHG emissions (Alajmi, 2021; Gingrich et al., 2011), cement, steel and iron manufacturing are the second largest emitters (Dhar et al., 2020). SO2 emission is related to coal combustion (Apsimon & Warren, 1996). Renewable energy sources such as solar photovoltaic and wind are widely used as alternatives to fossil fuel combustion (Xie & Jamaani, 2022). However, it should be noted that the production of energy from solar and wind farms requires scarce materials like copper, lithium, and aluminium (García-Olivares et al., 2012). Biogas produced from municipal waste is another alternative to non-renewable energy sources. Moreover, the Table 3.1 Main areas of environmental pressure in agriculture, industry and services Agriculture Industry Services • Greenhouse gas emission (de Pinto et al., 2016; Jorgenson & Birkholz, 2010) • Freshwater irrigation (Albornoz-Mendoza & Mainar-Causapé, 2019) • Soil erosion (Suleimenov & Oram, 2000) • Deforestation (MechicheAlami et al., 2021) • Species extinctions (Chaudhary & Brooks, 2019) • Greenhouse gas emission (Dhar et al., 2020; Gingrich et al., 2011) • SO2 emission (Apsimon & Warren, 1996; Tang et al., 2022) • High water withdrawal (Alkon et al., 2019; Pan et al., 2012) • Exposure to toxic substances (Kuwayama et al., 2017) • Greenhouse gas emission (Mattila & Antikainen, 2011; Saidi, 2021) • Particulate matter emission (Chen et al., 2022; Zhang et al., 2022) • Food waste (Sonnino & McWilliam, 2011) Source: Own study. The economic dimension of sustainable development 35 reuse of recyclables allows for a reduction in energy use in production (Lino & Ismail, 2011). Another important way of reduction of greenhouse emission is energy saving and increase of energy productivity and efficiency by means of technological innovation and changes in the production process (E. Z. Wang et al., 2022; Xie & Jamaani, 2022). Freight and passenger transport are the main sources of CO2 emission (accounting for ¼ of the world’s emissions) (Mattila & Antikainen, 2011; Saidi, 2021; Zegras, 2007). The main way for transport decarbonisation is the adaptation of environmentally-friendly means of transportation such as electric or hybrid vehicles for passenger transport (Corazza et al., 2016; Kołoś & Taczanowski, 2016) and rail freight transportation (Behrends, 2017; Dinwoodie, 2006). However, electric vehicles are not a sustainable solution without changing the energy production sources like fossil fuels (Zawieska & Pieriegud, 2018). Households sector Consumers’ environmental pressure is related to various business sectors (Figure 3.1). Household food consumption, housing (heating and energy use) and mobility are seen as the most damaging factors to the environment (Spangenberg & Lorek, 2002). household consumption indirect pressurre agriculture food consumption industry household energy consumption purchasing manufactured goods services transportation direct pressure heating cooking individual transport Figure 3.1 Main areas of ecological pressure in consumption in relation to business sectors 42 Judyta Lubacha Kalimeris, P., Bithas, K., Richardson, C., & Nijkamp, P. (2020). Hidden linkages between resources and economy: A “Beyond-GDP” approach using alternative welfare indicators. Ecological Economics, 169. https://doi.org/10.1016/j.ecolecon.2019.106508 Kębłowski, W., van Criekingen, M., & Bassens, D. (2019). Moving past the sustainable perspectives on transport: An attempt to mobilise critical urban transport studies with the right to the city. Transport Policy, 81, 24–34. https://doi.org/10.1016/j. tranpol.2019.05.012 Kołoś, A., & Taczanowski, J. (2016). The feasibility of introducing light rail systems in medium-sized towns in Central Europe. Journal of Transport Geography, 54, 400– 413. https://doi.org/10.1016/j.jtrangeo.2016.02.006 Koo, B. (2017). Examining the impacts of feed-in-tariff and the clean development mechanism on Korea’s renewable energy projects through comparative investment analysis. Energy Policy, 104, 144–154. https://doi.org/10.1016/j.enpol.2017.01.017 Korhonen, J., Honkasalo, A., & Seppälä, J. (2018). Circular economy: The concept and its limitations. Ecological Economics, 143, 37–46. https://doi.org/10.1016/j. ecolecon.2017.06.041 Kułyk, P., Michałowska, M., & Patelska, M. (2017). Consumer attitudes in the light of the concept of sustainable consumption in Lubuskie voivodeship against the background of trends in consumption in Poland. Oeconomia Copernicana, 8(2), 181–197. https:// doi.org/10.24136/oc.v8i2.12 Kung, C. C. (2018). A dynamic framework of sustainable development in agriculture and bioenergy. Agricultural Economics (Czech Republic), 64(10), 445–455. https:// doi.org/10.17221/281/2017-AGRICECON Kurata, M., Takahashi, K., & Hibiki, A. (2020). Gender differences in associations of household and ambient air pollution with child health: Evidence from household and satellite-based data in Bangladesh. World Development, 128. https://doi.org/10.1016/j. worlddev.2019.104779 Kuwayama, Y., Roeshot, S., Krupnick, A., Richardson, N., & Mares, J. (2017). Risks and mitigation options for on-site storage of wastewater from shale gas and tight oil development. Energy Policy, 101, 582–593. https://doi.org/10.1016/j.enpol.2016.11.016 Lee, S., & Lee, B. (2014). The influence of urban form on GHG emissions in the U.S. household sector. Energy Policy, 68, 534–549. https://doi.org/10.1016/j.enpol.2014.01.024 Lefore, N., Closas, A., & Schmitter, P. (2021). Solar for all: A framework to deliver inclusive and environmentally sustainable solar irrigation for smallholder agriculture. Energy Policy, 154. https://doi.org/10.1016/j.enpol.2021.112313 Leitão, J., Ferreira, J., & Santibanez-González, E. (2022). New insights into decoupling economic growth, technological progress and carbon dioxide emissions: Evidence from 40 countries. Technological Forecasting and Social Change, 174. https://doi. org/10.1016/j.techfore.2021.121250 Lin, B., & Du, Z. (2017). Can urban rail transit curb automobile energy consumption? Energy Policy, 105, 120–127. https://doi.org/10.1016/j.enpol.2017.02.038 Lino, F. A. M., & Ismail, K. A. R. (2011). Energy and environmental potential of solid waste in Brazil. Energy Policy, 39(6), 3496–3502. https://doi.org/10.1016/j. enpol.2011.03.048 Liobikiene, G., Mandravickaite, J., & Bernatoniene, J. (2016). Theory of planned behavior approach to understand the green purchasing behavior in the EU: A cross-cultural study. Ecological Economics, 125, 38–46. https://doi.org/10.1016/j.ecolecon.2016.02.008 The economic dimension of sustainable development 43 Mahumane, G., & Mulder, P. (2019). Expanding versus greening? Long-term energy and emission transitions in Mozambique. Energy Policy, 126, 145–156. https://doi. org/10.1016/j.enpol.2018.10.056 Malla, S. (2013). Household energy consumption patterns and its environmental implications: Assessment of energy access and poverty in Nepal. Energy Policy, 61, 990– 1002. https://doi.org/10.1016/j.enpol.2013.06.023 Masera, O. R., Saatkamp, B. D., & Kammen, D. M. (2000). From linear fuel switching to multiple cooking strategies: A critique and alternative to the energy ladder model. World Development, 28(12), 2083–2103. www.elsevier.com/locate/worlddev Matsika, R., Erasmus, B. F. N., & Twine, W. C. (2013). Double jeopardy: The dichotomy of fuelwood use in rural South Africa. Energy Policy, 52, 716–725. https://doi. org/10.1016/j.enpol.2012.10.030 Mattila, T., & Antikainen, R. (2011). Backcasting sustainable freight transport systems for Europe in 2050. Energy Policy, 39(3), 1241–1248. https://doi.org/10.1016/j. enpol.2010.11.051 McGovern, G. (2021). Capturing community value in civic energy business model design. Energy Policy, 156. https://doi.org/10.1016/j.enpol.2021.112468 Mechiche-Alami, A., Yagoubi, J., & Nicholas, K. A. (2021). Agricultural land acquisitions unlikely to address the food security needs of African countries. World Development, 141. https://doi.org/10.1016/j.worlddev.2020.105384 Mele, A., Paglialunga, E., & Sforna, G. (2021). Climate cooperation from Kyoto to Paris: What can be learnt from the CDM experience? Socio-Economic Planning Sciences, 75. https://doi.org/10.1016/j.seps.2020.100942 Millar, N., McLaughlin, E., & Börger, T. (2019). The circular economy: Swings and roundabouts? Ecological Economics, 158, 11–19. https://doi.org/10.1016/j. ecolecon.2018.12.012 Newell, R. G., Pizer, W. A., Raimi, D., Burtraw, D., Ellerman, D., Kerr, S., Stavins, R., & Wiener, J. (2014). Carbon markets: Past, present, and future. Annual Review of Resource Economics, 6, 191–215. http://www.nber.org/papers/w18504 Nigro, M., Castiglione, M., Maria Colasanti, F., de Vincentis, R., Valenti, G., Liberto, C., & Comi, A. (2022). Exploiting floating car data to derive the shifting potential to electric micromobility. Transportation Research Part A: Policy and Practice, 157, 78–93. https://doi.org/10.1016/j.tra.2022.01.008 Odegard, I. Y. R., & van der Voet, E. (2014). The future of food - scenarios and the effect on natural resource use in agriculture in 2050. Ecological Economics, 97, 51–59. https://doi.org/10.1016/j.ecolecon.2013.10.005 Omri, A. (2013). CO2 emissions, energy consumption and economic growth nexus in MENA countries: Evidence from simultaneous equations models. Energy Economics, 40, 657–664. https://doi.org/10.1016/j.eneco.2013.09.003 Owens, S., & Driffill, L. (2008). How to change attitudes and behaviours in the context of energy. Energy Policy, 36(12), 4412–4418. https://doi.org/10.1016/j.enpol.2008.09.031 Ozcan, B., Tzeremes, P. G., & Tzeremes, N. G. (2020). Energy consumption, economic growth and environmental degradation in OECD countries. Economic Modelling, 84, 203–213. https://doi.org/10.1016/j.econmod.2019.04.010 Pan, L., Liu, P., Ma, L., & Li, Z. (2012). A supply chain based assessment of water issues in the coal industry in China. Energy Policy, 48, 93–102. https://doi.org/10.1016/j. enpol.2012.03.063 44 Judyta Lubacha Redman, L., Friman, M., Gärling, T., & Hartig, T. (2013). Quality attributes of public transport that attract car users: A research review. Transport Policy, 25, 119–127. https://doi.org/10.1016/j.tranpol.2012.11.005 Reynolds, C., Goucher, L., Quested, T., Bromley, S., Gillick, S., Wells, V. K., Evans, D., Koh, L., Carlsson Kanyama, A., Katzeff, C., Svenfelt, Å., & Jackson, P. (2019). Review: Consumption-stage food waste reduction interventions – What works and how to design better interventions. Food Policy, 83, 7–27. https://doi.org/10.1016/j. foodpol.2019.01.009 Rosegrant, M. W., Ringler, C., Zhu, T., Tokgoz, S., & Bhandary, P. (2013). Water and food in the bioeconomy: Challenges and opportunities for development. Agricultural Economics (United Kingdom), 44(SUPPL1), 139–150. https://doi.org/10.1111/agec.12058 Saidi, S. (2021). Freight transport and energy consumption: What impact on carbon dioxide emissions and environmental quality in MENA countries? Economic Change and Restructuring, 54(4), 1119–1145. https://doi.org/10.1007/s10644-020-09296-3 Sardianou, E. (2007). Estimating energy conservation patterns of Greek households. Energy Policy, 35(7), 3778–3791. https://doi.org/10.1016/j.enpol.2007.01.020 Sarwar, S., Chen, W., & Waheed, R. (2017). Electricity consumption, oil price and economic growth: Global perspective. Renewable and Sustainable Energy Reviews, 76, 9–18. https://doi.org/10.1016/j.rser.2017.03.063 Shah, S. H., Angeles, L. C., & Harris, L. M. (2017). Worlding the intangibility of resilience: The case of rice farmers and water-related risk in the Philippines. World Development, 98, 400–412. https://doi.org/10.1016/j.worlddev.2017.05.004 Shem, C., Simsek, Y., Hutfilter, U. F., & Urmee, T. (2019). Potentials and opportunities for low carbon energy transition in Vietnam: A policy analysis. Energy Policy, 134. https://doi.org/10.1016/j.enpol.2019.06.026 Skvarciany, V., Lapinskaite, I., & Volskyte, G. (2021). Circular economy as assistance for sustainable development in OECD countries. Oeconomia Copernicana, 12(1), 11–34. https://doi.org/10.24136/oc.2021.001 Sonnino, R., & McWilliam, S. (2011). Food waste, catering practices and public procurement: A case study of hospital food systems in Wales. Food Policy, 36(6), 823–829. https://doi.org/10.1016/j.foodpol.2011.09.003 Spangenberg, J. H., & Lorek, S. (2002). Environmentally sustainable household consumption: from aggregate environmental pressures to priority fields of action. Ecological Economics, 43(2–3), 127–140. www.elsevier.com/locate/ecolecon Stocker, A., Großmann, A., Madlener, R., & Wolter, M. I. (2011). Sustainable energy development in Austria until 2020: Insights from applying the integrated model “e3.at.” Energy Policy, 39(10), 6082–6099. https://doi.org/10.1016/j.enpol.2011.07.009 Suleimenov, M., & Oram, P. (2000). Trends in feed, livestock production, and rangelands during the transition period in three Central Asian countries. In Food Policy (Vol. 25). www.elsevier.com/locate/foodpol Svenfelt, Å., Alfredsson, E. C., Bradley, K., Fauré, E., Finnveden, G., Fuehrer, P., Gunnarsson-Östling, U., Isaksson, K., Malmaeus, M., Malmqvist, T., Skånberg, K., Stigson, P., Aretun, Å., Buhr, K., Hagbert, P., & Öhlund, E. (2019). Scenarios for sustainable futures beyond GDP growth 2050. Futures, 111, 1–14. https://doi. org/10.1016/j.futures.2019.05.001 Tang, Y., Wu, S., & Chen, S. (2022). Evaluating the influence of environmental R&D on the SO2 intensity in China: Evidence from dynamic spatial Durbin model analysis. The economic dimension of sustainable development 45 Economic Research-Ekonomska Istrazivanja, 36(1), 1886–1905. https://doi.org/10.10 80/1331677X.2022.2094438 Teklewold, H., Kassie, M., & Shiferaw, B. (2013). Adoption of multiple sustainable agricultural practices in rural Ethiopia. Journal of Agricultural Economics, 64(3), 597– 623. https://doi.org/10.1111/1477-9552.12011 Troncoso, K., & Soares da Silva, A. (2017). LPG fuel subsidies in Latin America and the use of solid fuels to cook. Energy Policy, 107, 188–196. https://doi.org/10.1016/j. enpol.2017.04.046 van Dam, Y. K., & van Trijp, H. C. M. (2011). Cognitive and motivational structure of sustainability. Journal of Economic Psychology, 32(5), 726–741. https://doi. org/10.1016/j.joep.2011.06.002 Vandeventer, J. S., Cattaneo, C., & Zografos, C. (2019). A degrowth transition: Pathways for the degrowth niche to replace the capitalist-growth regime. Ecological Economics, 156, 272–286. https://doi.org/10.1016/j.ecolecon.2018.10.002 Vringer, K., & Blok, K. (2000). Long-term trends in direct and indirect household energy intensities: A factor in dematerialisation? Energy Policy, 28(10), 713–727. Wan, G., Wang, C., Wang, J., & Zhang, X. (2022). The income inequality-CO2 emissions nexus: Transmission mechanisms. Ecological Economics, 195. https://doi. org/10.1016/j.ecolecon.2022.107360 Wang, E. Z., Lee, C. C., & Li, Y. (2022). Assessing the impact of industrial robots on manufacturing energy intensity in 38 countries. Energy Economics, 105. https://doi. org/10.1016/j.eneco.2021.105748 Wang, Y., Xiong, S., & Ma, X. (2022). Carbon inequality in global trade: Evidence from the mismatch between embodied carbon emissions and value added. Ecological Economics, 195. https://doi.org/10.1016/j.ecolecon.2022.107398 West, J., Schandl, H., Krausmann, F., Kovanda, J., & Hak, T. (2014). Patterns of change in material use and material efficiency in the successor states of the former Soviet Union. Ecological Economics, 105, 211–219. https://doi.org/10.1016/j.ecolecon.2014.06.013 Wilts, H., & O’Brien, M. (2019). A policy mix for resource efficiency in the EU: Key instruments, challenges and research needs. Ecological Economics, 155, 59–69. https:// doi.org/10.1016/j.ecolecon.2018.05.004 Xie, P., & Jamaani, F. (2022). Does green innovation, energy productivity and environmental taxes limit carbon emissions in developed economies: Implications for sustainable development. Structural Change and Economic Dynamics, 63, 66–78. https://doi. org/10.1016/j.strueco.2022.09.002 Yuan, R., & Wang, J. (2021). Impacts of poverty alleviation on household GHG footprints in China. Energy Economics, 103. https://doi.org/10.1016/j.eneco.2021.105602 Zawieska, J., & Pieriegud, J. (2018). Smart city as a tool for sustainable mobility and transport decarbonisation. Transport Policy, 63, 39–50. https://doi.org/10.1016/j. tranpol.2017.11.004 Zegras, P. C. (2007). As if Kyoto mattered: The clean development mechanism and transportation. Energy Policy, 35(10), 5136–5150. https://doi.org/10.1016/j. enpol.2007.04.032 Zhang, H., Razzaq, A., Pelit, I., & Irmak, E. (2022). Does freight and passenger transportation industries are sustainable in BRICS countries? Evidence from advance panel estimations. Economic Research-Ekonomska Istrazivanja, 35(1), 3690–3710. https:// doi.org/10.1080/1331677X.2021.2002708 DOI: 10.4324/9781003379409-6 4 The social dimension of sustainable development Katarzyna Filipowicz Introduction As a complex issue, the social dimension of sustainable development is easier to define using indicators. Indicators can be a part of disaggregated scoreboards (Sustainable Development Goals (SDGs), Doughnut Economics) or highly aggregated measures. Both approaches have some advantages as well as some limitations. Non-aggregated indicators allow us to see differences in individual categories and identify areas requiring intervention. On the other hand, aggregated measures perform very well in cross-country comparisons. The social dimension in SGDs and Doughnut economics SDGs related to the social dimension The general concept of SDGs has already been discussed in Chapter 2. In this section, the focus will be on eight SDGs related to the social dimension. These goals call for the eradication of poverty and hunger, peace and social justice, access to quality healthcare and education, and highlight the aspects of gender equality, sustainable urban development and access to clean energy (DSDG, n.d.). It should be emphasised that the goals of sustainable development are interrelated. The foundation for social development is the appropriate protection of the biosphere, and the above-mentioned social goals are the basis for those related to the economy (Stockholm Resilience Centre, 2017). Table 4.1 presents the social goals of sustainable development and the number of targets and indicators related to these goals. In total, the social dimension is described by 74 targets and 124 indicators. The selected problems and data related to the social goals of sustainability are discussed below. The described challenges and indicators can be a starting point for further debate about this complex issue. The social dimension of sustainable development 47 No poverty The first challenge for the social dimension of sustainable development is to end poverty in all its forms everywhere (DSDG, n.d.). There is no single, accepted definition of poverty. Poverty is a very subjective category – poverty in Ethiopia is something different from poverty in the US. In 1990 The World Bank, together with a group of independent researchers, created a methodological framework for the international poverty line (IPL). Currently, IPL is calculated as the median of the 28 national poverty lines of the poorest countries. It is expressed in the 2017 PPP (World Bank Data Help Desk, n.d.). In September 2022, the World Bank set a new IPL at a level of $2.15 per person per day, replacing the previous limit of $1.90 per person per day (World Bank, 2022). Table 4.2 shows the medians of national poverty lines for different income groups of countries. The poverty line in high-income countries is $22.21 higher than in low-income countries (i.e. IPL). Therefore, it is very difficult to make international comparisons of this issue. Table 4.1 SDGs related to the social dimension of sustainable development Goals Targets Indicators Goal 1: No poverty 7 14 Goal 2: Zero hunger (No hunger) 8 13 Goal 3: Good health and well-being 13 28 Goal 4: Quality education 10 11 Goal 5: Gender equality 9 14 Goal 7: Affordable and clean energy 5 6 Goal 11: Sustainable cities and communities 10 15 Goal 16: Peace, justice and strong institutions 12 23 Total 74 124 Source: own study based on SDG Tracker (n.d.). Table 4.2 Global poverty lines with harmonised national poverty lines Income classification Median (2017 PPP) Number of countries (observations) Low-income countries 2.15 28 Lower-middle income countries 3.63 54 Upper-middle income countries 6.85 37 High-income countries 24.36 38 Total 157 Source: Jolliffe et al. (2022). 48 Katarzyna Filipowicz Zero hunger The second social challenge is ending hunger, achieving food security and improved nutrition and promoting sustainable agriculture (DSDG, n.d.). The Food and Agriculture Organization (FAO) defines hunger as: an uncomfortable or painful physical sensation caused by insufficient consumption of dietary energy. It becomes chronic when the person does not consume a sufficient amount of calories (dietary energy) on a regular basis to lead a normal, active and healthy life. (FAO, n.d.) Figure 4.1 shows two indicators: the global number of people undernourished and the prevalence of undernourishment in 2004–2021. In 2021, the number of people undernourished was 767.9 million, and the prevalence of undernourishment was 9.8%. In the years 2004–2010, there was a noticeable downward trend in both indicators, then in 2011–2018 the indicators were at a stable level, and then from 2019, an upward trend can be observed. The COVID-19 pandemic is indicated as the main cause of the increasing number of people undernourished in recent years (FAO, 2022). Good health and well-being The third social goal is to ensure healthy lives and promote well-being for all at all ages (DSDG, n.d.). One of the main factors influencing the health of a society is the quality of its healthcare. The quality of healthcare is mostly determined by the health spending in a given country. According to Global Burden of Disease (GBD) estimates, health expenditure per capita in 2016 in high-income countries 0.0% 2.0% 4.0% 6.0% 8.0% 10.0 % 12.0 % 14.0 % 0 10 0 20 0 30 0 40 0 50 0 60 0 70 0 80 0 90 0 Number of people undernourished (million) Prevalence of undernourishment Figure 4.1 Global number of people undernourished and prevalence of undernourishment in 2004–2021 Source: Based on data from FEOSTAT. The social dimension of sustainable development 49 Table 4.3 Health spending for different income groups of countries in 2016 Income classification Health spending per capita, 2016 ($PPP) Health spending per GDP, 2016 Government health spending per total health spending, 2016 High income 5,621 10.8% 79.6% (5,548–5,693) (10.6–10.9) (78.2–81.1) Upper-middle income 1,009 5.0% 53.9% (948–1,072) (4.7–5.3) (49.9–58.6) Lower-middle income 274 3.2% 32.1% (247–303) (2.9–3.5) (28.4–36.1) Low income 125 5.1% 26.3% (119–132) (4.9–5.4) (23.3–29.5) Source: Global Burden of Disease Health Financing Collaborator Network (2019). was $5621, and in low-income countries $125. The government plays an important role in the system of healthcare – the share of government expenditure in health expenditure in high-income countries was 79.6% and in low-income countries 26.3% (see Table 4.3). Quality education The fourth social issue is to ensure inclusive and quality education for all and to promote lifelong learning (DSDG, n.d.). Historical data on the literate and illiterate world population are moderately optimistic. The global percentage of people who could read in 2020 was around 87%, in 1950 it was around 56% (see Figure 4.2 (Roser & Ortiz-Ospina, 2016)). 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Literate world population (%) Illiterate world population (%) Figure 4.2 Literate and illiterate world population (among people aged 15 and older) Source: Based on data from the website Our World in Data and The World Bank. 50 Katarzyna Filipowicz However, the disparities between high and low-income countries in this basic indicator are still significant. In 2020, in low-income countries, the proportion of the literate population was at the level of 61%, and in upper-middle income countries 96% (see Table 4.4). Gender equality The next social challenge is to achieve gender equality and empower all women and girls (DSDG, n.d.). Gender inequality is a problem in most countries of the world. It manifests itself, for example by gender division of labour, occupational segregation, or gender wage gap. Figure 4.3 presents the distribution of work time based on data from the report International Labour Organization (ILO, 2018). The main conclusion from the data is that women work longer than men per day, regardless of the country’s income group. Additionally, women mainly 265 83 262 89 267 66 257 135 183 322 193 290 192 346 154 249 0 50 100 150 200 250 300 350 400 450 500 WomenMen WomenMen WomenMen Wome nM en WorldLow-income countries Middle-income countries High-income countries Minutes per day Unpaid care work Paid work Figure 4.3 Gender division of labour Source: based on data from ILO (2018). Table 4.4 Literacy rate, adult total (% of people ages 15 and above) Income classification 2005 2010 2015 2020 Low income 53% 54% 59% 61% Lower middle income 67% 71% 74% 76% Middle income 81% 84% 85% 87% Upper middle income 92% 94% 95% 96% Source: Based on data from the World Bank website. The social dimension of sustainable development 51 do unpaid work. Even in high-income countries, the disparities are significant (women’s unpaid work is 257 minutes a day, men’s 135 minutes). Affordable and clean energy The next social issue is ensuring access to affordable, reliable, sustainable and modern energy (DSDG, n.d.). This problem can be divided into two aspects: ensuring access to energy and changes toward clean energy. Map 4.1 shows the percentage of the population with access to electricity – there are still many countries (especially in Africa) with limited access to electricity. The second aspect of the problem concerns the sources of energy. Clean energy is related to the ecological dimension of sustainable development and is one of the main challenges of highly developed countries. Sustainable cities and communities The next goal of the social dimension is to make cities inclusive, safe, resilient and sustainable (DSDG, n.d.). There is a link between sustainable urban development and human health. Table 4.5 lists the diseases that are the most common cause of death (top 10) and shows the impact of faulty urban design and planning policies. The World Health Organization has launched a new Urban Health Initiative. This new initiative is to create a model of a city that is more climatefriendly and supports a healthy lifestyle for residents. The results obtained by the WHO can be used by the city authorities to conduct urban policy more effectively (World Health Organization, 2019). Map 4.1 Access to electricity (% of the population) Source: Based on data from the website Our World in Data. 58 Katarzyna Filipowicz Republic (8.0), Chad (8.0), Sudan (7.9), Djibouti (7.4), Mali (7.4), Niger (7.0) and South Sudan (5.5, see Map 4.4). Sustainable Society Index The Sustainable Society Index (SSI) was developed by the Dutch Sustainable Society Foundation in 2006. Since 2019, the SSI has been managed by TH Köln. Now it is available for 213 countries/territories. The SSI is made up of three dimensions of well-being: human, environmental and economic. These dimensions are not aggregated in this measure (TH Köln, n.d.). Human well-being consists of three categories and nine indicators: 1 Basic needs (sufficient food, sufficient drinking water and safe sanitation); 2 Personal development and health (education, healthy life and gender equality); 3 Well-balanced society (income distribution, population growth and good governance). Each indicator is rated on a scale from 1 to 10, where 1 denotes the weakest value and 10 denotes the strongest. The geometric mean is used to aggregate the individual dimensions (Van de Kerk, 2008). Map 4.5 shows the values of the human well-being dimension in 2018. Map 4.5 SSI – human well-being dimension in 2018 Source: Own study based on TH Köln data. The social dimension of sustainable development 59 The highest scores in the human well-being dimension of SSI in 2018 were achieved by the following territories: Bermuda (9.7), Virgin Islands (9.5), Andorra (9.4), Gibraltar (9.3), Faroe Islands (9.1), Finland (9.1), French Polynesia (9.1), Liechtenstein (9.1), New Caledonia (9.1), Hong Kong SAR, China (9.0), Puerto Rico (9.0), Barbados (8.9), Denmark (8.9), Portugal (8.9) and Slovenia (8.9). The lowest results were obtained by: Togo (4.4), Central African Republic (4.2), Yemen, Rep. (4.1), Congo, Rep. (4.0), Ethiopia (4.0), Guinea (4.0), Uganda (4.0), Chad (3.9), Zambia (3.9), Congo, Dem. Rep. (3.7), South Sudan (3.6), Guinea-Bissau (3.3), Somalia (3.3), Niger (3.2) and Equatorial Guinea (2.7). Better Life Index The Better Life Index (BLI) is an online, interactive tool, launched in 2011 and designed for the Organization for Economic Co-operation and Development (OECD) countries. The Better Life dashboard allows the user to set the level of importance for 11 components, including the following social ones: community, education, civic engagement, health, housing, jobs, life satisfaction, safety and work-life balance. The indicator combines all three dimensions of sustainability and it can be a good starting point in the discussion about what is essential from a welfare perspective (OECD, n.d.). Genuine Progress Indicator The GPI was developed in 1995 as a variant of the Index of Sustainable Economic Welfare. The GPI is a comprehensive sustainability indicator that incorporates all its three dimensions. This index consists of 26 components grouped into three categories. The social category is represented by the following elements: the value of housework and parenting, the cost of family changes, the cost of crime, the cost of household pollution abatement, the value of volunteer work, loss of leisure time, the value of higher education, the value of highways and streets, cost of commuting and cost of motor-vehicle crashes (Gross National Happiness USA, n.d.). The GPI is a monetary measure, which distinguishes this measure from those discussed above. The GPI is not yet ready for use in cross-country comparisons, mostly because of the evolving methodology, a large number of components and high data demands. So far, it has been estimated only for about 30 countries. However, the GPI is the indicator that measures overall well-being by adjusting for several negative externalities. What is important, as a monetary indicator, the GPI can be useful to evaluate the well-being impact of political actions (including social policy, Berik, 2020). 60 Katarzyna Filipowicz Conclusions The complexity of the social dimension of sustainable development makes it difficult to define and consequently to measure. Overall, the social dimension covers problems related to human well-being such as poverty, hunger, health, education, gender equality, energy supply, sustainable cities, peace and justice. Each of those components can be measured by various indicators. Due to the multifaceted nature of this dimension, it is necessary to define, explicitly and precisely, what we want to measure and for what purpose. Indicators describing the social dimension are elements of both disaggregated and aggregated measures of sustainable development. The eight SGDs are directly related to social problems, and the social foundations are a key part of the Doughnut model. Aggregated measures of sustainable development cover only selected social aspects that require a subjective assessment of the importance of the specific indicators. Finally, a country’s income level has a great impact on the goals and measurement of the social dimension, therefore, international comparisons should be approached with caution. It also has a very big influence on the selection of appropriate instruments of social policy to meet the most important challenges of this dimension. References Berik, G. (2020). Measuring what matters and guiding policy: An evaluation of the Genuine Progress Indicator. International Labour Review, 159: 71–94. https://doi. org/10.1111/ilr.12153. Davies, S., Pettersson, T., & Öberg, M. (2022). Organized violence 1989–2021 and drone warfare. Journal of Peace Research, 59(4), 593–610. https://doi. org/10.1177/00223433221108428 Division for Sustainable Development Goals (DSDG). (n.d.). The 17 goals. United Nations Department of Economic and Social Affairs (UNDESA). Retrieved October 19, 2022, from https://sdgs.un.org/goals. Fanning, A. L., O’Neill, D. W., Hickel, J., et al. (2022). The social shortfall and ecological overshoot of nations. Nature Sustainability, 5, 26–36. https://doi.org/10.1038/ s41893-021-00799-z FAO. (n.d.). Hunger and food insecurity. Retrieved October 19, 2022, from https://www. fao.org/hunger/en FAO, IFAD, UNICEF, WFP and WHO. (2022). The State of Food Security and Nutrition in the World 2022. Repurposing food and agricultural policies to make healthy diets more affordable. Rome, FAO. https://doi.org/10.4060/cc0639en. Fuchs, D., Schlipphak, B., Treib, O., Nguyen Long, L. A., & Lederer, M. (2020). Which way forward in measuring the quality of life? A critical analysis of sustainability and well-being indicator sets. Global Environmental Politics, 20(2): 12–36. doi: https:// doi.org/10.1162/glep_a_00554. Gleditsch, N. P., Wallensteen, P., Eriksson, M., Sollenberg, M., & Strand, H. (2002). Armed conflict 1946–2001: A new dataset. Journal of Peace Research, 39(5): 615–637. The social dimension of sustainable development 61 Global Burden of Disease Health Financing Collaborator Network. (2019). Past, present, and future of global health financing: a review of development assistance, government, out-of-pocket, and other private spending on health for 195 countries, 1995–2050. Lancet, 393(10187): 2233–2260. doi: 10.1016/S0140–6736(19)30841-4. Epub 2019 Apr 25. Gross National Happiness USA. (n.d.). Genuine progress indicator. Retrieved October 19, 2022, from https://gnhusa.org/genuine-progress-indicator/ Hickel, J. (2020). The sustainable development index: Measuring the ecological efficiency of human development in the Anthropocene. Ecological Economics, 167: 106331, ISSN 0921–8009, https://doi.org/10.1016/j.ecolecon.2019.05.011. International Labour Office. (2018). Care work and care jobs for the future of decent work. Geneva. Retrieved October 19, 2022, from https://www.ilo.org/wcmsp5/groups/ public/—-dgreports/—-dcomm/—-publ/documents/publication/wcms_633135.pdf Jolliffe, D. M., Mahler, D. G., Lakner, C., Atamanov, A., & Tetteh Baah, S. K. (2022). Assessing the impact of the 2017 PPPs on the international poverty line and global poverty. Washington, DC: World Bank. Retrieved October 19, 2022, from https://openknowledge.worldbank.org/handle/10986/37061 OECD. (n.d.). Better Life Index. Retrieved October 19, 2022, from https://www.oecdbetterlifeindex.org/ Pettersson, T. (2022). UCDP/PRIO Armed Conflict Dataset Codebook v 22.1, Retrieved October 19, 2022, from https://ucdp.uu.se/downloads/ Raworth, K. (2017). Doughnut economics: Seven ways to think like a 21st century economist. Vermont: White River Junction. Roman, P., & Thiry, G. (2017). Sustainability indicators. In C. L. Spash (Ed.), Routledge handbook of ecological economics: Nature and society (1st ed.). Routledge. https://doi. org/10.4324/9781315679747. Roser, M., & Ortiz-Ospina E. (2016). Global education. Published online at OurWorldInData.org. Retrieved October 19, 2022, from https://ourworldindata.org/ global-education SDG Tracker. (n.d.). Measuring progress towards the Sustainable Development Goals. Our World in Data. Retrieved October 19, 2022, from https://sdg-tracker.org/ Stockholm Resilience Centre. (2017, February 28). Contributions to agenda 2030. Retrieved October 19, 2022, from https://www.stockholmresilience.org/research/ research-news/2017-02-28-contributions-to-agenda-2030.html TH K öln. (n.d.). Sustainable Society Index (SSI). Retrieved October 19, 2022, from https://ssi.wi.th-koeln.de/index.html UNDP Human Development Reports. (n.d.a). Human Development Index (HDI). Retrieved October 19, 2022, from https://hdr.undp.org/data-center/human-development-index#/ indicies/HDI UNDP Human Development Reports. (n.d.b). Human Development Index: Technical notes. Retrieved October 19, 2022, from https://hdr.undp.org/sites/default/ files/2021-22_HDR/hdr2021-22_technical_notes.pdf University of Leeds. (n.d.). A good life for all within planetary boundaries. Retrieved October 19, 2022, from https://goodlife.leeds.ac.uk/about/ Van de Kerk, G., & Manuel, A. (2008). A comprehensive index for a sustainable society: The SSI – the Sustainable Society Index. Ecological Economics, 66(2–3): 228–242. Wellbeing Economy Alliance. (n.d.). Happy Planet Index. Retrieved October 19, 2022, from https://happyplanetindex.org/ 62 Katarzyna Filipowicz World Bank Data Help Desk. (n.d.). How is the international poverty line derived? How is it different from national poverty lines? World Bank. Retrieved October 19, 2022, from https://datahelpdesk.worldbank.org/knowledgebase/articles/ 193310-how-is-the-international-poverty-line-derived-how World Bank. (2022, September 14). Fact sheet: An adjustment to global poverty lines. Retrieved October 19, 2022, from https://www.worldbank.org/en/news/ factsheet/2022/05/02/fact-sheet-an-adjustment-to-global-poverty-lines World Health Organization. (2019). Sustainable cities: Health at the heart of urban development. Retrieved October 19, 2022, from https://www.who.int/ sustainable-development/cities/SDG_factsheet_sustainable_cities_EN_v3.pdf?ua=1 DOI: 10.4324/9781003379409-7 5 Environmental sustainability from the perspective of political economy Challenges and hope Zofia Łapniewska Introduction Hope has a utopian function, claims the German philosopher Ernst Bloch (1986).1 It is neither a wish nor a fantasy, but an emotion that allows us to anticipate the future in the present. An emotion we experience when we read reports on climate change, endangered species, or plastic pollution of the environment. We hope that new technologies, the progress of science and the solidarity of people, in particular of developed countries, will stop the ongoing changes and the next generations will be able to continue to enjoy a high quality of life on this planet using its resources. This chapter focuses on the most important environmental challenges facing humanity. The latest figures I refer to paint the future in rather dark colours and experts agree that action should be taken now. Using the achievements of the political economy of sustainability, as well as feminist and ecological economics, I point to proposals for actions that prefiguratively shape the image of the economy of the future in the service of nature and society. This unique contribution allows for a holistic view of the concept of environmental sustainability, which is central to the other dimensions described in this book – social and economic. Environmental sustainability Environmental sustainability is the foundation of overall sustainability, the integrity of all systems, including human-made social and economic systems. René Passet (1979) illustrated this fact as three sets, wherein it is the biosphere that determines the existence and prosperity of the other two (Figure 5.1). Environmental sustainability means that people conduct their activities on the planet (productive and reproductive) in such a way that it does not put pressure on the environment leading to a loss of biodiversity and irreversible changes in ecosystems. At the same time, the resources used are regenerated, wellmaintained and cultivated, so that future generations have equal chances for a good life. Sustainability combines the concern for the natural environment and its condition with the social and economic expectations of humankind. As early 64 Zofia Łapniewska as 1965, in his famous essay “Earth as a Space Ship”, Kenneth Boulding wrote about treating the planet as an entirety and humans as one of the species that inhabit it: Man is finally going to have to face the fact that he is a biological system living in an ecological system, and that his survival power is going to depend on his developing symbiotic relationships of a closed-cycle character with all the other elements and populations of the world of ecological systems. (Boulding, 1965)2 Although Boulding’s text clearly indicates the material boundaries of the planet, describing it as a closed system, he did not take into account the constant supply of (solar) energy to this system, which guarantees growth, support of life and processing of materials (e.g. recycling) and goods that eventually go back to the environment. When the first definitions of environmental sustainability were created in the early 1990s, the focus was primarily on protecting the sources of raw materials and “ensuring that the sinks for human wastes are not exceeded, in order to prevent harm to humans” (Goodland, 1995), which means the topic of “limits to growth” (Meadows et al., 1972) in Anthropocene was continued. However, this definition was broadened – as if in response to the Brundtland Commission report (WCED, 1987) – by including bio-geophysical aspects in the publication of the World Bank (Holdren et al., 1995), where the term “biophysical sustainability” is defined as strengthening the integrity of systems supporting life on Earth. The author also pointed out that both biological diversity and the Figure 5.1 The economy embedded in the institutions of human society and in the biosphere Source: Martinez-Alier & Muradian, 2015, p.2; after Passet, 1979, p.4. Environmental sustainability 65 bio-geochemical integrity of the biosphere (proper use and conservation of natural resources – land, water and air) are important. The topic of sustainability was widely discussed at the beginning of the 21st century and was taken up by many organisations (e.g. OECD, 2001). Reading these studies shows that the central role in them is played not by the economy (and further growth), but by the environment or harmony with it – as the Boulding essay indicates. Here, ecological economics provided support, pointing out that the interdependence of natural ecosystems and the economy should be considered, as well as the dimensions of time and space (Xepapadeas, 2008, pp. 3258–3271). This is especially important when we think about intergenerational justice and the ability of the environment to regenerate, including irreversible changes, for example the prospective loss of almost a million species that are currently endangered (IPBES, 2019, p. XVI); and on spatial justice, on the strength of which some species-rich areas or reservoirs should be particularly well-protected (and extended) and others, sensitive to climate change – where the life and health of people and other species inhabiting them are endangered, for example by hurricanes and floods in the countries of the Global South – should be strengthened and prepared for weather shocks. Justice in this sense means that the countries that have contributed most to climate change should be accountable for the effects of their actions and first minimise their environmental impact (ideally to zero) and help other countries to cope with these effects as well as to help them transform their economies into zeroor low-carbon economies. Environmental economists (Parrique et al., 2019) agree that it is impossible to separate economic growth from greenhouse gas emissions (a phenomenon known as “decoupling”). Therefore, highly developed countries should move to the degrowth phase in order to leave less-developed countries some space for development without exhausting the planet’s resources and not leading to irreversible damage to the environment. As part of the concept of environmental sustainability, scientists from the Stockholm Resilience Centre (SRC) indicate nine major planetary boundaries (Figure 5.2), the crossing of which “increases the risk of generating large-scale abrupt or irreversible environmental changes” (SRC, 2022). The areas of the “ecological ceiling” (Figure 5.2) were defined in 2009 by 28 scientists, invited to quantify the biophysical limits within which humanity will continue to develop and prosper for generations to come (Rockström et al., 2009). The nine systems are climate change (measured by atmospheric CO2 concentration and change in radiative forcing), biodiversity loss (measured by extinction rate), biogeochemical flows (measured by the amount of nitrogen (N2) removed from the atmosphere and phosphorus flowing into the oceans), change in land use (global land converted to cropland), novel entities (including plastic pollution), freshwater change (division into green water from rainfall and blue water consumed by people), ocean acidification, stratospheric ozone depletion and atmospheric aerosol loading (not quantified yet). The first six limits mentioned above have already been exceeded (Steffen et al., 2015; Persson 66 Zofia Łapniewska et al., 2022; Wang-Erlandsson et al., 2022). As indicated in the last report of the Intergovernmental Panel on Climate Change (IPCC), this is the last warning, and we are already on the path of no return (IPCC, 2022). Complementary to the illustration of boundaries above (Figure 5.2), is the concept of “the doughnut” by Kate Raworth (2017). On the one hand, the author takes into account the boundaries of biophysical systems determined by the SRC, and on the other, she adds the necessary socio-economic minimum that defines the conditions that must be met for humans to live in harmony and flourish (side by side with other species). Since this concept was presented in detail in the previous chapter, I will not be discussing it here. Rather, my intention is to emphasise the interpenetration of all three areas (Figure 5.1) and their close interdependence, which we must consider when designing economic or social changes, guided by the precautionary principle (Article 191 of the Treaty on the Functioning of the European Union). Figure 5.2 The planetary boundaries framework Source: J. Azote for Stockholm Resilience Centre, based on analysis in Persson et al., 2022; WangErlandsson et al., 2022 and Steffen et al., 2015. Environmental sustainability 67 Main challenges for environmental sustainability Although it would seem that the critical reflection on the influence of humankind on climate change appeared in the public discourse relatively recently, the first observations of the influence of excessive concentration of CO2 in the atmosphere on its heating by sunlight were made by Eunice Newton Foote in 1856 (Sorenson, 2011). She concludes her discovery with the words: An atmosphere of that gas would give to our earth a high temperature; and if as some suppose, at one period of its history the air had mixed with it a larger proportion than at present, an increased temperature from its own action as well as from increased weight must have necessarily resulted. (Newton Foote 1856, p. 383) It can be said that her warning from the period of the first industrial revolution was understood by us only, the witnesses of the fourth, over 150 years later. What is the condition of the planet’s environment today? What is the diagnosis by the most important research institutions? The latest comprehensive IPCC publication “Sixth Assessment Report: Impacts, Adaptations and Vulnerability”, is the best source of data we currently have about the changing climate. The report was based on the analysis of 18,000 scientific studies by 278 authors from 65 countries (IPCC, 2022). They inform that even if we manage to stop the temperature rise at 1.5 degrees Celsius compared to the pre-industrial period, sea levels will rise, the ice cover will largely melt, and some ecosystems will be irretrievably lost. The authors calculate that in the “carbon budget” we only have 510 gigatonnes of CO2 equivalent left, while in the decade 2010–2019 we emitted an average of 56 gigatonnes into the atmosphere annually (IPCC AR6 WG III, 2022, p.4). They also note that 34– 45% of global emissions are produced by the richest 10% of households (IPCC AR6 WG III, 2022, p. 8). To stem the current rise in temperature, which is heading towards 3 degrees Celsius in 2100, it is necessary to reduce CO2 emissions by 48% and emissions of methane (mainly from livestock) by one-third by 2030, and in the following years, consistently reduce coal consumption by 95%, oil by 60% and gas by 45% by 2050. The report was prepared before Russia’s aggression against Ukraine, so on the one hand, huge amounts of CO2 are emitted as a result of destruction and weapon production, and on the other, restrictions on fossil fuels trade with Russia may contribute to a faster energy transformation (at least in European countries). The scientists preparing the report developed over 1,000 scenarios based on the Paris Agreement (see Chapter 1 in this book), of which only a little over 100 predict that the temperature rise will be kept below 2 degrees Celsius (IPCC, 2022). They all assume that apart from a radical reduction in emissions, new negative emission technologies will have to be used to recover CO2 previously emitted. For now, however, humankind does 74 Zofia Łapniewska Cai, Y., Lenton, T. M., & Lontzek, T. S. (2016). Risk of multiple interacting tipping points should encourage rapid CO2 emission reduction. Nature Climate Change, 6(5), 520– 525. https://doi.org/10.1038/NCLIMATE2964 CBD (2012). Strategic Plan for Biodiversity 2011–2020 and the Aichi Targets “Living in Harmony with Nature”. Secretariat of the Convention on Biological Diversity. Dafermos, Y., Nikolaidi, M., & Galanis, G. (2017). A stock-flow-fund ecological macroeconomic model. Ecological Economics, 131, 191–207. https://doi.org/10.1016/j. ecolecon.2016.08.013 Dhamoon, R. (2011). Considerations on mainstreaming intersectionality. Political Research Quarterly, 64(1), 230–243. https://doi.org/10.1177/1065912910379227 Dupuy, J. P. (2009, October 15). The precautionary principle and enlightened doomsaying: Rational choice before the apocalypse. Occasion: Interdisciplinary Studies in the Humanities, 1(1), 1–13. ECA (2022). Energy Taxation, Carbon Pricing and Energy Subsidies. Review 01. European Court of Auditors. https://www.eca.europa.eu/Lists/ECADocuments/RW22_01/ RW_Energy_taxation_EN.pdf EEA (2022). End-of-Pipe Technology. European Environment Agency. Retrieved November 8, 2022, from https://www.eea.europa.eu/help/glossary/ gemet-environmental-thesaurus/end-of-pipe-technology Emerson, J., Esty, D. C., Levy, M. A., Kim, C. H., Mara, V., de Sherbinin, A., & Srebotnjak, T. (2010). 2010 Environmental Performance Index. Yale Center for Environmental Law and Policy. Georgescu-Roegen, N. (1971). The entropy law and the economic process. Harvard University Press. Goodland, R. (1995). The concept of environmental sustainability. Annual Review of Ecology and Systematics, 26, 1–24. Haberl, H., Fischer-Kowalski, M., Krausmann, F., Martinez-Alier, J., & Winiwarter, V. (2011). A socio-metabolic transition towards sustainability? Challenges for another great transformation. Sustainable Development, 19, 1–14. https://doi.org/10.1002/sd.410 Hausknost, D. (2017). Degrowth and democracy. In C. L. Spash (Ed.), Routledge Handbook of Ecological Economics, Nature and Society (pp. 457–466). Routledge. Holdren, J. P., Daily, G. C., & Ehrlich, P. R. (1995). The meaning of sustainability: biogeophysical aspects. In: Munasingha, M., Shearer, W. (Eds.), Defining and Measuring Sustainability (pp. 3–17). Washington: The World Bank. IPBES (2019). Global assessment report of the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services, Brondízio, E. S., Settele, J., Díaz, S., Ngo, H. T. (Eds). IPBES secretariat. IPCC (2022). Climate Change 2022: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change, H.-O. Pörtner, D.C. Roberts, M. Tignor, E.S. Poloczanska, K. Mintenbeck, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, A. Okem, B. Rama (Eds.). Cambridge University Press. https://doi.org/10.1017/9781009325844 IPCC AR6 WG III (2022). Climate Change 2022: Mitigation of Climate Change, Summary for Policymakers. Working Group III contribution to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change. WMO, UNEP. Koch, M. (2017). Human Induced Climate Change from a Political Economy Perspective. In C. L. Spash (Ed.), Routledge Handbook of Ecological Economics (pp. 436– 444). Routledge. Environmental sustainability 75 Kolbert, E. (2021). Under a White Sky: The Nature of the Future. Crown. Kyushu University (2021). Twenty-Four Trillion Pieces of Microplastics in the Ocean and Counting, Kyushu University. https://www.kyushu-u. ac.jp/f/45716/21_10_27_en.pdf Łapniewska, Z. (2022a). Przedmioty, prefiguracja i ucieleśnione doświadczenia: gospodarka dla społeczeństwa. In M. Dziedzic, J. Krokosz & M. Mach (Eds.), PSO KMP WFP ASP (pp. 54–61). Academy of Fine Arts in Kraków. Łapniewska, Z. (2022b). Solidarity and mutual aid: Women organizing the “visible hand” urban commons. Gender, Work & Organization, 29(5), 1405–1427. https://doi. org/10.1111/gwao.12833 Leach, D.K. (2013). Prefigurative politics. In D. A. Snow, D. della Porta, B. Klandermans, & D. McAdam (Eds.), The Wiley-Blackwell Encyclopedia of Social and Political Movements (pp. 1–2). Blackwell Publishing. Leclère, D., Obersteiner, M., Barrett, M., et al. (2020). Bending the curve of terrestrial biodiversity needs an integrated strategy. Nature, 585, 551–556. https://doi.org/10.1038/ s41586-020-2705-y Lenton, T. M. (2021). Tipping points in the climate system. Weather, 76(10), 325–326. https://doi.org/10.1002/wea.4058Martinez-Alier, J., & Muradian, R. (Eds.) (2015). Handbook of Ecological Economics. Edward Elgar Publishing. Meadows, D. H., Meadows, D. L., Randers, J., & Behrens, III. (1972). The Limits to Growth. Potomac Associates – Universe Books. Mignolo, W. D. (2009). The communal and the decolonial. Turbulence, 5, 29–31. Moore, Ch. (2022, August 26). Plastic pollution. Encyclopedia Britannica. Retrieved October 26, 2022, from https://www.britannica.com/science/plastic-pollution Newton Foote, E. (1856). Circumstances affecting the Heat of the Sun’s Rays. The American Journal of Science and Arts, 22 (66), 382–383. OECD (2001). OECD Environmental Strategy for the First Decade of the 21st Century. Organisation for Economic Co-operation and Development. Orr, J., Fabry, V., Aumont, O., et al. (2005). Anthropogenic ocean acidification over the twenty-first century and its impact on calcifying organisms. Nature, 437, 681–686. https://doi.org/10.1038/nature04095 Parrique, T., Barth, J., Briens, F., C. Kerschner, Kraus-Polk, A., Kuokkanen, A., & Spangenberg, J. H. (2019). Decoupling debunked: Evidence and arguments against green growth as a sole strategy for sustainability. European Environmental Bureau. Passet, R. (1979). L’Économique et le vivant. Payot. Persson, L., Carney Almroth, B., Collings, C. D., Cornell, S., de Wit, C. A., et al. (2022). Outside the safe operating space of the planetary boundary for novel entities. Environmental Science & Technology, 56(3), 1510–1521. https://doi.org/10.1021/acs.est.1c04158 Raven, J. et al. (2005). Ocean Acidification due to Increasing Atmospheric Carbon Dioxide. The Royal Society. Raworth, K. (2017). Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist. Random House. Ridgwell, A., & Schmidt, D. N. (2010). Past constraints on the vulnerability of marine calcifiers to massive carbon dioxide release. Nature Geoscience, 3, 196–200. https:// doi.org/10.1038/ngeo755 Ritchie, H. (2022, October 11). Ocean plastics: How much do rich countries contribute by shipping their waste overseas? Our World in Data. Retrieved October 21, 2022, fromhttps://ourworldindata.org/plastic-waste-trade 76 Zofia Łapniewska Rockström, J., Steffen, W., Noone, K., et al. (2009). A safe operating space for humanity. Nature, 461, 472–475. https://doi.org/10.1038/461472a SCBD (2020). Global Biodiversity Outlook 5. Secretariat of the Convention on Biological Diversity. Sorenson, R. P. (2011). Eunice Foote’s pioneering research on co2 and climate warming. Search and Discovery, 70092. https://www.searchanddiscovery.com/pdfz/ documents/2011/70092sorenson/ndx_sorenson.pdf.html Spash, C. (2011). Carbon trading: A critique. In J. Dryzek, R. Norgaard, & D. Schlosberg (Eds.), Oxford Handbook on Climate Change and Society (pp. 550–560). Oxford University Press. SRC (2022). Planetary boundaries. Stockholm Resilience Centre. Retrieved October 18, 2022, from https://www.stockholmresilience.org/research/planetary-boundaries.html Steffen, W., Richardson, K., Rockström, J., Cornell, S. E., Fetzer, I., Bennett, E. M., Biggs, R., Carpenter, S. R., de Vries, W., de Wit, C. A., Folke, C., Gerten, D., Heinke, J., Mace, G. M., Persson, L. M., Ramanathan, V., Reyers, B., & Sörlin, S. (2015). Planetary boundaries: Guiding human development on a changing planet. Science, 347(6223), 736. https://doi.org/10.1126/science.1259855 UNEP (2022). Our planet is choking on plastic. United Nations Environment Programme. Retrieved October 21, 2022, from https://www.unep.org/interactives/ beat-plastic-pollution/ Wang-Erlandsson, L., Tobian, A., van der Ent, R. J., et al. (2022). A planetary boundary for green water. Nature Reviews Earth & Environment, 3, 380–392. https://doi. org/10.1038/s43017-022-00287-8 WCED (1987). Our common future. Oxford University Press. Wolf, M. J, Emerson, J. W., Esty, D. C., de Sherbinin, A., Wendling, Z. A., et al. (2022). 2022 Environmental Performance Index. Yale Center for Environmental Law & Policy. WWF (2016). Living Planet Report 2016: Risk and Resilience in a New Era. WWF International. WWF (2020). Living Planet Report 2020: Bending the Curve of Biodiversity Loss. Almond, R. E. A., Grooten M. & Petersen, T. (Eds). WWF. https://www.wwf.fr/ sites/default/files/doc-2020-09/20200910_Rapport_Living-Planet-Report-2020_ ENGLISH_WWF-min.pdf Xepapadeas, A. (2008). Ecological economics. In S. N. Durlauf & L. E. Blume (Eds.) The New Palgrave Dictionary of Economics (2nd ed.) (pp. 3258–3271). Palgrave Macmillan. XR (2022). Global Support 2021 Annual Report. Extinction Rebellion. DOI: 10.4324/9781003379409-8 6 Multiple perspectives on sustainable development Agnieszka Żak Introduction Since the 1990s, sustainability has become a global issue that is receiving increasing attention (Ruggerio, 2021). It is a multidimensional endeavour to achieve a higher quality of life for all people (United Nations & Annan, 1997) in accordance with the anthropocentric concept of interand intra-generational equity (Spangenberg, 2004). Sustainability has many different implications and definitions. Some of these definitions and interpretations overlap, while others openly compete and contradict each other (Mazi, 2015). The most commonly cited one was developed by the UN Brundtland Commission (World Commission on Environment and Development, 1987) and centres around the concept of intergenerational justice. Due to its complexity, the concept of sustainability is being studied by many different scientific disciplines. In addition, the issue can be considered on both a macroeconomic and microeconomic scale. Thus, sustainability is widely presented in many books, research papers, agreements and treaties (D’Alisa, 2007). Economic development, social development and environmental protection are interdependent and mutually reinforcing elements of sustainability (United Nations & Annan, 1997). In the literature, this concept is known as “3Ps” – people, profit, planet (UN General Assembly, 2015) and “triple bottom line – TBL” (Elkington, 1998). As Purvis writes, the concept of “sustainable development” uses three interrelated “pillars” (Black, 2007), “dimensions” (Lemke & Bastini, 2020; Redclift, 1991), “components” (Du Pisani, 2006), “stool legs” (Dawe & Ryan, 2003), “aspects” (Lozano, 2008) or “perspectives” (Brown et al., 1987). The coherence of these three key elements is essential for achieving sustainable development (UN General Assembly, 2015). Classical sustainability, as traditionally conceived, presents a fragile, vulnerable, incomprehensible and rigid concept rather than a holistic and dynamic one (Raed Najjar, 2019). However, if we treat sustainable development as an evolutionary (Nonaka & Toyama, 2005) and dynamic (Bertinelli et al., 2008) concept we find that “sustainability” remains an open concept with myriad interpretations and understandings depending on the context (Purvis et al., 2019). 78 Agnieszka Żak The purpose of this chapter is to review the concept of the various dimensions of sustainable development. The three basic dimensions have been thoroughly discussed in the previous sections. In contrast, publications on a broader view of the dimensions of sustainable development are analysed below, of which between four and seven, are listed. The author’s intention was to objectively present the multidimensional concepts present in the literature, without comparing or evaluating them. Multiplicity in the perception of sustainable development In the process of creating the literature knowledge base, the international scientific electronic database Scopus was used. The subject of the analysis was the titles, subjects and abstracts of English-language, open-access articles containing the term “dimensions of sustainable development.” Initially, 128 articles were received. Most of them, however, dealt with three dimensions. The resulting collection of publications was supplemented with peer-reviewed articles from the Google Scholar online database and bibliographic items obtained using the “snowball” technique (Greenhalgh & Peacock, 2005). In the end, nearly 30 articles corresponding to the scope of the chapter were extracted for analysis. The main part of the text was divided into 4 subsections, devoted successively to four, five, six and seven dimensions of sustainability (see Table 6.1). Table 6.1 lists publications with the number of dimensions, their names and authors. There is a wide variety of concepts, names and characteristics of dimensions in the literature. Thus, for example, in publications devoted to the four dimensions, one can find at least five different statements on several industries (Cheng et al., 2009; Gallopín et al., 2014; Ke et al., 2021; Koff et al., 2022; Li et al., 2021; R. Najjar, 2022). Four dimensions In publications that list four dimensions of sustainable development, the most common are as follows: environmental, social, economic and institutional dimensions (Ávila et al., 2017; Hersen et al., 2019; Laxe et al., 2017; LizamaPérez et al., 2018; Londoño-Pineda et al., 2021; Spangenberg, 2004; Toumi et al., 2017; UN-CSD, 2007; Valentin & Spangenberg, 2000). The United Nations Commission on Sustainable Development (UN-CSD) considers the institutional dimension, along with the other three (economic, social and environmental), to be at the core of sustainable development (UNCSD, 2007). Following this, these four dimensions are mentioned by authors such as (Londoño-Pineda et al., 2021; Toumi et al., 2017). Very broadly defined, institutions for sustainable development should be understood as the rules by which decision-making for sustainability and its implementation are Multiple perspective on sustainable development 79 organised (Spangenberg, 2004). Most human activities, individually or collectively, involve all four dimensions, or at least the social and institutional Table 6.1 Results of the literature review on the dimensions of sustainable development Number of dimensions Name of dimensions Authors 4Economic, social, environmental/ ecological, institutional (Ávila et al., 2017; Hersen et al., 2019; Laxe et al., 2017; Lizama-Pérez et al., 2018; Londoño-Pineda et al., 2021; Spangenberg, 2004; Toumi et al., 2017; UN-CSD, 2007; Valentin & Spangenberg, 2000) Economy, society, environment, coordination (Li et al., 2021) Economic, social, environmental, security (Koff et al., 2022) Environmental, economic, social, transportation efficiency (Ke et al., 2021) Economic, ecological, environmental, multi – dimensions (Cheng et al., 2009) Economic, social, ecological, political – institutional (Gallopín et al., 2014) Social, economic, environmental, cultural-historical (R. Najjar, 2022) 5Economic, social, ecological, the built environment, political (Allen, 2009) Economic, social/ethical, environmental, technical and institutional (Bhattacharyya, 2012; Ebrahimi & Rahmani, 2019; Iddrisu & Bhattacharyya, 2015; Ilskog, 2008) New five-dimensional sustainability triangle: Place, Permanence, Persons (Iribarnegaray & Seghezzo, 2012; Seghezzo, 2009) Ecological, social, economic, cultural, safety (Tomaškinová et al., 2019, 2021) 6Moral, ecological, social, economic, legal, technical, political (Pawłowski, 2008) 7 Ecological, political, ethical, socio-economic, democratic, cultural, theological Vogt and Weber (2019) Economic, social, environmental, legal, political, ethical and cultural (González et al., 2021) Source: Own elaboration. 80 Agnieszka Żak dimensions (Spangenberg, 2004). Every use of natural resources relates to the environmental dimension, and every exchange of goods and services is economic. Since they are ubiquitous in human life, sustainable development can be understood as a normatively defined group of specific configurations in all four dimensions, characterised by the fact that their synergistic interaction produces multiple feasible paths leading to the stable development of the entire system. On the other hand, Gallopín in their publication conducted a discussion of sustainability and sustainable development in conceptual and visual terms (Gallopín et al., 2014). The authors consider these two perspectives to be complementary. The visual discussion compares integrated visualisations of sustainability and sustainable development, including not only the three basic dimensions but also the political–institutional dimension. In addition, the publication lists several other dimensions (ethical, cultural and global), without, however, providing their characteristics. An interesting, holistic view of the four dimensions is proposed by Najjar in the model four dimensional spatial sustainability (Raed Najjar, 2019). This model makes it possible to study the past, present and future of spatial sustainability on local and global scales. Sustainability in its classical definition exhibits significant temporal limitations in terms of spatial-linear analysis, since it includes only two categories: present and future. The lack of the past tense generates risks, threats and even problems, because it also ignores other very important aspects – cultural and historical dimensions (Raed Najjar, 2019). Najjar believes that while culture characterises a community’s identity, history is its mirror through which its deep-rooted stories, traditions and symbols can be read. Both culture and history reflect and establish temporal bridges between people and places. The primary goal of this dimension is to better understand and sustain the community’s culture and history to preserve it as much as possible but also to maintain community development. Cheng et al., in the analysis of sustainability, use a four-dimensional model: economic, ecological, environmental and multi-dimensions (Cheng et al., 2009). Within the framework of the “multi-dimensions” concept, the authors undertake considerations for the analysis of pairs of aspects: temporal versus spatial scale, capital versus assets, process versus capability, or means versus objectives. Another dimension is unsustainability, which in many cases, may become a more useful concept. People who have different opinions on the definition of sustainability may find out that they do have the same opinion about unsustainability, and they can work together to find the factors of unsustainability, their cause and the countermeasure to overcome them. In turn, Macnaghten and Jacobs, pointed out that it should pay more attention to cultural factors that control and support public participation in sustainability activities (Macnaghten & Jacobs, 1997). In Li et al., in the context of research on risk in Mega Infrastructure Projects (MIPs), implemented in sectors that significantly affect the economy, national security, environmental protection and society (Flyvbjerg, 2014), here is, in turn, Multiple perspective on sustainable development 81 a dimension of coordination (Li et al., 2021). Their implementation involves various project risks (Kardes et al., 2013). The authors emphasise that consideration of the coordination dimension is necessary to explore potential risks that may lead to imbalances in the three key pillars. Koff et al. define sustainable development through the approach promoted by Agenda 2030, which includes economic aspects, social justice, environmental protection and human security (Koff et al., 2022; UN General Assembly, 2015). Although security is not traditionally considered a dimension in the SDGs, the authors included it because, on the one hand, the “securitisation” of sustainability (Raco, 2007) is increasingly occurring at the supranational and national levels, and on the other, it has a local context (and security can be a priority political issue). The review of publications on the four dimensions closes with an article on the SDGs, which has a term in the abstract identical to the title of this chapter (multiple perspectives on sustainable development). The authors (Hajer et al., 2015) propose four combined perspectives that can reinforce the universal relevance of the Sustainable Development Goals (SDGs). However, they caution against a situation in which the SDGs and targets may carry the risk of not meeting expectations due to “cockpit-ism.” This term implies the illusion that topdown leadership by governments and intergovernmental organisations can solve global problems on their own. To counter this, new agents of change such as businesses, cities and civil society need to be further mobilised. A variety of perspectives on sustainability are needed for this: “planetary boundaries” (to reinforce the urgency of solving environmental problems), “the safe and just operating space” (to highlight the interconnectedness of social and environmental problems and their distributional consequences for industrialised countries and emerging economies), “the energetic society” (to develop responses to environmental change) and “green competition” (to stimulate innovation and new business practices). These four ideas can strengthen the link between the aforementioned entities, and thus support the universal relevance of the SDGs. Five dimensions In 2015, all UN member states adopted the 2030 World Development Strategy. The 2030 Agenda takes into consideration different realities, opportunities and levels of development, taking into account the policies and priorities adopted in each country (UN General Assembly, 2015). As mentioned earlier, the 17 SDGs contained therein can be divided into 5 areas, referred to as the “5Ps”: people, planet, prosperity, peace and partnership. By adding two key components: partnership and peace, the traditional idea of sustainability has taken on a new and richer meaning. True sustainable development lies at the heart of these five dimensions – it cannot be realised in the absence of peace and security, and peace and security will be compromised without sustainability (UN General Assembly, 2015). 82 Agnieszka Żak The need to redefine the concept of sustainability is also pointed out by Seghezzo, in his proposed concept of sustainability (Seghezzo, 2009). According to him, a new conceptual framework is needed to address sustainability issues, incorporating territorial, temporal and personal aspects of development (Seghezzo, 2009). He believes that space, time and human aspects are not independent of each other and interact in complex ways. Therefore, he proposes an alternative triangle of sustainability formed by the “new 3Ps”: “Place”, “Permanence” and “Persons”. Place, is the three-dimensional, physical, geographic, as well as culturally constructed space in which we live and interact, Permanence is the fourth dimension of time, and the category of Persons is symbolic of people as individuals, not as undifferentiated members of society. Place and Persons, the base of the triangle, represent “real”, objective and concrete things that exist in the present. Sustainability is a more “ideal,” abstract and subjective projection of events from other corners into the future. The five-dimensional framework of sustainability is, according to this author, probably more accessible and useful for outlining concrete policies for sustainable development. Place is an important component of social cohesion that helps build a sense of belonging to a culture. Geographic and cultural “place” is where intragenerational equity can be pursued (Iribarnegaray & Seghezzo, 2012). Permanence is the fourth dimension of time (t). It is essential for describing medium and long-term intergenerational equity issues and dealing with the future environmental consequences of current actions and inactions. The concept of place is not complete until a temporal component is included, for a sense of belonging to a place is often associated with things that took place at different, sometimes distant times. The concepts of justice and equality, while necessary to build a more sustainable world, are probably not sufficient to include a number of more personal aspects. These are the reasons why Seghezzo believes that the concept of sustainability should include a fifth and human dimension – Persons (i), necessary to deal with issues of identity, human rights, sense of belonging and personal happiness. The author cites numerous studies (Marks et al., 2006; O’Neill, 2008), that suggest that happiness and well-being are related to autonomy, freedom, achievement and the development of deep interpersonal relationships. Personal involvement may play a special role in the pursuit of better intergenerational justice (Iribarnegaray & Seghezzo, 2012). Other authors have also written about the need to address the five dimensions of sustainability, in different contexts and industries (Allen, 2009; Bhattacharyya, 2012; De Carvalho et al., 2015; Ebrahimi & Rahmani, 2019; Iddrisu & Bhattacharyya, 2015; Ilskog, 2008; Tomaškinová et al., 2021). For example, in the energy industry, research by (Bhattacharyya, 2012; Ebrahimi & Rahmani, 2019; Iddrisu & Bhattacharyya, 2015; Ilskog, 2008) showed the need for a modified model. Iddrisu and Bhattacharyya (Iddrisu & Bhattacharyya, Multiple perspective on sustainable development 83 2015), following (Bhattacharyya, 2012; Ilskog, 2008) concluded that assessing the sustainability of a country’s energy system is a five-dimensional issue, including social, institutional, economic, environmental and technical dimensions. Another author, who analyses the five-dimensional model of sustainability is Allen (Allen, 2009). Referring to the urban context, he mentions the dimensions of economic sustainability, social sustainability, environmental sustainability, the sustainability of the built environment and political sustainability. By analysing the essence of each of these aspects, it is possible to conclude that effective use of sustainability resources brings long-term benefits, ensures a certain standard of living, respects cultural heritage and cultural diversity, takes into account the interaction between the state and the use of environmental resources, buildings and infrastructure does not destroy and erode the environment. Political sustainability, which governs the other four dimensions involved in the relationship, is the unifying component of this model (Allen, 2009). On the other hand, in the context of protected area management strategies (Tomaškinová et al., 2021), it was emphasised that the development of protected areas towards sustainability requires new features, improved concepts and tools for new ways of planning. The authors highlight that protected area management strategies must take into account five dimensions of sustainable development, which cover a broad portfolio of scientific disciplines: ecological, social, cultural, economic and security (Tomaškinová et al., 2019). The authors believe that the benefits of sustainably integrating each dimension are so universal that they can apply to many sectors (Tomaškinová et al., 2021). Six dimensions An original approach to the issue of dimensions of sustainability is presented by A. Pawłowski, who, in the spirit of philosophical and moral considerations, proposes a six-dimensional construct (Pawłowski, 2008). The author sees sustainable development as a programme that integrates various spheres of human activity, often seen as separate from the past. Underlying this approach is the moral conviction, familiar from WCED’s (1987) definition, of humanity’s responsibility for nature, now and in the future. Integration means achieving order in each of the dimensions proposed by the author, which include: the moral dimension; the ecological dimension, the social dimension, the economic dimension, the legal dimension, the technical dimension and the political dimension. Pawłowski sees a hierarchical relationship in sustainable development: the highest dimension is moral issues, the next level is the ecological, social and economic dimensions, and finally the legal, technological and political dimensions. Full integration of these three levels is needed, but extremely difficult to achieve. 90 Agnieszka Żak Redclift, M. (1991). The multiple dimensions of sustainable development. Geography, 76(1), 36–42. Ruggerio, C. A. (2021). Sustainability and sustainable development: A review of principles and definitions. Science of the Total Environment, 786. https://doi.org/10.1016/j. scitotenv.2021.147481 Seghezzo, L. (2009). The five dimensions of sustainability. Environmental Politics, 18(4). https://doi.org/10.1080/09644010903063669 Sheehy, B., & Farneti, F. (2021). Corporate social responsibility, sustainability, sustainable development and corporate sustainability: What is the difference, and does it matter? Sustainability (Switzerland), 13(11). https://doi.org/10.3390/su13115965 Spangenberg, J. (2004). Sustainability beyond environmentalism. The missing dimensions. GoSD Working Paper, 2. The Sustainable Development Goals Report 2021. (2021). Tomaškinová, J., Tomaskin, J., Stastna, M., & Theuma, H. (2019). Environmental management challenges in the 21st century: Assessment of protected areas management effectiveness in Slovakia. Journal of Environmental Protection and Ecology, 20(4), 2012–2019. Tomaškinová, J., Tomaškin, J., Theuma, H., Alcántara Valero, A. F., & Attard, V. (2021). Addressing present challenges in the life-cycle of wetlands management to successfully integrate sustainability and good governance. Journal of Environmental Engineering and Landscape Management, 29(1). https://doi.org/10.3846/jeelm.2021.14142 Toumi, O., Le Gallo, J., & Ben Rejeb, J. (2017). Assessment of Latin American sustainability. Renewable and Sustainable Energy Reviews, 78. https://doi.org/10.1016/j. rser.2017.05.013 UN-CSD. (2007). Indicators of sustainable development: guidelines and methodologies. New York, October. UN General Assembly. (2015). Transforming our world: The 2030 agenda for sustainable development United Nations. United Nations. United Nations, & Annan, K. A. (1997). Agenda for development. United Nations Department of Public Information. Valentin, A., & Spangenberg, J. H. (2000). A guide to community sustainability indicators. Environmental Impact Assessment Review, 20(3). https://doi.org/10.1016/ S0195-9255(00)00049-4 Vogt, M., & Weber, C. (2019). Current challenges to the concept of sustainability. Global Sustainability, 2. https://doi.org/10.1017/sus.2019.1 World Commission on Environment and Development. (1987). Our common future. Oxford University Press. DOI: 10.4324/9781003379409-9 7 Sustainable development and corporate social responsibility Ewa Mazur-Wierzbicka and Olgierd Swiatkiewicz Introduction Today’s world is facing many challenges and the main ones include environmental pollution, climate change, limited resources, rising social inequalities or demographic changes. To tackle these challenges, since the 1950s, ideas started emerging and concepts were created. One of them, considered the most popular, was the concept of sustainable development (SD) created in the 1960s, which includes economic, environmental and social issues and takes into account a long-term perspective that places emphasis on raising responsibility for future generations. In the face of these challenges, it is important that we take actions not only on a global scale but also (or perhaps most of all) at the level of individual economic operators because only their pro-social and pro-environmental actions will allow the implementation of the assumptions of the SD concept. Such a possibility is allowed by companies’ implementing the concept of corporate social responsibility (CSR), which may be recognised as a tool for the implementation of SD principles, at the level of an enterprise. Given the above, this chapter intends to show the dependencies and interrelations between the concept of SD (adopting the Brundtland definition as a basis), the triple-bottom-line model and the concept of CSR. Therefore, in the context of the aim presented above, the following questions gain importance: are economic, environmental and social challenges reflected in the CSR concept?; if yes, to what extent?; how does a CSR concept implemented by a company contribute to the implementation of SD goals? It is possible to answer these and other questions thanks to a discussion on the SD concept and CSR from the perspective of a broadly understood business as well as an individual economic operator – an enterprise. The implementation of the main objective dictates the layout of this chapter. The content is based on a critical review of the literature. 92 Ewa Mazur-Wierzbicka and Olgierd Swiatkiewicz Outline of the concept of SD – basis/theoretical introduction The SD concept has had a great impact on how we think about relationships between the economy, society and the natural environment. The beginnings of the later-formulated SD concept may be found in classical economics (D. Ricardo, T. Malthus, J. S. Mill). Representatives of neoclassical economics, Marxism, institutionalism and Keynesian economics also expressed their interest in this subject matter. In the 1950s and 1960s, we realised that excessive exploitation of natural resources, dynamics of growth of the global population, the development of industry and also increased consumption and agricultural production are a threat to the natural environment, and thus for humans as part of it. This contributed to the emergence of the term ecodevelopment, used for the first time at the United Nations conference in Stockholm in 1972; the protection of the natural environment and natural resources comes to the fore in the ecodevelopment concept. The SD concept founded on the notion of ecodevelopment was ultimately accepted and introduced for use by the World Commission on Environment and Development (WCED) and included in the 1987 “Our common future” report (Brundtland Report). SD was defined as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” The Brundtland definition points to two fundamental aspects, that is, the sustained satisfaction of needs across generations and a generational perception of the problem of meeting needs. This means that the essence of SD is to meet the needs of the modern generation in a sustainable manner, thanks to which future generations will be able to use resources in such quantities and of such quality that they will ensure that their social well-being will be no less than that available to the current generation. Since the Brundtland definition was promulgated, many other approaches and angles to the concept of SD have been proposed (Piontek, 2002; Esquer-Peralta et al., 2008), and the majority of them are an expansion or a specification. However, there is a belief that the definition of SD has to include economic, social and environmental dimensions (Byrch et al., 2007; Valezquez et al., 2011) and that it must be an ethical concept. And this is the approach to SD presented by the WCED (1987) (Byrch et al., 2007; Valezquez et al., 2011). Wilkinson et al. (2001) extend this approach claiming that the SD concept should also “include the ethical dimension of the fairness of the trade-off between current economic pressures and future environmental needs”. The multiplicity and diversity of SD definitions make it possible to point out some of its common elements. Therefore, SD is • a type of a socio-economic development that rejects the concept of “zero growth”, • an intergenerational concept, Sustainable development and corporate social responsibility 93 • a concept in which distributive justice and intergenerational justice play a significant role, • a process that integrates all activities undertaken by humankind, • a development that strives to balance the three areas (dimensions): economic, social and environmental, • a concept that points to intangibles – in particular, quality of life. It is essential to focus on the three dimensions of SD which are interdependent and require simultaneous work on all of them (Figure 7.1). All three levels of SD should contribute to achieving a sustainable improvement in the life of humanity (current and future generations) while preserving environmental (natural) and man-made capital. This is possible by taking specific actions and achieving partial goals (Figure 7.2). Depending on which SD goals are undertaken, they are pursued through the declared and conscious action of causative factors or by means of legal or economic instruments applied within the framework of certain policies or development strategies. There might also be situations where the achievement of SD goals, in addition to the assumed positive effects, will bring adverse side effects, which may translate into unsustainable development of certain parts of the specific system under study. Given the three-dimensional nature of SD, the basic difficulty is finding balance and achieving excellence in all dimensions. While economic performance is measurable, the fundamental difficulty is the measurability of social and environmental impacts, especially as they are long-term. How quickly SD is achieved social area environmental area economic area Ethics (the quality of life of current and future generations) legal technological cultural SD societal environmental Figure 7.1 Sustainable development Source: author’s own compilation. 94 Ewa Mazur-Wierzbicka and Olgierd Swiatkiewicz depends on actions taken by individual entities to incorporate SD guidelines and SD targets (including the 17 that are currently defined) in their activities. The concept of SD in an organisation The concept of SD transferred to an enterprise, assumes the equality of its functioning in interdependent areas: economic, environmental and social. A company should, therefore, strive for simultaneous development in these three dimensions. It is possible when economic development supports social progress and respects the right to nature and cares for environmental protection. On the other hand, corporate social policy should enhance economic performance, while environmental protection policy should focus on economic efficiency. Source:adopted (Rogall, 2010). Fundamental goalofsustainabledevelopment Sustainableimprovement of thequality of life of presentand future generations withoutdeteriorating theenvironment andwhile preserving biodiversityand cultural heritage. Partialgoals for economicdimension Stability of thenational economy:ensuring independent existencewith an acceptable qualityof work Satisfying basicneedsby sustainable products (food, housing, clothing, energy), appropriate prices Pricestability and counteractingconcentration and economic power, internationalisationof external costs Non-economicbalance and cooperation for developmentwiththe lowest possible importof rawmaterials An efficientstate budget with sufficientstandards of supplying thepublic with substantive/collective goods andaproper distribution of income Partial goals forsocial dimension Participatorydemocracy andthe ruleoflaw in all aspectsoflife Eradicating poverty;social security;managing demographicproblems Equal opportunities, integration(e.g.,ofgenders or immigrants) External andinternal security,conflict resolution withoutviolence Protection of humanhealth and life Partial goals for environmentaldimension Protectingthe Earth’s atmosphere (reducing global warming) No harm to nature: preserving species and landscapediversity Sustainableuse of renewableresources Sustainableuse of nonrenewableresources Healthy livingconditions (elimination of harmful substances, radiation, and noise) Figure 7.2 Selected goals and actions of individual SD dimensions Source: adopted (Rogall, 2010). Sustainable development and corporate social responsibility 95 Many companies define the maximisation of profit as their main goal. Of course, we must agree that without achieving a profit, a company will not be able to function or grow. Nevertheless, Friedman’s famous saying that the business of business is business becomes incomplete in the coming ecological or social era. Therefore, the operation of a company should be looked at holistically, that is through a prism of not only economic profit – as the realisation of the primary objective of the company (according to the principles of a neoclassical theory of companies), but also relate to the objectives of the natural environment and its protection (environmental objectives) and social objectives (e.g. ensuring adequate quality of life). Company managers are thus forced to examine many entirely new issues that traditional businesses have not had to deal with at all up until now. Company survival forces taking pro-environmental actions. This may be either due to an obligation (e.g. legal requirements, requirements of contractors or society) or due to expected benefits that will enable the company to achieve other objectives. The environmental objectives adopted should be considered from a long-term perspective; however, short-term profit and liquidity are required to achieve them. There is harmony between economic and environmental goals, because implementation of the one side of the coin is often dependent on the other. By introducing rational management of raw and regular materials a company becomes more profitable. However, it is often the case that economic and environmental goals compete with one another in a short-term operation of the company. Costs of environmental protection may be seen as a great burden. In such a situation, to maximise profit, companies postpone outlays on pro-environmental activity. Such behaviour is not ultimately beneficial, because in the long run, a lack of environmental projects may effectively cripple the implementation of any goals at all. Looking to the future, we must consider not only the ‘now’ and financial outlays, but also the benefits related to environmental protection. Implementation of economic and environmental goals allows for the achievement of social objectives where people’s well-being and quality of life present themselves as two of the most important ones. Caring for the quality of life requires that adequate health, landscape, aesthetic and environmental conditions are ensured (clean air, water and soil, biodiversity), yet this is not possible without material guarantees (e.g., labour market or infrastructure) (Adamczyk & Nitkiewicz, 2007). Therefore, transferring the SD concept onto the level of organisations involves a search for such solutions which are socially responsible, environmentally friendly and at the same time economically sound (economically valuable). CRS as an SD tool at the level of a company – principles of the concept The approach to the role of business in society has changed visibly in the age of globalisation, threats and social changes. It is no longer solely a provider 96 Ewa Mazur-Wierzbicka and Olgierd Swiatkiewicz of products or services but it is required to take up various activities directed towards the protection of the natural environment or other pro-social activities (Kaźmierczak, 2017). As a result of this, the term CSR has gained pronounced significance in recent years (see: Lulewicz-Sas, 2014; Yang & Guo, 2014; Zaremba, 2014). A focus solely on financial aspects is no longer sufficient. Social determinants and those associated with environmental protection are also gaining importance. According to B. Rok (2004), three elements influenced the emergence of the CSR idea: • SD, • civic pressure, and • business self-regulation. Increasingly, managers are beginning to notice that only a socially responsible business will be able to strive to enhance the company’s value and to increase its competitiveness. A socially responsible business is one which is based on ethical behaviour and takes into account what is important for the company’s stakeholders – their needs and values. Stakeholders are attributed fundamental importance in the CSR concept. The Stakeholder Theory, created by R.E. Freeman (1984), is one of its pillars. It is mainly on the basis of the stakeholder criterion that the majority of enterprises choose to undertake socially responsible actions (Vos, 2003). Specific choices of organisations show the ranking of individual groups of stakeholders and their sensitivity to specific categories of social problems (Table 7.1). Table 7.1 Most frequently undertaken actions towards selected stakeholder groups Stakeholders Actions Employees Equal treatment, protection of health and safety of work or protection of employee rights Customers Full information about the product, service or technological process, data protection and promotion policy Investors Corporate governance and codes of conduct, assessment of company’s condition, assessment of remuneration for shareholders Suppliers Building lasting relations, transparent contractual terms Financial partners Building relations Authorities Codes of conduct, compliance with the law Communities Charity work, social activities, environmental protection, building virtual communities Natural environment Minimising negative impact on the natural environment, reduction of pollution, rational use of resources and the introduction of pro-environment solutions to production processes and services offered Source: author’s own compilation. Sustainable development and corporate social responsibility 97 The very concept of CSR is difficult to define unambiguously due to the complexity of the subject matter or different perceptions – by those defining it – of the focus, significance or importance of the key issues covered by the concept (Mazur-Wierzbicka, 2012; El Akremi et al., 2018), but also due to its continuous development and a differently perceived scope of corporate responsibility (see more in Dahlsrud, 2008; Freeman & Hasnaoui, 2011; Rok, 2013). In the most general terms, it is assumed that it is the company that is responsible for its impact on society (EC Communication, 2012). It is true that some authors adopt a certain CSR perspective in which they focus strongly on one of the areas, that is the social area, and take the stakeholder theory as a reference point. However, a broader look at CSR, which also takes into account the evolution of the concept and its relations with the concepts mentioned in previous sections of this chapter, allows us to distinguish the most frequently addressed issues. They include • basing activity on legal provisions and ethical norms, • a commitment by the actors to conduct their activities in a transparent and ethical manner, • the long-term nature of the activities undertaken, • taking into account (striking a balance between) economic, social and environmental aspects in the activity, • the voluntary nature of implementation (though this element may currently be under discussion), • directing activities towards a wide group of stakeholders (shaping positive relations with them). Regardless of the differences in defining CSR, the activities that fall within it should be closely linked to the company’s core business to become part of the strategy being pursued. Based on the approach to CSR contained in ISO 26000 and with the purpose of this article in mind, it is assumed that: social responsibility is the responsibility of an organisation for the impacts of its decisions and activities on society and the environment through transparent and ethical behaviour that: contributes to SD, including the health and welfare of society, takes into account the expectations of stakeholders, is in compliance with applicable law and consistent with international norms of behaviour, and is integrated throughout the organisation and practised in its relationships.” (2010). Analysing the definitions of CSR, one can notice the multidimensionality of this concept and the possibility of looking at it from different perspectives. We can, as is the case of the ISO 26000 standard, identify 7 CSR areas or perhaps just two – focusing on the organisation’s external and internal environment (thus we are dealing with external and internal areas), but we can also approach CSR in a somewhat classical way by pointing to three aspects, that is economic, 98 Ewa Mazur-Wierzbicka and Olgierd Swiatkiewicz Table 7.2 CSR areas – examples of activities CSR areas – examples of activities Economic Environmental Social Maximising profit (maximising income on sale and minimising costs: administrative costs, production costs, marketing costs and distribution costs), responsible and safe products and services fair price policy, ethical advertising activity, timely settlement of obligations towards suppliers and business partners, reporting and auditing, socially responsible investment, smart strategic decisions, strong competitive position, sustainability of development, Designing environmentally friendly products and production processes, effective and rational use of resources, improvement of eco-efficiency, reduced production of waste and pollution (discharged to water, air and soil), waste management, recycling, protection of biodiversity, calculation and consideration of environmental risk in the company’s activities, applying the “environmental assessment” of suppliers in the context of their environmental standards, informing business partners, consumers and the public about environmental protection issues Internal stakeholders: improvement of working conditions (in line with occupational safety and health (OSH)) and boosting job satisfaction, work/life balance, equal opportunities and diversity (at each level of human resources management), professional training and development of employees (including career planning), communicating/informing employees and including them in the company’s decisionmaking process, responsible and fair remuneration or financial support for employees, actions based on ethics, values and principles, calculation and consideration of environmental risks in the company’s activities, responsible leadership External stakeholders: programmes supporting society (e.g., education or arts), community involvement, voluntary work, charitable work, improving “quality of life”, Social dialogue, cooperation with local partners building long-term partnerships Measuring one’s own involvement Source: author’s own compilation. Sustainable development and corporate social responsibility 99 environmental and social. These three components: the economic, environmental and social areas, are also directly related to both the SD concept and the TBL – triple bottom line – concept referred to in the previous section of this chapter (Table 7.2). In implementing the concept of social responsibility, it is important that businesses take care of their economic interest (strive to maximise profit), which is in line with the assumptions adopted by A. B. Carroll (1991, 1999). He believed economic responsibility to be the foundation of his pyramid (Figure 7.3). A company generating (long-term) losses has no real possibility of surviving in the market and being competitive. Without generating profit, a company is unable to (in a long-term perspective) ensure employment stability, create socially responsible working conditions for employees, undertake activities for the benefit of the local community or invest in environmental actions. Subsequent types of responsibilities, that is, legal, ethical and philanthropic responsibilities, only come after the economic responsibilities. Legal responsibilities mean that a company must comply with the applicable law at all stages and in all areas of its business. It is above economic responsibilities because each company, striving to maximise their profit, must act within the limits of the law. In this case, the law is a point of reference for managers’ activity. Ethical responsibilities are the next stage. They require that businesses act ethically and with integrity in areas that are not regulated by law. This type of responsibility demonstrates a high degree of awareness and sensitivity on the part of entrepreneurs. Philanthropic responsibilities sit at the top of the pyramid. Through them, companies become civic institutions by contributing resources for the benefit of the community and by supporting it in specific situations that require help (Gołaszewska-Kaczan, 2011). philanthropic responsibilities ethical responsibilities legal responsibilities economic responsibilities Figure 7.3 Caroll’s pyramid of levels of corporate social responsibility Source: adopted (Carroll, 1991). DOI: 10.4324/9781003379409-11 8 Sustainable business management Izabela Stańczyk Introduction Sustainability is perceived as the appropriate ties between productiontechnological and economic development, along with social development, protection of the natural environment, as well as care of future generations (Herman, Oleksyn, Stańczyk, 2016). However, sustainable enterprises may be organisations that respect the principles of sustainable development in their business activities. In accordance with these principles, the functions of planning, organising, motivating, or controlling are significant elements of the organisation, thus the implementation of sustainable management is essential (Pabian, 2011). In this chapter, the contents relating to the definitions of sustainable development shall be presented, while touching on elements of sustainable management. Furthermore, descriptions of business models will be provided, which are based on the sustainable management of organisations in the context of their development and will thus lead to the creation of perspectives for the future (Duraj, 2018) while taking into account such areas as sustainable production, sustainable supply chains, sustainable marketing, sustainable servitisation, sustainable research and development, and sustainable HRM. This chapter will focus attention on a general clarification of sustainable business management. In commencing deliberations with regard to sustainable business management, it is worth drawing attention to the word “sustainability” itself and clarifying it. It is perceived as “leading to a state of equilibrium or ensuring equilibrium between the particular elements” (https://sjp.pwn.pl, 2022). By referring to the sphere of management, we may discuss such activities that ensure a particular organisation has the appropriate balance in terms of financial performance. The achievement of this will depend on a multitude of factors that shape the environs of the organisation. This refers to both the external environs (e.g. legal solutions of business activities of an organisation in a particular area, in a particular country; the global economic situation), as well as the internal environs (e.g. competences of the managerial staff; the philosophy of their activities and the competences of the employed staff). Hence, when viewing sustainable 108 Izabela Stańczyk management, it is necessary to take all these elements into account. Sustainability is perceived as the appropriate ties between production-technological and economic development, along with social development, protection of the natural environment, as well as care of future generations (Herman, Oleksyn, Stańczyk, 2016). Definition of sustainable development In this context, we have started a discussion about sustainable development, which is defined as “a process aimed at satisfying the aspirations of development of the current generation in a manner that facilitates the fulfilment of the same pursuits by the future generations” (Report, 1987). Bearing in mind the long-term ecological strategies, this refers to the implementation of the philosophy of constant development which would integrate the economic and ecological goals with the social goals in the context of a fair chance of sharing the resources for current and future generations (Kuźniarska, 2018). Sustainable development indicates the process of transformation that ensures the fulfilment of needs by the current generation without lowering the opportunities for development of future generations, thanks to, among other things, integrated activities in the sphere of economic growth, social development, and also environmental issues. Such a perception of the issues of sustainable development became widespread thanks to the report by the World Commission of G.H. Brundtland for Environment and Development entitled “Our Common Future”. Sustainable development is also the process of social, economic and environmental change, which would facilitate a balance between the profits and costs of development from the perspective of future generations, namely, “it is the reflection of the policies and strategies of constant economic and social development without damaging the environment and the natural resources, in which the quality depends on continuing human activity and further development” (Johnson, Kwasza, 2022). The genesis of sustainable development can be found in the works of Ł. Kozar, who analyses documents of a worldwide sphere and who indicates the embodiment of the concept of the green economy and sustainable development as a “specific way of management that is appropriate in the context of intensifying environmental problems” (Kozar, 2019). Views of the definition of sustainable development itself have been presented by the following chosen authors (Table 8.1). In the presented definitions of sustainable development, it is possible to indicate the duration of activities in an organisation that encompasses all the solutions that ensure a better quality of life, both in the economic and ecological spheres, as well as in the social sphere. Sustainability is a notion that is relatively new and not entirely analysed in the world of business, and not very well-documented in Poland. W.M. Grudzewski, I.K. Hejduk, A. Sankowska, M. Sustainable business management 109 Wańtuchowicz define sustainability as the ability of enterprises to do the following on a permanent basis: 1 self-learning, 2 adaptation and development, 3 revitalisation, 4 reconstruction, 5 reorientation. Table 8.1 Definitions of sustainable development Author Definition of sustainable development M. Duraj (2018) Sustainable development, which is usually defined as the creation of perspectives for the future. Zuzek, D. K. (2012) Sustainable development is the use and conservation of natural resources, as well as the orientation of technologies and institutions in such a way as to achieve and maintain the fulfilment of current human needs, as well as the needs of future generations. Government of the UK (Renukappa, Egbu, 2012) Likewise, sustainable development was defined by the UK government as “ensuring a better quality of life for everyone right now and for future generations”. Krzysztofek (2013) Sustainable development is a concept that combines economic, ecological and social values. In times of growing competition along with changing customer requirements, in contemporary enterprises, profits are not the only important aspect when it comes to manufacturing or service activities. Managing aspects of sustainable development in business activities are becoming the basis of responsibility in modern business. W. M. Grudzewski, I. K. Hejduk, A. Sankowska, M. Wańtuchowicz (2010) The notion of sustainability is perceived in direct translation as durability. The notion of sustainability is literally understood as permanence. T. Oleksyn (2017) “Activity and development in accordance with the good of all the stakeholders, natural environment and future generations” E. Bombiak (2020) “Sustainable development is a concept that confronts global problems associated with human activities both in developed as well as developing countries”. Brundtland Report: Our Common Future (Matusiak, Matejun, Różańska-Bińczyk, 2020) “Sustainable development is development that satisfies the current needs without threatening the possibilities of satisfying the needs of future generations”. Source: Own analysis based on literature review. 110 Izabela Stańczyk For maintaining a sustainable and distinctive position in the market by offering added value to buyers today and in the future (according to the paradigm of innovative growth), thanks to the limited variability of business models, resulting from the creation of new opportunities and goals, as well as answers to these questions, and comparing the interests of different groups (Grudzewski, Hejduk, Sankowska, Wańtuchowicz, 2010). Within the framework of sustainable development, the concept of the triple bottom line (TBL), which encompasses three dimensions was defined by J. Elkington as follows (2020): – ecological – preserving the environment and its natural resources, – economic – economic development that is not restricted, but stimulated by technological progress and the growth of effectiveness in terms of the use of raw materials, other materials and human labour. – social – enhancement of the standards of living and safety of all people. The principal benefits of the TBL include, among others (Górska-Mytyk, 2022): A healthier working environment that is focused on both the employees, as well as on the position of the organisation in the surrounding social environment (e.g. greater diversity, inclusiveness to reduce employee erosion, action to counter mobbing practices while supporting local communities); – Strategies and actions aimed at achieving a more sustainable future that takes into account both social and environmental sustainability, including moving away from analysing company performance only on a monthly/ quarterly basis (e.g., reduced energy consumption, smaller carbon footprint, circular economy); – New possibilities of generating profit, such as attracting clients who also want to reduce their impact on the environment (e.g. better perception of the brand, greater transparency and possibility of assessing operations, potentially attracting new investors). The sustainable development of a company signifies the voluntary “taking account of social and environmental issues in business activities, as well as in interactions with stakeholders” (Simões, Sebastiani, 2017). “When talking about sustainable development, it is important to keep in mind not only the dynamics of economic growth but also to balance the needs and opportunities to meet them, while balancing the welfare of all stakeholders, business interests/ economy, the environment, as well as present and future generations” (Oleksyn, 2020). According to A. Longoni, M. Pagella, A. Shevchenko, R. Klassen, sustainable development is becoming a significant element in the operating strategy (Longoni, Pagella, Shevchenko, Klassen, 2019). Thus, it has a significant impact on the construction of business models and decision-making at each level Sustainable business management 111 of management. The concept of sustainability is now more widespread both in science and in everyday life and is used by various institutions, as well as being incorporated into numerous programmes and associated with human activities in various places and situations. It is not only the best known and most frequently cited concept linking the environment to development but also the most documented in publications such as, among others, the World Conservation Strategy (IUCN 1980), the Brundtland Report “Our Common Future” (1987), as well as in the outcome documents in Rio de Janeiro in 1992, and at the Earth Summit in Johannesburg in 2002 (Rokicka, Woźniak, 2016). The concept of sustainable development was officially formulated and accepted for implementation in Rio de Janeiro in 1992 (Agenda 21, 2021). However, in 2015, the UN prepared a detailed agenda – the 2030 Agenda for Sustainable Development, which identifies 17 general goals and 169 tasks detailing sustainable development (Przekształcamy nasz świat, 2022). These general aims include the following: no poverty; zero hunger; good health and well-being; quality education; gender equality; clean water and sanitation, affordable and energy; decent work and economic growth; industry, innovation and infrastructure; reduced inequalities; sustainable cities and communities; responsible consumption and production; climate action; life below water; life on land; peace, justice and strong institutions; and partnership for the goals (Ciobotaru, Angheluta, 2014). To achieve the aims of sustainable development in all aforementioned areas, it is essential to have the appropriate human capital and define its development trends from the perspective of medium and long-term trends (Ciobotaru, Angheluta, 2014). This is not an easy task and requires both time and financial outlays. Its creation should be based on the following support systems: a workforce planning system, a recruitment and selection system, a staff training and improvement system, incentive programmes, and effective communication (Kuźniarska, 2018). Sustainable management In the context of the sustainability solutions presented, it is worth defining sustainable organisations/businesses. These are organisations that respect the principles of sustainable development in their business activities, with the proviso that the realisation of the established goals of sustainable development is possible mainly thanks to employees, since most of the issues related to the use of resources, as well as environmental and social issues are resolved at their level. With regard to sustainable development, the functions of planning, organising, motivating or controlling are significant elements of an organisation, hence the necessity to implement sustainable management (Pabian, 2011). A sustainable organisation is one that “achieves goals that ensure its stability and development according to the adopted strategies. At the same time, the methods and tools for achieving strategic goals are accepted by key external and internal stakeholders from the point of view of social justice and environmental safety” (Czaińska, 2020). The philosophy of the so-called Sustainable Business is now playing a 112 Izabela Stańczyk greater role in responsible market competition, which is based on the following 10 key principles that companies should meet (Burchell, 2008): 1 Positive impact of enterprises on the environment; 2 Ensuring a positive perception of trademark and reputation; 3 Implementation of environmental processes that are in compliance with the planned environmental effect; 4 Achievement of appropriate financial performance while taking into account elements of sustainable development; 5 Execution of multi-dimensional programs relating to economic, environmental and social areas; 6 Implementation of efficient and effective strategies of competing based on sustainable business; 7 Responding with clarity to the following question: Can a responsible enterprise operate to function better, or can a well-functioning enterprise be more responsible? 8 Preparing and testing effective business scenarios; 9 Conducting an appropriate division of labour that would ensure growth in the economic sphere, while also raising the ecological awareness of those employed, which may translate to appropriate pro-social behaviour; 10 Searching for and eliminating gaps in the area of the sustainable development of the enterprise on the basis of ratio analysis. In these times of sustainable management, it is worth considering a holistic view of sustainability (that is, the simultaneous consideration of the environmental, social and economic dimensions of sustainability). The elements of the environmental, social and economic dimensions of sustainability have an interdependent nature among themselves. Excessive emphasis on one dimension can have a negative impact on the other two dimensions. Therefore, managers should find intelligent compromises, which is essential if they want to achieve sustainable development. Likewise, it is important to see how these dimensions affect each other (Renukappa, Egbu, 2012). Today’s challenge for decision-makers is to achieve a certain level of comfort in terms of respecting social responsibility, economic viability and environmental sustainability, while protecting the legacy for future generations. Research relating to sustainability can be broadly divided into research related to financial performance or enterprise value and research related to revenue management (Lee, 2011). On this basis, H. Y. Ma and J. Y. Yoo conducted an analysis of research in these areas and indicated the following (Ma, Yoo, 2022): – Financial performance studies show that sustainability positively affects the financial performance and value of companies in various ways; – Companies that conduct business in line with CSR (Corporate Social Responsibility) achieve better sales and financial performance because consumers Sustainable business management 113 interested in social issues prefer the products and services of companies that pay social contributions; – Companies with good ESG (environmental, social, and corporate governance) performance enhance their rating with accounting and market metrics; – Sustainable management reports were additional and supplementary revelations, which had a positive relation with the share prices as they resolved the asymmetry of information and helped investors to take effective decisions. Implementing sustainability in organisations is quite a challenge and involves, among other things (Sartori, Latrônico da Silva, De Souza Campos, 2014): – Implementing environmental protection standards, – Development of the individual, – Promotion of education, – Efficiency in resource allocation, – Publicly available methodologies and indicators for sustainable development, – Use of complementary indicators for evaluation, – Indicators to measure resource use, – Balance between sustainability support systems, – Dynamic indicators of sustainability. The pursuit of sustainability is also a never-ending process of change management, as it is necessary to continuously change the habits, values, awareness and behaviour of employees, consumers, business owners, policy-makers and managers. It is particularly important to change awareness of environmental issues (Matusiak, Matejun, Różanska-Binczyk, 2020). The drivers for an organisation to undertake social and environmental action have been identified and include (Bombiak, 2020) – Changes in stakeholder expectations associated with increasing levels of stakeholder awareness, – Changes in the technological environment that create opportunities to implement innovations in the way organisations operate with regard to the products and services they offer, – Institutional and legislative conditions that define the desired directions and framework for the economy and individual entities, – The search for new sources of competitive advantage. Sustainable management practices help organisations avoid risks and identify opportunities by indicating a sustainability profile (Blackburn, 2022). Research conducted by the Kironi team (Kironi et al., 2022) found that 90% of managers identified sustainability as a key factor in their business operations. However, only 60% of companies have implemented an integrated sustainability system in their organisations. Given these findings, there is a need to 114 Izabela Stańczyk prepare more detailed guidelines to enable companies to take strategic and effective measures for sustainable development (Baumgartner, Rauter2017). Sustainability can also be understood as the appropriate interrelationships between production-technological development and economic development on one side, and social development on another, environmental protection on the third, and concern for future generations on the fourth, whereby such a perception does not arouse objections (Herman, Oleksyn, Stańczyk, 2016). Sustainable management may refer to the values that are preferred in the organisations. It frequently constitutes one of the composite elements of the catalogue of values in enterprises as composite economic-managerial values. Thus, it is one of the principal elements of management in an organisation, building the organisation of work on the basis of economic, ecological and social determinants. With such a catalogue of values, research was conducted within the framework of a project in cooperation between two Polish universities, namely the Warsaw Business School and the Jagiellonian University. In the research conducted, the target group consisted of representatives of private and public sector entities, in particular, senior, middle and lower management managers, as well as specialists from various organisations. Respondents were asked about adherence to sustainability as a value and received the following responses. Sustainability is – a treasured value, which we take more seriously and is already under implementation (30.2%), – a treasured value; however, it is currently under implementation only to a limited extent (62.9%), – a controversial value; I don’t think the concept of sustainability is right for our organisation (4.5%), – other indicators related to individual statements (2.4%). The statements of the respondents are optimistic; they show that the concept of sustainable development (and at the same time this value) enjoys strong support, although twice as many people say that it is being implemented to a limited extent than those expressing the opinion that it is already being implemented fully (Herman, Oleksyn, Stańczyk, 2016). Sustainable management places emphasis on the transparency of management, as well as on ethical management, apart from the traditional management value of creating profit through product quality or marketing strategies. In addition, sustainable management considers contributions to the public interest in social development and environmental protection. Sustainable management means that companies can only survive and grow if they seek cooperation and coexistence with different companies and people (Yu, Jung, 2016). Sustainable management is recognised as a necessary management method for a company to survive as a going concern (Kim, Kim, 2018). Sustainable business management 115 Models of sustainable business management Sustainable development, due to its nature of the impact of human activity on the surrounding environment, has been an inspiration for many strategists for years. Therefore, management in line with the concept of sustainable development involves the development of appropriate business models and also the alignment of competencies of managers at different levels in the organisation as well as in different dimensions, such as project management. Building such a model requires companies to integrate the key strategic factors constituting the business model towards sustainability in the economic, ecological and social areas (Abidin, Pasquire, 2007): – Economicsustainability–requiresenhancingtheprofitabilityoftheenterprisethroughefficientuseoftheresources(humanresources,rawmaterials, finance), efficient projects and undertakings, good management, planning and control, – Ecological sustainability – requires blocking any harmful or irreversible consequencesfortheenvironmentthroughefficientuseofnaturalresources, promoting renewable resources, protecting soil and water, and skilful waste management, – Social sustainability – requires reacting to the needs of society, including all other stakeholders. Anexemplarymodelinthefieldofprojectmanagementisthatofsustainable project management (SPM) and the focus on the role of project managers as a key element. A team from the University of Aveiro presented the following model: Project Management Triple Sustainability Cube (Madureira et al., 2022), which aims to comprehensively and systematically guide project managers in their journey towards sustainability in project management. The model of Triple Sustainability Cube is a conceptual model which illustrates the transversality of the three interrelated dimensions of project sustainability throughout the project life cycle. Itidentifies3×9specificareasofsustainabilityproceduresthatcanbeadopted by project managers in any project development. Having reached a group of 27 practices,eachprojectheadmayobjectivelydefinetheadoptionofeachgroupof the best practices along each axis and at each stage of the project implementation. By emphasising each of the 27 areas of sustainability where action has been taken on a given project, project managers can improve and forecast areas of improvement for current and future projects. The Triple Sustainability Cube Model for project management provides guidance on adopting comprehensive practices for the elements of sustainability (environmental, social, economic) relating to people, processes and innovation during project development. Another example of a model of sustainable business management is that which takes into account the expectations of stakeholders developed by B. Wit. Each 122 Patrycja Zwiech this transition is to be ecologically and socially fair. In March 2020, the sustainable development concept and the circular economy concept became the basis for further documents adopted by the European Union: Environmental Technologies Action Plan [Eco-innovation Action Plan] (European Commission, 2020a), and A New Circular Economy Action Plan for a Cleaner and More Competitive Europe (European Commission, 2020b). A significant paradigm change of the 1990s made us address and analyse the entire product life cycle. Circular economy’s fundamental contribution to sustainable production is its innovative approach to a product life cycle which brings about an increase in material circulation, that is, the relationship between secondary raw materials derived from waste and used materials. The 1990s marked a departure away from the linear model, towards a circular economy in developed countries. This is why environmental protection attained a global dimension and became an important economic factor. The environmental protection perspective extended greatly. Besides, environmental protection began to be perceived not only as an expense that strikes at companies’ competitiveness, but more as an investment. Sustainable production and competitiveness stopped being perceived as contrary, opposing goals. Industry 4.0 too introduced a new look at sustainable production. The central idea of Industry 4.0 is to use emerging technologies so that all industrial processes are integrated, thus making production flexible, efficient and intelligent with high quality and low cost (Machado, et al., 2019). De Sousa et al. (2018) suggest that Industry 4.0 technologies will help the decision-making process concerning sustainable operations management and the development of new business models. Madhado et al. (2019) in turn, claim that the decision-making for sustainable development is aided by methods used for modelling and simulating the activities that occur throughout the product value chain. To sum up, some technologies of Industry 4.0 may help achieve more sustainable production through improvement of the circularity of a product or processes or through trying to reduce resource consumption. Industry 4.0 could be considered as a synergic environment essential to achieve holistic, integrated sustainability in production systems (Ciliberto, et al., 2021). Lean production, however, is an effective method of managing processes and operations, which can also be used in the pursuit of sustainable production. For example, lean tools may be used in the production environment (i.e., 5S, value stream mapping, just-in-time) to make production more sustainable. This is why 5S focuses primarily on labelling and organising material storage and inventory management; it is able to quickly identify spills and dangerous leaks and reduce air pollution (Bae & Kim, 2008; Francis & Thomas, 2020), VSM lean tool is used to understand waste and value in production. Internal effects of lean production that also contribute to the circular economy include brand and reputation enhancement that maintain loyalty to new areas of the market (Geldermann, et al., 2007). Sustainable production 123 Circular economy, Industry 4.0, lean production and sustainable production show a certain degree of complementariness towards one another. The industry, at the moment, is facing a new paradigm which opts out of a one-sided ecological perspective for the benefit of a much stronger focus on the social dimension, which in consequence leads to more sustainable production. The turn of the 20th and 21st centuries was fundamentally modelled by the concept of sustainable development. One of the first definitions of sustainable production, which pointed to aspects that need a particular emphasis, was offered by the Lowell Center (1998). It was defined as “the fabrication of goods and services by applying processes and systems that are non-polluting, save energy and natural resources, are economically viable, safe and healthy for employees and consumers, and socially and creatively beneficial for all working people”. Sustainable production is similarly defined by O’Brien (1999), Veleva & Ellenbecker (2001), Krajnc & Glavic (2003), Hauschild, et al. (2005), Lebel & Lorek (2008) or Wiles & Watts (2014). For example, Veleva and Ellenbecker (2001) claim that sustainable production is defined as the development of products and services by processes and procedures that are pollution free, energy and natural resource efficient, economically viable, secure and safe for workers, communities and consumers, and socially and creatively beneficial to all the stakeholders. The principles of sustainable production encompass the ties between the environmental, social, and economic frameworks within which the development and consumption take place (Machado, et al., 2019). When we look at this definition we see that it accommodates three equal areas: ecology, economy and society. Elkington had already presented such an approach (1994, 1998a, 1998b), where he encouraged companies to reconsider their value creation activities in a multidimensional perspective, that integrates economic aspects with the environmental and social dimensions in an integrated framework called “triple bottom line”. The concept of sustainable production is still evolving, changing the context as new paradigms appear. However, despite universal recognition of having to transition to more sustainable production and to take various relevant initiatives, the global extraction of resources and increasing degradation of social and environmental resources are still growing. Besides, we should bear in mind the choices we make today on building or upgrading production facilities will affect the state of the environment for the next 20–40 years, triggering solutions relating to more or less sustainable production. The investment cycles of objectives last usually between 20 and 40 years, which means that the companies are just one or at least two investment cycles away from half a century (Wyns, et al., 2018). Investment taken up today may either subject humanity or future generations to an unsustainable lifestyle with constantly growing use of natural 124 Patrycja Zwiech resources or encourage the course towards sustainable production from the environmental, economic and social angles. Economic, environmental and social pillars of sustainable production Sustainable production covers three pillars of sustainability: economy, society and environment. Politicians and economists seek a balance between costs and economic, social and environmental benefits using tools such as innovation, regulations and legal incentives (Porter & van der Linde, 1995a, 1995b), partnership under civil law, dissemination of knowledge or creating infrastructure that encourages sustainable production. The economic and environmental pillars were described in the 2003 Kiev Declaration as the need to “delink economic growth from environmental degradation so as to promote both economic growth and environmental protection”. From the environmental point of view, sustainable production refers to a sustainable use of resources (raw materials, land, water, air, soil, landscape and biodiversity) and sources of energy, promotion of climate-neutral economy (reduction of greenhouse gas emissions) and waste reduction. The main aspect of sustainable production is the sustainable use of resources and energy sources. Satisfaction of today’s material needs should not lead to excessive extraction and degradation of these resources. A sustainable use of resources in the long run requires that we take into account their availability, ensuring supply chain security and protection of ecosystems. At the same time, it is important to maintain the environment’s ability to absorb emissions and pollution. Waste reduction is equally important. Waste has a negative impact on the environment by, for example, polluting air, soil or surface and ground waters. Landfills take up large areas, thus changing the landscape, while wrong waste management poses a threat to societies, especially public health. Moreover, the waste generated also means a loss of stocks of raw materials. Waste reduction at the company level forces situations where they will be using more recycled materials and will develop and implement new production processes. Such an activity focuses on a more sustainable acquisition of raw materials, on processing one’s own waste and on correct product design and manufacturing. Companies must also reduce the quantity of waste, reduce the content of dangerous substances in waste and of their permeating the environment and also improve the efficiency of using waste as secondary raw materials. Climate change is another major challenge that pushes us towards sustainable development. Upon adoption and execution of the Kyoto Protocol, extensive efforts were made to reduce the emission of greenhouse gases that are harmful to the environment. Apart from having to introduce a circular process and resource efficiency, we need to decarbonise production. Decarbonisation of heavy Sustainable production 125 industry is a great challenge because decarbonisation of some material and chemical processes, until this day, is an inseparable challenge. Decarbonisation may be implemented in a number of ways, for example, by improving energy efficiency, increasing the use of low-emission electricity, using more recycled materials, modifying existing processes to use, capture, utilise and store carbon dioxide, identifying alternative heat sources for existing processes or through a complete change of fuels (e.g. by direct or indirect electrification, biological raw materials or hydrogen) (Bataille, et al., 2018; Davis, et al., 2018). Therefore, from the environmental point of view a transition to a circular economy, net-zero resource-efficient economy and achievement of net-zerogreenhouse gas emissions are fundamental. To do so, it is vital to retain products, components and materials in the economy for as long as possible and at the same time eliminate waste on the one hand and, on the other hand, the need to use primary resources (McCarthy, et al., 2018). We must be aware that these priorities cause the emergence of other, new priorities – on the one hand, there is a growing use of the planet’s resources, that is, soil, water and raw materials and energy due to growing demand, and, on the other hand, a valid need to reduce them. This results in a growing competition for these resources between the industry (heavy industry in particular), agriculture and the energy sector (OECD, 2017). From an economic point of view, sustainable production refers to the introduction and use of sustainable business practices, smart solutions and artificial intelligence. A greater emphasis on resource efficiency often leads to great savings and thus to better financial results. Actions intended to promote ecological product life cycle through effective resource use, resource-efficient production technologies, innovations and increased consumer awareness as well as the demand for environmentally friendly products turn out to improve competitiveness on the one hand and to improve companies’ financial situation on the other hand. An ecological product life cycle requires sustainable initiatives at all stages of the product life cycle, such as eco-design, eco-labelling, ecomanagement and audit scheme (EMAS) or eco-innovations, which require that producers get involved. Furthermore, an emphasis on sustainable production allows for new business models to be created. For example, today we can see a greater number of companies that offer energy services, which help other companies and public institutions to become more energy efficient. Focussing on sustainable production may turn out not to be a burden, but rather a new business opportunity. Moreover, despite the fact that the literature on the economic returns of sustainable production is already very rich, it still does not lead to any conclusive evidence pertaining to its economic consequences (Antonioli, et al., 2022). It is difficult to deny that circular economy transition for companies will always require costly changes, not only in physical capital (investments) but also in intangibles (R&D activities) and in organisational changes (Antonioli, et al., 2022). 126 Patrycja Zwiech Environmental economics has made great progress in integrating the economic and environmental spheres. At the moment environmental issues are not discussed in the context of costs that limit competitiveness. Economic and environmental goals are not seen as contrary or mutually-exclusive. On the other hand, with regard to sustainable production, advancing sustainability directs fuller attention to the social dimension. When it comes to manufacturing companies, reports on the sustainability of their operations rarely include the social dimension. Many companies produce corporate reports which identify environmental practices and emphasise governance aspects but tend to overlook the role of the employees or workforce (Schneider, 2008). Such an approach is reflected in the literature because studies show that investment in human and social capital may deliver important benefits such as increased productivity, reduced costs, more innovation, higher growth and competitiveness (Schneider, 2008). This lack of proportionality between the pillars (economic and environmental on the one hand and social on the other hand) results not only from a lower interest on the part of the companies themselves but also from difficulties in quantification. In the sustainable production dimension, social aspects include elements that are difficult to measure, such as safeguarding generational and intergenerational justice, supporting the protection of human rights within the company’s sphere of influence and promoting honesty, integrity and fairness in all aspects of doing business, safeguarding gender equality, ensuring decent workplaces, promoting positive employee treatment and contributing to employee health, safety, dignity and satisfaction, a better quality of life, respect for collective bargaining and interaction with local communities. What is more, the social dimension is the most difficult to integrate. A combination of the economic and environmental pillars from the point of view of companies was much easier than incorporating social goals to the sustainability process. However, only an extension of the economy and the environment as components of the analysis of eco-innovation to include social aspects will allow for a full understanding and the introduction of sustainable production. We must realise that sustainable production brings both improvement and problems in social questions. For example, the introduction of an energy transformation will mainly affect less economically-developed areas, which is addressed in the 2015 International Labour Organization (ILO) guidelines on just transition (ILO, 2015). Low-income areas and scarcely populated rural areas will be most vulnerable to job losses as a result of automation and transition to low-emission economy (Oxford Economics, 2019). Therefore, we will need to provide support to those made redundant in the poorest countries to prevent poverty, aggravated social inequality or problems associated with economic migration. Despite the problems that accompany attempts to make production sustainable, the angle adopted is indispensable, necessary and right. Lauritzen (2008) identifies a few reasons why humanity must head in this direction, as we have no other solutions at hand. The first of them is the global population growth, which Sustainable production 127 will entail growth of consumption. The next is the growth of income per capita around the world. Growing incomes (which is naturally a good thing) will entail further growth of consumption, use of energy or other resources and greater use of the natural environment. A growing demand will also lead to higher prices and will thus boost attractiveness of the development of energy-efficient and resource-efficient ways to produce goods and services. Thirdly, growing consumer awareness presents new challenges for companies regarding not only the quality and price but also, increasingly, sustainable products. Principles of sustainable production In the light of the aspects and problems described above, we may find the principles of sustainable production useful, which pave the way for companies or help establish how they must adjust their production systems to be in line with principles of sustainable production and how to identify strategies helpful in a transition to sustainable production. Veleva and Ellenbecker presented such Principles of Sustainable Production at the beginning of the 21st century. They point out that: • Products and packaging are designed to be safe and ecologically sound throughout their life cycles; services are designed to be safe and ecologically sound. • Wastes and ecologically incompatible by-products are continuously reduced, eliminated or recycled. • Energy and materials are conserved, and the forms of energy and materials used are most appropriate for the desired ends. • Chemical substances, physical agents, technologies, and work practices that present hazards to human health or the environment are continuously reduced or eliminated. • Workplaces are designed to minimise or eliminate physical, chemical, biological, and ergonomic hazards. • Management is committed to an open, participatory process of continuous evaluation and improvement, focused on the long-term economic performance of the firm. • Work is organised to conserve and enhance the efficiency and creativity of employees. • The security and well-being of all employees are a priority, as is the continuous development of their talents and capacities. • The communities around workplaces are respected and enhanced economically, socially, culturally and physically; equity and fairness are promoted. (Veleva & Ellenbecker, 2001) Nevertheless, these principles concerned a linear economy and did not take into consideration principles of circular economy or solutions proposed in Industry 128 Patrycja Zwiech 4.0 or lean production schemes. In 2021, Viles et al. proposed rules that also refer to the concept of circular economy and Industry 4.0. They identify the following: • Design for circularity. Design processes, products, and packing to consume minimum natural resources and energy to sustain the ecosystem’s regenerative capacities. Follow design for disassembly to allow – if possible – for recycling, repairing, reconditioning, refurbishing or remanufacturing. • Conserve resources and preserve their value. Use natural resources and energy that are appropriate for the desired sustainable goals. Preserve the value of resources for as long as possible within production facilities (internal recirculation) and consider the concept of industrial symbiosis to circulate resources (external recirculation). • Manage waste sustainably. Emphasise waste-prevention activities by reintroducing resources within the intended flow. For resources that reach the waste management stage, use the waste management hierarchy following these strategies: reduce waste, then reuse and recycle, minimising all disposal routes, including landfilling and waste to energy. • Pursue a risk-free environment. Reduce or eliminate chemical substances, physical agents, and technologies that present a risk to the environment. Reduce greenhouse gases emissions to reach net-zero emissions. • Prioritise employees’ well-being. Embed employee safety and well-being in the day-to-day work. Choose practices and workplaces that preserve the physical, functional, and psychological comfort of employees. • Enhance management’s commitment to sustainability. Establish an organisational culture enabling high sustainability performance. Empower employees and develop their talents. Promote diversity, equity and inclusion in the workplace. • Make a positive contribution to the community. Contribute to better economic, environmental, social, cultural, and physical outcomes of the communities in which the company operates and in those where its decisions can have an impact. • Promote value chain stakeholder collaboration. Establish fluid communication and collaboration with all the stakeholders of the value chain to make processes and products more sustainable. • Measure and optimise sustainable processes. Define a set of “Key Performance Indicators” to optimise production processes. Monitor short-term and long-term sustainability performance of the production system by encouraging digitalisation. • Boost the use of sustainable technologies. Improve existing technologies with more sustainable alternatives, and provide information on both the potential benefits and risks of sustainable production. Consider the best Sustainable production 129 available techniques; these techniques involve both the technology used and the design, construction, maintenance, and operation of the installation. (Viles, et al., 2022) Summary Sustainable development, as Goal 12 of the 2030 Agenda for Sustainable Development, was formulated as follows: ensuring sustainable consumption and production patterns – it requires a systematic approach and cooperation of entities that participate in the entire supply chain. Achievement of the sustainable production goal is constantly guided through global, regional and national policies, which encourage a transition to a circular economy with a more effective use of resources and lesser pollution. The first part of this chapter describes how the concept of sustainable development came about and what the links between sustainable production and circular economy are, Industry 4.0 and lean production. The second part identifies three dimensions of sustainable production: the environmental, economic and social realms. In the last part principles of sustainable production are presented. Sustainable production may be considered a complex strategy that achieves success only through the involvement of the entire supply chain. In this sense, in order to promote sustainability, there is a need for a strong ability to identify and pursue common and mutual benefits for producers, suppliers, and customers in an integrated and holistic way (Ciliberto, et al., 2021). This chapter refers to sustainable production and is related to producers’ actions, but we must be aware that the consumer is an equally important element in this process. This process envisages educational or other projects for consumers which are intended to raise their awareness about sustainable production and the related lifestyle by, for example, carrying out information actions on product standards and labelling or consumer involvement in public procurement. References Acerbi, F., & Taisch, M. (2020). A literature review on circular economy adoption in the manufacturing sector. Journal of Cleaner Production, 273. https://doi.org/10.1016/j. jclepro.2020.123086 Antonioli, D., Ghisetti, C., Mazzanti, M., & Nicolli, F. (2022). Sustainable production: The economic returns of circular economy practices. Business Strategy and The Environment, 31, 2603–2617. https://doi.org/10.1002/bse.3046. Bae, J. W., & Kim, Y. W. (2008). Sustainable value on construction projects and lean construction. Journal of Green Building, 3(1), 156–167. https://doi.org/10.3992/jgb.3.1.156. Bataille, C., Åhman, M., Neuhoff, K., Nilsson, L. J., Fischedick, M., Lechtenböhmer, S., Solano-Rodriquez, B., Denis-Ryan, A., Stiebert, S., Waisman, H., Sartor, O., & Rahbar, S. A. (2018). A review of technology and policy deep decarbonization pathway 130 Patrycja Zwiech options for making energy-intensive industry production consistent with the Paris Agreement. Journal of Cleaner Production, 187, 960–973. https://doi.org/10.1016/J. JCLEPRO.2018.03.107. Betancourt Morales, C. M., & Zartha Sossa, J. W. (2020). Circular economy in Latin America: A systematic literature review. Business Strategy and the Environment, 29(6), 2479–2497. https://doi.org/10.1002/bse.2515. Ciliberto, C., Szopik-Depczyńska, K., Tarczyńnska-Łuniewska, M., Ruggieri, A., & Ioppolo, G. (2021). Enabling the circular economy transition: A sustainable lean manufacturing recipe for Industry 4.0. Business Strategy and the Environment, 30(7), 3255–3272. https://doi.org/10.1002/bse.2801. Davis, S. et al. (2018). Net-zero emissions energy systems. Science, 360(6396). http://doi. org/10.1126/science.aas9793. de Sousa Jabbour, A. B. L., Jabbour, C. J. C., Godinho Filho, M., & Roubaud, D. (2018). Industry 4.0 and the circular economy: A proposed research agenda and original roadmap for sustainable operations. Annals of Operations Research, 270(1), 273–286. https://doi.org/10.1007/s10479-018-2772-8. Elkington, J. (1994). Towards the sustainable corporation: Win-win-win business strategies for sustainable development. California Management Review, 36, 90–100. https:// doi.org/10.2307/41165746. Elkington, J. (1998a). Accounting for the triple bottom line. Measuring Business Excellence, 2(3), 18–22. https://doi.org/10.1108/eb025539. Elkington, J. (1998b). Partnerships from cannibals with forks: The triple bottom line of 21st-century business. Environmental Quality Management, 8(1), 37–51. https://doi. org/10.1002/tqem.3310080106. European Commission. (2019). Report From The Commission To The European Parliament, The Council, The European Economic And Social Committee And The Committee Of The Regions On The Implementation Of The Circular Economy Action Plan. European Commission. European Commission. (2020a). Environmental Technologies Action Plan [Ecoinnovation Action Plan]. European Commission. European Commission. (2020b). A New Circular Economy Action Plan for a Cleaner and More Competitive Europe. European Commission. Francis, A., & Thomas, A. (2020). Exploring the relationship between lean construction and environmental sustainability: A review of existing literature to decipher broader dimensions. Journal of Cleaner Production, 252, 119913. https://doi.org/10.1016/j. jclepro.2019.119913. Geldermann, J., Treitz, M., & Rentz, O. (2007). Towards sustainable production networks. International Journal of Production Research, 45, 4207–4224. https://doi. org/10.1080/00207540701440014. Hauschild, M., Jeswiet, J., & Alting, L. (2005). From life cycle assessment to sustainable production: Status and perspectives. CIRP Annals, 54 (2), 1–21. https://doi. org/10.1016/S0007-8506(07)60017-1. ILO. (2015). Guidelines for a just transition towards environmentally sustainable economies and societies for all. https://www.ilo.org/wcmsp5/groups/public/---ed_emp/--- emp_ent/documents/publication/wcms_432859.pdf. Sustainable production 131 Joshi, K., Venkatachalam, A., & Jawahir, I. S. (2006). A new methodology for transforming 3R concept into 6R concept for improved product sustainability. In Proceedings of the IV Global Conference on Sustainable Product Development and Life Cycle Engineering, Sao Paulo, Brazil, 3–6. Khaw-ngern, K., Peuchthonglang, P., Klomkul, L., & Khaw-ngern, Ch. (2021). The 9Rs strategies for the circular economy 3.0. Psychology and Education, 58(1), 1440– 1446. https://pdfs.semanticscholar.org/8e5c/34b5865c21a0544158cf5235a9bbb313 19c6.pdf Krajnc, D., & Glavicˇ, P. (2003). Indicators of sustainable production. Clean Technologies and Environmental Policy, 5, 279–288. https://doi.org/10.1007/s10098-003-0221-z. Lauritzen, F. (2008). Sustainable production as industrial policy. In OECD Sustainable Development Studies Measuring Sustainable Production. OECD Publishing, 19–22. ISBN 978-92-64-04412-8. Lebel, L., & Lorek, S. (2008). Enabling sustainable production-consumption systems. Annual Review of Environment and Resources, 33, 241–275. https://doi.org/10.1146/ ANNUREV.ENVIRON.33.022007.145734. Lowell Center. (1998). Lowell Center for Sustainable Production. Sustainable Production: A Working Definition. Informal Meeting of the Committee Members. McCarthy, A., Dellink, R., & Bibas, R. (2018). The macroeconomics of the circular economy transition: A critical review of modelling approaches. OECD Environment Working Papers, No. 130, OCD Publishing. https://doi.org/10.1787/af983f9a-en. Machado, C. G., Winroth, M. P., & Ribeiro da Silva, E. H. D. (2019). Sustainable manufacturing in Industry 4.0: An emerging research agenda. International Journal of Production Research, 1–23. https://doi.org/10.1080/00207543.2019.1652777 O’Brien, Ch. (1999). Sustainable production – a new paradigm for a new millennium. International Journal of Production Economics, 60(1), 1–7. OECD. (2017). The Land-Water-Energy Nexus: Biophysical and Economic Consequences. OECD Publishing. https://doi.org/10.1787/9789264279360-en. Oxford Economics. (2019). How Robots Change the World: What Automation Really Means for Jobs and Productivity. Oxford Economics. http://resources.oxfordeconomics.com/how-robotschange-the-world. Porter, M. E., & van der Linde, C. (1995a). Green and competitive: Ending the Stalemate. Harvard Business Review Reprint, 73, 120–134. http://kentlundgren.se/artiklar/vetenskapliga/Porter_Linde_1995.pdf Porter, M., & van der Linde, C. (1995b). Toward a new conception of the environment – competitiveness relationship. Journal of Economic Perspectives, 9(4), 97–118. https:// doi.org/10.1257/jep.9.4.97. Potting, J., Hekkert, M., Worrell, E., & Hanemaaijer, A. (2017). Circular Economy: Measuring Innovation in the Product Chain. Policy Report. PBL Netherlands Environmental Assessment Agency. Schneider, R. (2008). Measuring social dimensions of sustainable production. In OECD Sustainable Development Studies Measuring Sustainable Production. OECD Publishing, 39–47. ISBN 978-92-64-04412-8. Stahel, W. R., & MacArthur, E. (2019). The Circular Economy. A User’s Guide. Routledge. https://doi.org/10.4324/9780429259203 234 Jerzy Rosiński Laloux, F., Pracować inaczej, Wydawnictwo Studio EMKA, Warszawa, 2015a. Laloux, F., The future of management is teal, strategy+business digital, Autumn 2015b, Columbia Business School, digital version at: https://www.strategy-business.com/ article/00344?gko=10921, access: 02.03.2018. Laloux, F., Reinventing organizations: An illustrated invitation to join the conversation on next-stage organizations. Nelson Parker, Millis MA, 2016. Milkman, M. How to change. Penguin Books, London, 2022. Rosiński, J., Creating an evolutionary teal organization on a step-by-step basis: a case study, Przedsiębiorczość i Zarządzanie, 2018 vol. 19, Emerging challenges in modern management no. 6, cz. 1, pp. 243–256. Rosinski, J., Beyond excellence in the automotive industry in industry 4.0?: lessons learned from the creative business sector, in: Voigt, K.-I., Müller J. M. (eds.) Digital business models in industrial ecosystems: Lessons learned from industry 4.0 across Europe, Springer, Cham 2021, pp. 217–234. Sztumski, J., Wstęp do metod i technik badań społecznych, 6th ed., Śląsk Wydawnictwo Naukowe, Katowice, 2005. DOI: 10.4324/9781003379409-21 17 The role of innovation in sustainable development Magdalena M. Stuss Introduction The issue of sustainable development, as indicated by numerous scientific studies (see: previous chapters) have become important for the stakeholders of organisations, also in areas of the economy where the need for innovation is indicated as a key determinant (Damanpour & Schneider, 2006; Varadarajan, 2017; AlBaghdadi et al., 2021). So far, only some previous studies on sustainability have looked at the relevant relationship between sustainability and innovation (Qi et al., 2010; Boons & Lüdeke-Freund, 2013). Sustainability factors such as reducing the carbon footprint, poverty alleviation, fair distribution, waste reduction and transparency and related business strategies – understood as clean technology, vision of sustainability, pollution prevention and product management – can accelerate the creation of sustainable value for companies by implementing innovations (Evans et al., 2017). A historical contribution to the building of the concept of innovativeness was made by J. Schumpeter, whose work was devoted to clarifying and emphasising the role of innovation and entrepreneurship. J. Schumpeter pointed to five cases of innovation as follows (Schumpeter, 1960): • The implementation of new products that consumers had not been familiar with prior to this, or a new type of product. • The introduction of a new production method, which has not yet been practically tested in a given industry. • The opening of a new market, i.e. a market where a certain type of industry in a given country had not previously entered, regardless of whether this market existed before or not. • The acquisition of a new source of raw materials or semi-finished products, regardless of whether the source already existed or whether it had to be created. • Conducting a new organisation of some industry, e.g., creating or breaking a monopoly. 236 Magdalena M. Stuss Innovation, according to J. Schumpeter, signifies the implementation of new solutions into practice, while the subject of his considerations was primarily technical innovations, as well as their impact on the economy. Any dissemination of innovations constitutes a separate type of change, referred to imitation (Makieła & Stuss, 2018, p. 29). In the contemporary perception of the notion of “innovativeness”, there is the ability to implement new solutions (new products, new types of activities, new technologies, new entities and institutions, new forms of organisation and management) in all spheres of social and economic life. Innovation is the process of transforming existing capabilities into new ideas and introducing them into practical application (Makieła & Stuss, 2018, pp. 28–32). A different approach to the problematic issue of innovations was presented in the Oslo Manual, in which innovation is assumed to be the implementation of a new or significantly improved product (goods or services) or a process, a new marketing method, or a new organisational method in economic practice, workplace organisation or relations with the environment. Such a general definition of innovations is justified by the fact that it covers a wide range of possible innovations (Podręcznik Oslo. Zasady Gromadzenia i Interpretacji Danych Dotyczących Innowacji, 2008). It should be mentioned that the scope of the notion of “innovation” changes in subsequent editions of the manual and the current assumption is that the minimum requirement for the existence of innovation is for the product, process, marketing method or organisational method is new (or significantly improved) for the company. This includes products, processes and methods which a particular company was the first to create, and also those that were adopted from other companies or entities (Oslo Manual 2018, 2018). S.D. Anthony describes the evolution of innovation as a transition of the subject of innovation from the individual innovator to enterprises, and the transition of the object of innovation from technological innovation to an innovative business model (BM) (Anthony, 2012). The common feature of innovations is the fact that they were implemented and launched to the market. New processes, marketing methods, or organisational methods are implemented when their actual use in the company’s operations begins. This signifies that innovative activity is the entirety of scientific, technical, organisational, financial and commercial activities that lead to the implementation of innovations. Innovative activity also includes research and development (R&D) activities, which are not directly associated with the creation of a specific innovation (Makieła & Stuss, 2018, p. 32). Innovativeness in BMs may be found in a new business activity, a new combination of activities (structure), or a change in the entity conducting a given activity. Novelty as a measure of the innovativeness of a system of activities may be expressed by means of the new transaction structure, transaction content, or new participants or customer constraints and the creation of exit barriers related to a change of supplier (loyalty program, dominant design, trust, customisation), The role of innovation in sustainable development 237 as well as network externalities, complementary goods that increase the value of the product and the dependency between components, particularly the effect of synergy and the economies of scale (Loučanová et al., 2022). The ability to innovate in the field of sustainable development represents a necessary business acumen, regardless of whether it is associated with small and incremental steps, or radical innovations (Evans et al., 2017). Innovation is emerging as a potential mechanism for integrating sustainability into business (Schaltegger et al., 2012; Schaltegger & Wagner, 2011). However, there is a lack of clarity, conceptual consensus and consistency in the use of these terms: BM, BM Innovation (BMI) and Sustainable BM (SBM) (Magretta, 2002; Osterwalder & Pigneur, 2010; Boons & Lüdeke-Freund, 2013). This chapter aims to organise the aforementioned concepts and attempt to characterise, classify and define their boundaries. Business model innovation Sustainable innovativeness has for some time been acknowledged to be a key determinant of business and societal change, as well as the answer to the increasing complexity of the environment in which businesses operate. Despite considerable interest in the drivers of sustainable innovation at the level of enterprises, there is little knowledge about the role of sustainable activities in the innovative models and the performance of innovation-focused enterprises (Al-Baghdadi et al., 2021). A. Osterwalder and Y. Pigneur described the BM as the fundamental principle of creating, maintaining and exchanging value – the BM should be dynamic due to the constantly changing environment (Osterwalder & Pigneur, 2010). BMI was initially defined as the process of discovering fundamentally new BMs in an existing business (Markides, 2006), thereby modifying or modernising the existing business logic of how value is created and captured (Foss & Saebi, 2017). Nevertheless, the most frequently quoted definition of the BMI by N. Bocken et al., states that “changes in the way the organisation and its value-network create, deliver value and capture value /…/ or change their value propositions”. Such a statement moves value towards the focal point of interest as the crucial element, which not only constitutes the innovativeness of a BM but will also determine a company’s performance and profit (Mielcarek & Piekarczyk, 2022). BMI deals with a new way to do business aimed at prosperity in a dynamic environment through the reconceptualisation of the underlying logic behind the value creation, capture and delivery (Richardson, 2008; Teece, 2010). The phenomenon of BMI, due to the development and utilisation of new technology, is more relevant and complex than ever before (Mielcarek & Piekarczyk, 2022). Firms increasingly need to innovate by modifying their BM by initiating changes, improvements and replacements in various organisational elements (Mitchell & Coles, 2003). 238 Magdalena M. Stuss Furthermore, scholars have used BMI as a strategic tool or unit of analysis to study how firms can overcome the competitive threat of a specific industry, such as the creative and cultural industry (i.e., Lantano, Petruzzelli, & Panniello, 2022) or the tourism and hospitality industry (Presenza et al., 2019). BMI should be the result of modernising the BM (in which the current BM is progressively improved) or the result of generating and designing a BM (where no BM previously existed) (Berends et al., 2016). Although each path is very different in terms of its challenges, both paths require entrepreneurs to understand and decide how the organisation’s current system of operations needs to be changed and how this contributes to the creation and acquisition of value (Amit & Zott, 2020). According to C. Christensen, companies can achieve BMI by adopting a technology push and incorporating a technological breakthrough which, in effect, would make them the first movers in the industry (Christensen, 1997). However, some research projects show that BMI is not always beneficial (Halecker et al., 2014). It is relevant to understand these elements to facilitate the analysis of organisational processes and planning of transformation from one BM to another and to increase the firm’s resilience and the probability of success (Geissdoerfer et al., 2018). Sosna et al. identify two generic phases organisations go through to innovate their BMs: exploration and exploitation. In the exploration phase, the organisation aims to understand what BM design would address the strategic challenges (such as changing customer demands, increased competition, or emergent technologies) through a trial-and-error process. In the exploitation phase, the BM is implemented, its performance is measured, and if proven to be valuable, it is scaled (Sosna et al., 2010). Frankenberger et al. propose a finer-grained iterative BMI process with four phases (Frankenberger et al., 2013): • initiation – which involves analysing and understanding the ecosystem’s needs and identifying important stakeholders, • ideation – which concerns generating potential new (draft) BM designs, • integration – which aims to establish a viable and complete BM design, concretising its structure, business logic, and resources needed, • implementation – which ensures that the selected BM design can be put into practice and is supported through its organisational processes. However, the most famous one is the classification provided by M. Geissdoerfer et al. which identifies four types of BMI – start-up, transformation, diversification and acquisition (Geissdoerfer et al., 2018), and also by S. Cavalcante, P. Kesting and J. Ulhøi which describes creation, extension, revision and termination (Cavalcante et al., 2011). An important issue as regards the use of resources in BMI is the scope of new technologies. BMI requires time, partly due to the fact that the preparation of a The role of innovation in sustainable development 239 BM is more dependent on the context rather than the management of technology (Teece, 2010). The adaptation of new technologies offers an opportunity for BM renewal, but a profound change in the BM also disrupts previous configurations of resources and can diminish a company’s performance (Sosna et al., 2010; Mielcarek & Piekarczyk, 2022). Sustainable business model innovation In recent years, a new form of BMI has emerged by incorporating the sustainability concept into the firm’s goals and processes. We define sustainable business model innovation (SBMI) as a change in how a firm operates to create a positive impact or reduce the negative consequences for the environment and society (Ferlito & Faraci, 2022). The evolution of the approach to SBMI is presented in Figure 17.1. SBMI builds on the traditional BMI but applies it to a more expanded context. The basic idea is first to test the company’s current BM for sustainability against a broader temporal, societal, and spatial context so that its vulnerability to externalities, its sustainability limits, and its potential to create new environmental and societal value all become apparent. Secondly, it explores BMIs by applying a combination of modular “transformations” to address limits and leverage potentials. Subsequently, it connects BMIs back to the core drivers of business advantage and financial performance to assess how they can deliver both value and sustainability. New models are piloted and tuned to seize an advantage in the market, and also with investors and stakeholders, as well as to understand what changes are needed in the business ecosystem or at the industry level to create the right context for success (Young & Reeves, 2020). Corporate social responsibility INNOVATION Business Model Business Model Innovation Process improvements to achieve compliance Reactive changes for sustainability. Stepwise business model changes to meet market and investor pressures Environmental, Social and Governance Business model changes to meet market and investor pressures. Innovation of business models and ecosystem to cooptimize for business and societal Sustainable Business Model Innovation Figure 17.1 The evolution of the approach to SBMI Source: Own analysis based on literature research included in the references 240 Magdalena M. Stuss SBMI involves changes in how a company does business to address societal and environmental challenges and has gained increasing attention in the last two decades as a means of sustainable development. To reach its sustainability potential, SBMI necessitates engagement with external stakeholders to develop multi-stakeholder value propositions and value capture mechanisms, making these external stakeholders fundamentally part of a (future) functioning BM. SBMI therefore structurally transcends the organisational boundaries of the firm and requires a redesign and re-alignment of the organisational boundaries of the respective organisations involved (Velter et al., 2021). On the other hand, N. Bocken et al. define SBMI as “innovations that create significant positive and/or significantly reduce negative impact on the environment and/or society, through changes in the way the organisation and its value network creates, delivers and captures value (i.e. create economic value), or change their value proposition” (Bocken et al., 2014). They propose a categorisation of SBM archetypes, according to the main type of BMI: technological, social and organisation-oriented innovation, according to the nature of the dominant innovation. Firms can select one or more archetypes in developing their SBMs, and at the same time also combine different archetypes (Tiscini et al., 2020). The SBMI considers the value creation in the activities carried out and their delivery as eco-social benefits balanced among all the players. In other words, it may include changing energy inputs in the industry using renewable energies, such as the sun and the wind, or modifying the way products reach the market in terms of transportation (Ferlito & Faraci, 2022). SBMI is characterised by the following (Young & Reeves, 2020): • the incorporation of sustainable principles or goals into the existing value proposition, • the extension of the value creation concept from economic value to shared value (Porter & Kramer, 2011), • the consideration of non-financial interests in the decision-making process, • managers who act as sustainability leaders to promote a new mindset within the whole organisation (Stubbs & Cocklin, 2008). As opposed to M. Velter et al., SBMI frames boundary work as the activity of exploring, negotiating, and re-aligning organisational boundaries around new value propositions (Velter et al., 2021). Type of SBMI Model of R. Ferlito and R. Faraci Based on the new framework for an SBMI process, they proposed a multidimensional vision of SBMI. The framework suggests starting the analysis from the value proposition section that is made up not only by describing new sustainable The role of innovation in sustainable development 241 value, such as existing tools but also by explaining the governance. This is followed by the value creation and delivery system related to resources, assets, processes and position in the value network relative to customers, competitors, collaborators and all stakeholders. Following the framework’s logic, we must consider how the value is created and distributed. The final area of our framework focuses mainly on the firm’s results and their measurement. The second step concerns transparency, which is often associated with the amount of information an organisation is willing to disclose. Transparency cannot exist without ethical action such as the presence of an ethical code and an ethical audit. The last element necessary to consider is governance since leading the transformation to a more SBM must be a constant topic on the Board of Directors’ agenda (Ferlito & Faraci, 2022). Model of D. Young and M. Gerard The core practice for SBMI is an iterative innovation cycle. With each round, the company gains scale, experience, and market presence for its initiative; these reinforce both the business advantage and the environmental and societal benefits generated (Young & Gerard, 2021): • Step 1. Expand the Business Canvas – develop a rich understanding of the broader stakeholder ecosystem in which the company operates and of the environmental and societal issues and trends that might affect this ecosystem. As part of this diagnosis, it is necessary to explore the potential impact of ecosystem dynamics and other issues on the BM. This will facilitate the identification of a range of business vulnerabilities and opportunities tied to environmental and societal issues. • Step 2. Innovate for a Resilient BM – transform the BM, or imagine an entirely new one, so that you can seize these opportunities. In this second step, it is necessary to innovate and develop new aspects of that new BM. It should ideate a new BM to integrate and reinforce both business advantage and environmental and societal benefits. • Step 3. Link to Drivers of Value and Competitive Advantage – test, iterate, and refine the BM ideas or concepts (from the second step) to ensure that they will yield the environmental and societal benefits intended, and that the benefits will translate into value and advantage for the company. A business with weak profit margins cannot invest in innovation to amplify and scale environmental and societal benefits. • Step 4. Scale the Initiative – the full potential value of SBMI is achieved only when the new BM is brought to scale: engaging people in the company, across the supply chain, in the company’s networks, and in its ecosystems to expand impact and advantage. 242 Magdalena M. Stuss Model of D. Young and M. Reeves Strategy and sustainability are jointly considered and become mutually reinforcing, in which reporting gives way to action, and a company-centric approach gives way to a multilevel approach and new models of competition and sustainable value creation. The idea builds on M. Porter’s concept of shared value, but it unites sustainability and strategy efforts in a common methodology and process, both at the enterprise level and at higher levels (Young & Reeves, 2020). A model as a cycle which enables resilience, durability, and value creation through changing business, societal, and investor contexts has the following characteristics (Young & Reeves, 2020): • It scales effectively without diminishing returns or increasing the risk of failure. • It increases differentiation and competitiveness. • It reduces the potential for commoditisation. • It creates an environmental and societal surplus. • It remains durable against emerging socio-environmental trends. • It exhibits network effects that accumulate value and reshape value chains. • It harnesses or reshapes business ecosystems for advantage and sustainability. • It increases returns to shareholders and net positives to stakeholders in the environmental and societal dimensions. • It stimulates the purpose of the company in ways that propel engagement and affinity for employees, customers, investors, and other stakeholders. Model of E. Al-Baghdadi et al. BMI has a direct relationship with sustainable innovations orientation (SIO) and management accounting control systems (MACS), as well as the fact that MACS have a direct relationship with SIO. In addition, company and industry-related factors were proposed as the sustainable innovation orientation drivers, while sustainable product and process innovation and some measures of corporate performance were proposed as the outcomes of a sustainable innovation orientation. The mediating role of MACS and SIO in the relationship between BMI and sustainable innovation outcomes (corporate performance) was also hypothesised and it was contended that the innovation of a BM by manufacturing companies can lead to a sustainable outcome. The MACS and sustainable innovation orientation were found to mediate the relationship between BM sustainability and environmental performance, and also the relationship between BM sustainability and employee performance (Al-Baghdadi et al., 2021). Summary – implementation Like any type of innovation, BMI is a way of changing and expanding the ability of businesses to operate more effectively and efficiently. By focusing on proposing and creating value, BMI has become a major tool for developing new and The role of innovation in sustainable development 243 changing existing forms of organisational value creation. The emerging field of research and practice in the area of SBMs has adopted this approach to understand and develop new forms of value creation that offer novel value propositions to customers and all other stakeholders, and that enable companies to maintain the value of expected financial performance, while maintaining and even regenerating social and natural capital. The implementation process should start by thinking over the concept of S. Anthony, who described the evolution of innovation as the transition of the entity of innovation from the individual innovator to enterprises and the transition of the object of innovation from technological innovation to BMI (Anthony, 2012). To further draw on the research of F. Lüdeke-Freund, they found the case of an SBMI of 45 patterns with the potential to create ecological, social, and economic value. These were arranged in 11 pattern groups (Lüdeke-Freund & Froese, 2020): “Pricing & revenue”, “Financing”, “Eco-design”, “Closing-theloop”, “Supply chain”, “Giving”, “Access provision”, “Social mission”, “Service & performance”, “Cooperative”, “Community platform”. SBMI should be implemented by translating sustainability strategies into practical action plans for value-creating enterprises. In doing so, SBMI improves a company’s ability to create, maintain or recreate natural, social and economic capital across organisational boundaries. This is realised by changing the value for customers and all other stakeholders and/or how value is created, delivered and extracted. References Al-Baghdadi, E. N., Alrub, A. A., & Rjoub, H. (2021). Sustainable business model and corporate performance: The mediating role of sustainable orientation and management accounting control in the United Arab Emirates. Sustainability, 13(16), 8947. https:// doi.org/10.3390/su13168947 Amit, R., & Zott, C. (2020). Business model innovation strategy: Transformational concepts and tools for entrepreneurial leaders. John Wiley & Sons. Anthony, S. D. (2012). The new corporate garage. Harvard Business Review, 90, 44–53. Berends, H., Smits, A., Reymen, I., & Podoynitsyna, K. (2016). Learning while (re)configuring: Business model innovation processes in established firms. Strategic Organization, 14(3), 181–219. https://doi.org/10.1177/1476127016632758 Bocken, N. M. P., Short, S. W., Rana, P., & Evans, S. (2014). A literature and practice review to develop sustainable business model archetypes. Journal of Cleaner Production, 65, 42–56. https://doi.org/10.1016/j.jclepro.2013.11.039 Boons, F., & Lüdeke-Freund, F. (2013). Business models for sustainable innovation: State-of-the-art and steps towards a research agenda. Journal of Cleaner Production, 45, 9–19. https://doi.org/10.1016/j.jclepro.2012.07.007 Cavalcante, S., Kesting, P., & Ulhøi, J. (2011). Paper 2: Business model dynamics and innovation: (Re)establishing the missing linkages. Management Decision, 49, 1327–1342. https://doi.org/10.1108/00251741111163142 Christensen, C. M. (1997). The innovator’s dilemma: When new technologies cause great firms to fail. Harvard Business School Press. 250 Małgorzata Kutera The financial industry will therefore have to describe in detail whether the investment products it offers comply with the EU Taxonomy. This is to increase market transparency and prevent the publication of unreliable data in this field. In April 2021, the European Commission also published a draft of a new directive on sustainability reporting (the so-called CSRD), which replaces Directive 2014/95/EU. It contributes to improving the quality of disclosed data on sustainable development and adjusting reporting to the legislative changes discussed above (including the EU Taxonomy and the SFDR). The new directive will come into force on 01/01/2024 after its adoption by member states and implementation into national legislation. As a result of the above regulations, Environmental, Social, and Governance (ESG) reporting in the EU member states has been significantly extended. The changes mainly concern four issues presented in Figure 18.2. The new directive significantly extends the scope of entities that will be required to present non-financial reports. From 2024, the new rules will become mandatory for all companies covered by the current directive. From 2025, they will apply to large units employing over 250 people (the current threshold is 500 people). Then, from 2026, the obligation will be extended to all small and medium-sized enterprises listed on the EU stock exchanges. Only microenterprises listed on the stock exchange will not be subject to the obligation. It is estimated that the new obligation will apply to approximately 50,000 business entities (A4S, 2022). The thematic scope of reporting will focus on three areas: E (Environment) – environmental factors, S (Social) – social issues, and G (Governance) – corporate governance. Individuals will have to broadly present their business models, strategies and sustainable development policies. The information is intended to explain the sustainability risk resilience, opportunities, plans to ensure the significant expansionofthe group of entities subject to thereporting obligation increasing thescope of disclosedinformation mandatory external verificationofreports electronic reportingformatXHTML Figure 18.2 Critical directions for changes in reporting included in the CSRD Source: Own study Reporting on sustainable development 251 entity’s compliance with the transition to a sustainable economy, the consideration of stakeholders and the impact of the entity, and how sustainability is incorporated into the strategy. Disclosure will also include intangible assets related mainly to intellectual capital. All the above information is to be additionally described using specific indicators. A fundamental change is the introduction of mandatory verification of nonfinancial reports by external experts. Statutory auditors will play a significant role in this, although the Directive also gives Member States the option of allowing these audits to be performed by other independent expert firms. The condition is, however, that these entities are subject to similar requirements as the auditors’ environment (mainly in the scope of the principles of independence) and have similar substantive qualifications. The audit results are to be included in a separate report. The last key change is the imposition of a strictly defined electronic format of non-financial reports. An obligation to present the disclosed information in a structured electronic XHTML format will be introduced to facilitate its presentation and comparison. The introduction of a very clear division of content according to the ESG concept is critical in the context of changes in the thematic scope of the disclosed information. Environmental factors mainly relate to how the company’s operations affect the environment and how it uses renewable and non-renewable natural resources (including the amount and type of energy used, greenhouse gas emissions, efficiency in managing natural resources, waste and the method of their disposal or the impact on the natural environment and biodiversity). Information presented in this context is to be adapted to the following objectives of the EU Taxonomy: – climate change mitigation and adaptation to these changes, – sustainable use of water and marine resources, – transition to a circular economy, – pollution prevention, – protection and restoration of biodiversity and ecosystems. Social issues concern how an individual’s business activity affects its social environment, i.e., employees, customers, suppliers and the local community. The following issues related to employee management are significant here: – equal opportunities (including gender equality, equal pay, training, employability and inclusion of people with disabilities), – working conditions, wages, social dialogue, collective agreements, employee involvement, life balance, health, safety and adaptation to the working environment, – respect for human rights, fundamental freedom rights and international standards in this area. 252 Małgorzata Kutera Table 18.1 Significant ESG reporting indicators Name of the indicator Description Type Environment Greenhouse gas emissions The total sum of direct and indirect greenhouse gas emissions. Quantitative Energy consumption The amount of energy consumed by the organisation. Quantitative The risks and benefits associated with the climate The potential negative impact of climate change on the organisation or opportunities arising from climate change. Qualitative Intensity of greenhouse gas emissions Amount of greenhouse gas emissions per unit of economic activity. Quantitative Management of emissions Description of the process that the company has implemented to reduce greenhouse gas emissions to the atmosphere and the reduction targets set. Qualitative Water consumption The amount of water used in the enterprise. Quantitative (Continued) In turn, corporate governance is a set of applied practices for supervising the operation of an enterprise. It includes procedures, standards and controls implemented to ensure effective management, improve decision-making processes, comply with the law and consider the needs of external stakeholders. Presentation of information in this area applies to: – the composition and role of management bodies (including sustainable development matters), – business ethics and corporate culture, – anti-corruption policy, political involvement, including lobbying, – business relationships, internal control systems and risk management, also for reporting processes. Not all ESG issues are equally important for every enterprise. Determining which information should be included in the report can be difficult (Camilleri, 2015; Darnall, Ji, Iwata & Arimura, 2022). In this regard, it is particularly important to select appropriate indicators, thanks to which the unit will be able to report the progress in the development of its activity related to sustainable development. Table 18.1 presents examples of indicators and their nature, broken down into three key ESG areas. Reporting on sustainable development 253 Table 18.1 (Continued) Name of the indicator Description Type Water resource management A process implemented to optimise water consumption and thus minimise the environmental impact. Qualitative Impact on biodiversity Description of the policy and actions taken to monitor and minimise the company’s impact on biodiversity. Qualitative Pollution and waste Description of activities aimed at monitoring, managing and reducing waste generated in the company. Qualitative & Quantitative Social Diversity in the supervisory organs The degree of gender diversity of the company’s management board and supervisory board. Quantitative Equal pay ratio The difference between the average salaries of men and women in the company. Quantitative Employee turnover Several instances of leaving jobs. Quantitative Freedom of association and collective negotiation Percentage of active employees covered by collective bargaining agreements. Quantitative Occupational health and safety Description of measures taken by the company to protect workers and prevent accidents in the workplace. Qualitative Human rights policy Description of the company’s human rights policy. Qualitative Due diligence procedures for human rights Description of the process of identifying the risk of human rights violations and actions taken to eliminate it. Qualitative Governance Structure of management bodies Information on the experience, competencies and independence of management board members. Qualitative (Continued) 254 Małgorzata Kutera Table 18.1 (Continued) Name of the indicator Description Type Code of ethics Description of the implemented code of ethics. Qualitative Anti-corruption policy Presentation of the anticorruption policy operating in the entity. Qualitative The mechanism for reporting violations Description of the rules for reporting suspected violations. Qualitative Data protection policy Presentation of data protection rules implemented in the company. Qualitative Source: Own study based on WSE & EBRD (2021); FEE (2011). Another interesting aspect in the context of non-financial reporting is the introduction of the concept of double materiality, which makes it easier for enterprises to make decisions about the substantive scope of disclosures. Thus, “environmental and social materiality” and “financial materiality” are distinguished (Krasodomska & Godawska, 2021). To prepare an accurate, sustainable development report, each company should undergo a certain content selection process bearing in mind both of the above perspectives (Baumüller & Sopp, 2022). It is presented in Figure 18.3. The first step is to identify all factors related to sustainable development that could potentially affect the company and vice versa. Then, the individual selects from among them factors that are directly related to its activities and having a significant impact on people and the environment, taking into account the current and future time perspective (environmental and social materiality). At a later stage, you should already be guided by financial materiality. From the above broad set of factors, we select those that create or weaken the value of the enterprise and are, therefore financially significant. The last stage is to identify the issues the financial effects of which have already been presented in the financial statements of the entity. It is worth adding that this disclosure is completely voluntary. The concept of identifying important issues of sustainable development for the company using double materiality has been quite well implemented in the practice of non-financial reporting. It is worth mentioning, however, that this process should also be supported at the legislative level. In particular, it is about preparing some general statements presenting factors important from the point of view of international or national sustainable development policy. Similar industry-specific guidelines should also be developed. Reporting on sustainable development 255 It should be strongly emphasised that currently, one of the biggest problems All sustainability matters affected by or having an effect on the entity (is not subject to disclosure) Sustainability matters that reflect the entity's significant impacts on the environment and people (obligatory disclosure) Sustainability matters that create or erode enterprise value and are therefore financially significant (obligatory disclosure) Sustainability matters already reflected in the financial reports (voluntary disclosure) Figure 18.3 Scope of non-financial disclosures based on the double materiality concept Source: Own study based on EFRAG (2021) Figure 18.4 Main types of non-financial reporting Source: Own study 256 Małgorzata Kutera It should be strongly emphasised that currently, one of the biggest problems with sustainability reports is their complete lack of comparability. The legal regulations presented above generally focus on the substantive scope of the information presented without indicating specific methods of its disclosure. Therefore, three options for reporting issues related to sustainable development have been developed. They are shown in Figure 18.4. Enterprises include nonfinancial information as part of the annual management report, prepare a separate report on sustainable development, or prepare one report presenting financial and non-financial data. Due to the lack of separate and unified standards for non-financial reporting, entities are now using various available options for disclosing this data developed by selected international organisations (Breijer & Orij, 2022). The most important institutions that created the reporting framework used so far are (A4S, 2022): – Global Reporting Initiative (GRI) – established in 1997. It is the first organisation to develop global non-financial reporting standards, and they are now used by the largest number of companies in the world. GRI mainly relates to the preparation of separate reports on sustainable development and takes into account various groups of stakeholders. The standards present guidelines in the following areas: general, economic, environmental and social, – International Integrated Reporting Council (IIRC) – established in 2010 and transformed in 2021 into Value Reporting Foundation (VRF) (after merger with Sustainability Accounting Standards Board (SASB)). The organisation has developed an integrated reporting framework based on six kinds of capital necessary in the process of creating enterprise value: financial, manufacturing, intellectual, human, social and natural. The guidelines mainly address investors’ information needs, – SASB – founded in 2011 and later functioning as the VRF (due to the merger with the IIRC as presented above). It has developed standards that are mainly used by US companies that also represent only the investor’s perspective. They cover the following areas: the environment, social capital, human capital, business model and innovation, leadership and corporate governance, – Climate Disclosure Standards Board (CDSB) – established in 2007. CDSB is an international consortium of businesses, and environmental nongovernmental organisations (NGOs) committed to developing and adapting a global corporate reporting model to align natural and social capital with financial capital. As a result of integration processes, this organisation no longer functions, – Carbon Disclosure Protocol (CDP) – founded in 2000. This organisation supports companies in measuring and disclosing their environmental impact. The CDP aims to disseminate environmental reporting and risk management and promote activities for a sustainable economy. Reporting on sustainable development 257 In the last two years, there have been very intense merger processes between the organisations mentioned. In November 2020, IIRC and SASB announced their decision to merge into a single organisation called the VRF. The new organisation was established in June 2021. For a short time, it developed the concept of integrated reporting and set standards for sustainable development reporting based on cooperation with GRI, CDP and CDSB. Ultimately, however, it was decided that the best solution would be the development of standards by the International Financial Reporting Standards (IFRS) Foundation, which has been harmonising, establishing and improving the financial reporting of entities on a global scale for many years. The International Sustainability Standards Board (ISSB) was created within the IFRS Foundation to guide the process of setting standards for non-financial reporting. Therefore, further integration processes took place. In January 2022, the IFRS Foundation brought into fold the CDSB, and in August 2022, the VRF. Work is currently underway to create new global standards. The first projects concerning climate-related disclosures and general sustainability-related disclosures have been developed. It should be emphasised that at the European Union level, intensive work is also underway on the standardisation of sustainable development reporting. They are mainly run by the European Financial Reporting Advisory Group (EFRAG). Together with the new directive, the European Commission also wants to issue the European Sustainability Reporting Standards, which will be used by all companies when preparing new reports. The standards are divided into two basic groups: general guidelines for all entities obliged to present non-financial reports and sector-specific standards. In April 2022, work on 13 cross-sectional and topical standards was completed and publicly consulted. This process was completed in August 2022. Work is currently underway on sector-specific standards, which are to be submitted for public verification in February 2023. About 40 sectorspecific standards are planned to be developed in total. The final adoption of the first set of general standards is expected in June 2023, and sector-specific standards in June 2024. At present, the following general standards have been developed: 1 Cross-sectional standards: – ESRS 1 General principles – ESRS 2 General, strategy, governance, and materiality assessment disclosure requirements 2 Topical standards: a) Environment – ESRS E1 Climate change – ESRS E2 Pollution – ESRS E3 Water and marine resources – ESRS E4 Biodiversity and ecosystems – ESRS E5 Resource use and circular economy b) Social – ESRS S1 Own workforce 258 Małgorzata Kutera – ESRS S2 Workers in the value chain – ESRS S3 Affected communities – ESRS S4 Consumers and end-users c) Governance – ESRS G1 Governance, risk management, and internal control – ESRS G2 Business conduct In addition to the above, general guidelines have also been prepared, which will not have the rank of applicable standards but serve as auxiliaries to understand them better. These include the following Conceptual Guidelines: – ESRG 1 Double materiality – ESRG 2 Characteristics of information quality – ESRG 3 Time horizons – ESRG 4 Boundaries and levels of reporting – ESRG 5 EU and international alignment – ESRG 6 Connectivity Currently, the most popular non-financial reporting standards are the guidelines prepared by the GRI. They are used by about 78% of enterprises belonging to the 250 largest corporations in the world (KPMG, 2022). Over the last two years, the percentage of companies basing their reporting on GRI principles has increased by over 5%, although there is a clear difference between individual regions. The standards are most popular in the Americas (75%) and least used in the Middle East and Africa (62%). It should be mentioned that the above guidelines are very extensive and detailed. The last updated full version of the standards, published in June 2022, contains 867 pages and covers the issues included in Table 18.2. The scale of non-financial reporting in global terms is constantly increasing. A dynamic upward trend can be observed since the beginning of this century. Today, almost all of the world’s largest corporations publish their sustainability data. In 2022, such information was presented by as many as 96% of entities belonging to the 250 largest global enterprises. Chinese entities are the only companies in this group that do not prepare non-financial reports. However, the situation will change, as from mid-2022, also in China, an obligation to publish data on sustainable development was introduced, mainly in environmental and social matters (KPMG, 2022). The Asia Pacific region is the clear leader in reporting, where such reports are prepared by 89% of entities belonging to the 100 largest companies in the world. The next place is taken by: Europe (82%), both Americas (74%) and the Middle East and Africa (56%). There are also countries where all the most prominent corporations disclose non-financial data – Japan, Singapore, Germany and the United States (KPMG, 2022). It should be stated that the role of non-financial reporting is growing. The main emphasis in this matter is due to various stakeholder groups. These also include investors who expect benefits resulting from building the company’s value Reporting on sustainable development 259 in the long run. However, the legislation in force so far in the field of reporting on sustainable development has turned out to be insufficient. First of all, entities publish data on very diverse subjects and degrees of detail. In addition, there is no uniform form of reporting. The above problem has already been identified, and intensive work is currently underway to harmonise these rules both at the Table 18.2 List of global reporting initiative standards GRI number Description The year of publication GRI 1 Foundation 2021 GRI 2 General disclosures 2021 GRI 3 Material topics 2021 GRI 11 Oil and gas sector 2021 GRI 12 Coal sector 2022 GRI 13 Agriculture, aquaculture and fishing sectors 2022 GRI 201 Economic performance 2016 GRI 202 Market presence 2016 GRI 203 Indirect economic impacts 2016 GRI 204 Procurement practices 2016 GRI 205 Anti-corruption 2016 GRI 206 Anti-competitive behaviour 2016 GRI 207 Tax 2019 GRI 301 Materials 2016 GRI 302 Energy 2016 GRI 303 Water and effluents 2018 GRI 304 Biodiversity 2016 GRI 305 Emissions 2016 GRI 306 Effluents and waste 2016 GRI 306 Waste 2020 GRI 308 Supplier environmental assessment 2016 GRI 401 Employment 2016 GRI 402 Labour/management relations 2016 GRI 403 Occupational health and safety 2018 GRI 404 Training and education 2016 GRI 405 Diversity and equal opportunity 2016 GRI 406 Non-discrimination 2016 GRI 407 Freedom of association and collective bargaining 2016 GRI 408 Child labour 2016 GRI 409 Forced or compulsory labour 2016 GRI 410 Security practices 2016 GRI 411 Rights of indigenous peoples 2016 GRI 413 Local communities 2016 GRI 414 Supplier social assessment 2016 GRI 415 Public policy 2016 GRI 416 Customer health and safety 2016 GRI 417 Marketing and labelling 2016 GRI 418 Customer privacy 2016 Source: Own study based on GRI (2022). 266 Index information 2, 72, 113, 128, 129, 133– 135, 150, 151, 156, 196, 203, 246–252 innovation: business model 237–239; implementation of 242–243; in sustainable development, role of 235–243 innovative marketing 153 innovativeness 236 intellectual growth 12 inter-generational equity 77 intergenerational justice 65, 77, 82, 93, 126 Intergovernmental Panel on Climate Change (IPCC) 66, 68, 70, 72; “Sixth Assessment Report: Impacts, Adaptations and Vulnerability” 67 Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) 72; “Global Assessment Report on Biodiversity and Ecosystem Services, The” 68 International Financial Reporting Standards (IFRS) 257 International Integrated Reporting Council (IIRC) 256, 257 International Labour Organization (ILO) 126; on gender equality 50; on social responsibility 147 international law, sustainable development in 5–10, 12–13 International Monetary Fund 190 international poverty line (IPL) 47 intra-generational equity 77 IPBES see Intergovernmental SciencePolicy Platform on Biodiversity and Ecosystem Services (IPBES) IPCC see Intergovernmental Panel on Climate Change (IPCC) IPL see international poverty line (IPL) ISO 26000 97 Jagiellonian University 114 Jennings, M. M. 135 Jensen, M. C. 177, 204 Johannesburg Declaration 121 John, C. H. St. 204, 205 justice 53; intergenerational 65, 77, 82, 93, 126 Karoly, M. 224 Keim, G. D. 204 key performance indicators (KPIs) 247 Kiev Declaration (2003) 124 Klassen, R. 110 Kleine, D. 177 kleptocracy 192 Koch, Max 71 Kołodko, G. W. 191 Kotler, P 152, 153 Kotler, S. 219 Kozar, Ł. 108 KPIs see key performance indicators (KPIs) Krajnc, D. 123 Kurzweil, R. 219 Kyoto Protocol 8 Laloux, F. 224–233; Reinventing Organizations 224 Lauritzen, F. 126–127 lean production 121–124 Lebel, L. 123 legal responsibilities 99 Lenton, T. M. 68 Levitt, T. 190 Lewis, M. W. 177 limitations 196 linear economy-based approach 120 Lisbon Strategy 2000 11, 12 Lisbon Treaty 11 Liu, J. 177 Living Planet Index 54 Longoni, A. 110 Lorek, S. 123 Lowell Center 123 Ma, H. Y. 112 MaaS see Mobility-as-a-Service (MaaS) Maastricht Treaty: Article 3(2) 10; Article 3(3) [197]; Article 3(5) 10; Article 21(2) 10 Machado, C. G. 122 macro-marketing 151 MACS see management accounting control systems (MACS) management accounting control systems (MACS) 242 Maon, F. 177 Markandya, A. 6 marketing: consumer-oriented 153; customer value 153; definition Index 267 of 148; eco-marketing 151; environmental 151; ethical 151; green 146, 150–151; innovative 153; macro-marketing 151; mix 154; sense-of-mission 153; societal 151, 153; sustainability in 151–156; sustainable see sustainable marketing Marketing 1.0 151 Marketing 2.0 151 Marketing 3.0 151 Marsden, C. 209, 210 Martec’s law 220, 220, 221 Martin, D. M. 148 McCarthy, E. J. 153 MDGs see Millennium Development Goals (MDGs) Meadows, D. H.: Limits to Growth 5–6 Meadows, D. L.: Limits to Growth 5–6 Mignolo, W. 73 Millennium Declaration 8, 9, 20, 25 Millennium Development Goals (MDGs) 20, 21–22, 25 Mitchell, R. K. 208 Mobility-as-a-Service (MaaS) 159 Moore’s Law 219 Morsing, M. 212 multiple perspectives on sustainable development 77–87 Najjar, R. 80 natural capital 5, 148, 243 needs 196 neoclassical theory of companies 95 New Economics Foundation 54 Newton Foote, E. 67 9R-strategy 121 non-financial reporting 255 no poverty 47, 47 Obłój, K. 207 O’Brien, Ch. 123 OECD see Organisation for Economic Cooperation and Development (OECD) organisation: dealing with education and growth, shape of 223–224; description of 224–225; environment, changes in 218–223, 219–223; sustainable development in 94–95 Organisation for Economic Cooperation and Development (OECD) 6, 8; Better Life Index 59 Pagella, M. 110 Paris Agreement 9, 25, 37, 67 Passet, R. 63 Pawłowski, A. 83, 84 peace 53 Pearce, D. 6 Peattie, K. 151–152 Peterson Institute for International Economics (PIIE) 191 philanthropic responsibilities 99 PIIE see Peterson Institute for International Economics (PIIE) Piketty, T. 196 planetary boundaries framework 66 political economy perspective of environmental sustainability 63–73, 64 political sustainability 83 Pomering, A. 153–154 Porter, M. 190 “post-growth” economy 71 product sustainability 155 profit maximization 2, 179 quality education 49–50, 49, 50 quality of life 7, 11, 54, 55, 63, 71, 77, 93, 95, 102, 108, 126, 146, 147, 162 Randers, J.: Limits to Growth 5–6 Raworth, K. 53, 66 Reeves, M. 242 Reinventing Organisations Map 224–233, 226, 227, 230, 231 reporting on sustainable development 246–260 Report of the World Commission on Environment and Development: Our Common Future 1 Rio Declaration on Environment and Development (The Rio Declaration) 7, 19 Ritchie, H. 70 Robertson, R. 191 Rogers, D. S. 135 Salvador, A. 192 Sankowska, A. 108 Sarkis, J. 177 268 Index SASB see Sustainability Accounting Standards Board (SASB) Savanevičienė, V. 177 SBMI see sustainable business model innovation (SBMI) Schouten, J. W. 148 Schultz, M. 212 Schumpeter, J. 235, 236 SD see sustainable development (SD) SDGs see Sustainable Development Goals (SDGs) SDI see Sustainable Development Index (SDI) Seghezzo, L. 82 sense-of-mission marketing 153 servitisation: definition of 160–161; and sustainability 161–162; sustainable, in automotive sector 159–168 seven-dimensional model 85–86 Shevchenko, A. 110 Single European Act of 1986 10 SIO see sustainable innovations orientation (SIO) Sisco, C. 134 Sisodia, R. 204 six-dimensional model 83–85 Slawinski, N. 177 Smith, K. G. 177 Snower, D. J. 195 social capital 34, 126, 243, 256 social dimension of sustainable development 46–60; aggregated measures 53–60, 55 socially responsible supply chain 134–135 social metabolism 70 social sustainability 73, 83, 110, 115, 160, 162, 166–168; CSR and 98 societal marketing 151, 153 socio-economic development 147 Song, H.-C. 209 spatial justice 65 SPM see sustainable project management (SPM) SRC see Stockholm Resilience Centre (SRC) SSI see Sustainable Society Index (SSI) stakeholders: dangerous 208; demanding 208; dependent 208; discretionary 208; dominant 208; dormant 208; engagement, planning and assessing 211; primary 206; relations management 206–208; shaking 213; in sustainable development, role of 203–214; theory of 203–206 Stakeholder Theory 96 Stanford Research Institute (now SRI International, Inc.) 203 Stankevičiūtė, G. 177 steady-state economy 71 Stockholm Declaration 6, 7 Stockholm Resilience Centre (SRC) 65, 66 Styk, K. 207 Sulkowski, A. J. 213 Sundaram, A. 177 sustainability: biophysical 64; communication strategies 212– 213; definition of 176; economic 73, 83, 115, 159, 162, 163, 165– 166; environmental 63–73, 83, 110, 112, 135, 152, 163–165, 167, 168, 177, 180, 197; in marketing 151–156; political 83; product 155; social 73, 83, 115, 160, 162, 166–168; see also individual entries Sustainability Accounting Standards Board (SASB) 256, 257 sustainable business management 107–117; models of 115–116; principles of 112 sustainable business model innovation (SBMI) 239–242; definition of 240; evolution of 239; type of 240–242 sustainable cities and communities 51, 52 sustainable degrowth 70, 73 sustainable development (SD) 1; basis/ theoretical introduction 92–94; conditions for 19; CSR and 91– 102; definition of 92–93, 108–111, 109; dimensions of 78–86, 79, 93, 94; economic dimension of 33–38; in European law 10–12; five-dimensional model 81–83; four-dimensional model 78–81; institutional dimension of 78–80; in international law 12–13; legal and historical aspects of 5–13; multiple perspectives on 77–87; Index 269 in organisation 94–95; reporting on 246–260; role of globalization in 189–198; role of stakeholders in 203–214; seven-dimensional model 85–86; six-dimensional model 83–85; social dimension of 46–60, 47; see also individual entries Sustainable Development Goals (SDGs) 1, 9, 81, 100, 159; assessment and relationships 18–29; in the past and now 19–27; relationship between 27–29; social dimension of 46–60; summary of 21–23; threats to implementation of 27 Sustainable Development Index (SDI) 57–58, 57 sustainable growth 12, 25, 218, 224 sustainable HRM (Su-HRM) 172–182 sustainable innovations orientation (SIO) 242 sustainable marketing 146–156; critiques of 148–151; definition of 148; responsibility and 146–148 sustainable mobility 37, 159–162 sustainable production 120–129; circular economy 121–124; economic, environmental and social pillars of 124–127; Industry 4.0 121– 124; lean production 121–124; principles of 127–129 sustainable project management (SPM) 115 Sustainable Society Index (SSI) 58–59, 58 sustainable supply chains 133–139; circular supply chain 136, 137; closed-loop supply chains 137–138; definition of 134; green supply chain 135–136; socially responsible supply chain 134–135 Szabolcs, E. 224 Taylor, B. 204 TBL see triple bottom line (TBL) TerraChoice 150 TEU see Treaty on European Union (TEU) TFEU see Treaty on the Functioning of the European Union (TFEU) TH Köln 58 transnational corporations 192 Treaty of Amsterdam 11 Treaty of Rome 10 Treaty on European Union (TEU) see Maastricht Treaty Treaty on the Functioning of the European Union (TFEU): Article 11 11; Article 191 66 triple bottom line (TBL) 77, 91, 99, 110, 123, 133, 139, 154, 177, 203, 209, 210 Triple Sustainability Cube Model 115 Tumer, R. 6 Tushman, M. L. 177 2030 Agenda for Sustainable Development 1, 9, 22–24, 25, 81, 111, 129, 147, 159, 209 2030 World Development Strategy 81 UN see United Nations (UN) UNCED see UN Conference on Environment and Development (UNCED) UN Conference on Environment and Development (UNCED) see Earth Summit (1992) UN-CSD see United Nations Commission on Sustainable Development (UN-CSD) UNFCCC see United Nations Framework Convention on Climate Change (UNFCCC) UN General Assembly 6 UNITAR 210 United Nations (UN): 2030 Agenda for Sustainable Development 1, 9, 22–24, 25, 81, 111, 129, 147, 159, 209; DESA 210; SDGs see Sustainable Development Goals (SDGs) United Nations Commission on Sustainable Development (UNCSD) 78 United Nations Conference on Environment and Development (1992) 208 United Nations Conference on Sustainable Development 9 United Nations Conference on the Environment (1972) 6 United Nations Development Program 55 270 Index United Nations Framework Convention on Climate Change (UNFCCC) 7, 8 United Nations Rio+20 Conference (2012): “Future We Want, The” 208–209 Urban Health Initiative 51 Value Reporting Foundation (VRF) 256, 257 Vanclay, F. 210 Van Wassenhove, L. N. 137 Veleva, V. 123, 127 Vogt, M. 85 VRF see Value Reporting Foundation (VRF) Wańtuchowicz, M. 108–109 Warsaw Business School 114 Watts, P. 123 WCED see World Commission on Environment and Development (WCED) Weber, C. 85 Whittlesea, E. 155 Wiles, Ch. 123 Wilkinson, A. 92 Wit, B. 115–116 World Bank 47, 64 World Commission on Environment and Development (WCED) see Brundtland Commission World Health Organization: globalization, definition of 191 World Health Organization (WHO): on sustainable cities and communities 51, 52; Urban Health Initiative 51 World Summit on Sustainable Development (WSSD) 8, 121 World Wide Fund for Nature (WWF) 68, 70, 72 WSSD see World Summit on Sustainable Development (WSSD) WWF see World Wide Fund for Nature (WWF) XR see Extinction Rebellion (XR) Yoo, J. Y. 112 Young, D. 241–242 Zeitung, F. A. 190 zero hunger 48, 48