Why are environmental issues becoming more important for international Essay

Why are environmental issues becoming more important for international business - Essay Example It is a fact that environmental issues have managed to strike â€Å"increased discussion on the international business horizon† (Cherunilam 2010: 670). It is generally suggested that environmental trends and standards play a significantly valuable role in determining relative success of different products in the international market so the importance of efforts directed at protecting the global environment should not be undermined on the basis of a few negative effects. This belief has resulted in fueling the development and implementation of many environmental management systems around the globe. Different ways by which environment influences business are heavily acknowledged now (Lozada & Polonsky 1993: 20). Recently, the popularity regarding the existence of the link between business and environment has exploded. A wide variety of reasons could be found explaining why businesses now lay a greater emphasis on their environmental policies and services instead of solely focusi ng on profit maximization which would be contemplated in this essay with the help of research literature. Research evidence identifies that modern environmental concerns challenging the business world â€Å"have their roots in the 1960s† (Johnson & Turner 2010: 382), but it has only been some years that these issues have really exploded onto the surface. General consensus today is that with growing awareness the business world has undergone gigantic transformation for the better and as a result of which international business has remarkably affected the environment as well. It is proposed that environmental issues are becoming increasingly important for businesses because low environmental protection standards lead to depressing losses every year. Even those countries which have embraced high environmental standards and where business organizations take great pains to establish strictest policies have to suffer from significant losses which are estimated to be 1-2% of GNP. Th e condition is even worse in the developing world where businesses have not yet adopted high standards due to gross economical contractions and where losses resulting from poor environmental protection have been reported to reach 3-5% of GNP (Wysokinska & Witkowska 2005: 270). This is why more stress is laid on environmental protection in the modern business world now because flawed policies and insufficient investments made in this field adversely affect business organizations. Also there are more governmental environmental regulations and requirements set by the government, customers, and suppliers now due to which business organizations come under pressure to address these issues (Lozada & Polonsky 1993: 20). Research literature makes it obvious that this obsession of international business with different environmental issues encompass a wide variety of subjects from promoting protection of natural resources and discouraging the imports of products deemed destructive to the envir onment to banning any products which may pollute the atmosphere or contain toxic metal compounds. For example, the Environmental Protection Agency in the US establishes certain restrictions on â€Å"the importation of lead and lead articles that constitute toxic substances† (Hinkelman et al. 2005: 829). As a consequence of banning the import of all goods which hold the potential to negatively interfere with natural environment, both positive and negative effects influence the economy of a country. Research indicates that while limiting the import helps in raising the environmental standards by reducing the rate of goods which could destroy or pollute the environment like noisy vehicles, this practice also exerts a bad influence on the regular â€Å"