Agency (EPA). The EPA was created in 1970 to coordinate environmental agencies involved in conducting environmental research, providing assistance in reducing pollution, and enforcing the nation’s environmental laws. A significant number of laws were promulgated to address both general and specific environmental issues, including public health, threat- ened species, toxic substances, clean air and water, and natural resources. Some of the most important environmental laws include the Clean Air Act, the Endangered Species Act, the Toxic Substances Control Act, the Clean Water Act, the Pollution Prevention Act, the Food Quality Protection Act, and the Energy Policy Act. Alternative energy sources also have a major impact on many stakeholders. Some of the major alternative forms of energy include wind, geothermal, solar, nuclear, biofuels, and hydropower.
Better environmental performance can increase revenue in three ways: through bet- ter access to certain markets, differentiation of products, and the sale of pollution-control technology. Good environmental performance also reduces costs by improving risk man- agement and stakeholder relationships, reducing the amount of materials and energy used, and reducing capital and labor costs.
Green marketing is a strategic process involving stakeholder assessment to cre- ate meaningful long-term relationships with customers while maintaining, supporting, and enhancing the natural environment. However, some companies desire to obtain the benefits of green marketing without the investment. Greenwashing involves misleading a consumer into thinking a product or service is more environmentally friendly than it really is. While it might seem to be helpful to a firm, companies discovered engaging in greenwashing may suffer reputational damage.
Businesses have responded to the opportunities and threats created by environmen- tal issues with varying levels of commitment. Those firms proactive in anticipating risks and environmental issues develop strategic management programs that view the environ- ment as an opportunity for advancing organizational interests. Many organizations engage in recycling, the reprocessing of materials, especially steel, aluminum, paper, glass, rub- ber, and some plastics, for reuse. Additionally, stakeholder assessment, risk analysis, and the strategic environmental audit are important parts of a high-commitment approach to environmental issues. Stakeholder assessment is a process that acknowledges and actively monitors the environmental concerns of all legitimate stakeholders. Through risk analy- sis, it is possible to assess the environmental risks associated with business decisions. Organizations highly committed to environmental responsibility may conduct an audit of their efforts using standards such as ISO 14000 and report the results to all interested stakeholders.