Business Ethics and Sustainability: A Report on LECO's Practices

This report provides a critical assessment of the Lanka Electricity Company Private Limited (LECO) from the perspective of business ethics and sustainable development. The analysis examines LECO's role in the energy generation and supply industry in Sri Lanka, focusing on its ethical practices, corporate social responsibility (CSR) initiatives, and its contributions to achieving the United Nations' Sustainable Development Goals (SDGs). The report evaluates LECO's environmental, social, and economic impacts, highlighting its use of renewable energy sources, its efforts to provide affordable and clean energy (SDG-7), and its approach to responsible consumption and production (SDG-12). The study also offers recommendations on how LECO can further improve its sustainability efforts, contributing to global sustainability goals. The report concludes that LECO is making appreciable efforts to preserve environmental resources and recommends further improvements in the areas of affordable, clean energy and responsible energy consumption and production.

Running Head: ETHICAL JOURNAL 0
Business Ethics
Business ethics and Sustainability
(Student Details :)
12/31/2018

Ethical Journal 1
Contents
Abstract.........................................................................................................................2
Business ethics and Sustainability...............................................................................3
Introduction...................................................................................................................3
Theoretical/conceptual approaches.............................................................................5
Environmental, Economic and Social aspects of LECO...........................................8
Analysis.......................................................................................................................13
SDG-7: Affordable and Clean energy.....................................................................13
SDG-12: Responsible consumption and production...............................................14
CSR Activities of the LECO in Sri Lanka................................................................16
Conclusion..................................................................................................................17
References.................................................................................................................19

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Abstract
Business ethics and sustainability are strongly interrelated as ethical consumption,
production and distribution of energy is the key to sustainability. Sustainability means
the availability of resources for the currently living community and future generations
as well. In this way, the discussion is an attempt to know the key requirements of
sustainability goals achievement.
For doing so, here a company LECO is been considered for the analysis. The report
have analysed the energy generation as well as supply industry with the help of the
company ‘Lanka Electricity Company Private Limited (LECO)’ of generating,
supplying energy as well as manufacturing energy smart meter using renewable
energy resources. Besides, all 17 sustainable development goals (referred as SDGs)
which are declared by United Nations are also been accessed for the critical analysis
of the LECO from the perspective of global sustainability in all areas of human living
on earth.
Thus, it is hoped this study will help environmentalists, human beings, government
as well as industrialists of our nation for achieving sustainability for the whole world
while doing business in ethical barriers. In this way, it has been successfully found
that LECO is giving appreciable efforts to preserve our environmental resources for
long-time, and this report also have recommended some useful suggestions in order
to help the company to improve in the areas of affordable, clean energy as well as
responsible consumption and production of energy.

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Business ethics and Sustainability
Introduction
This report is aiming to critically assess the energy generation and supply industry
from the perspective of business ethics as well as sustainable development goals
implementation. Here the Lanka Electricity Company Private Limited (LECO) is been
chosen as the organization to be assessed for the energy sustainability worldwide.
Source: (Bass & Dalal-Clayton, 2012)
The LECO is the greatest electricity distribution company of Sri Lanka with market
shares of about 20 per cent. The company controls all major functions related to
energy distribution as well as energy smart meter manufacturing in Sri Lanka. LECO
is an ethical as well as renewable energy supplier. The LECO Company is
committed towards building an energy generating, supplying entity which consumers
willing to stay with long time-period. LECO is promising to be transparent and fair
because they want to bring back the public’s trust in the energy production as well as

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supplying industry. For achieving above, LECO supply their consumers safely and
efficiently; listen to them as well as offer good personal consumer service.
Source: (LECO, 2018)
Thus, the report is emphasizing on critically assessing the energy production and
supplying industry in which the LECO operates from the perspective of business
ethics or Corporate Social Responsibility (CSR). Furthermore, the report will also
evaluate the extent of the organisation’s efforts considering environmental, social as
well as economic aspects. Additionally, two of the United Nations Sustainable
Development Goals (SDGs) will be discussed so that recommendations on how the
LECO could improve further in those discussed SDGs areas can be provided (United
Nations, 2018).

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Source: (Birol, 2018)
Theoretical/conceptual approaches
Energy generating and supplying companies, especially those are producing from
fossil fuels: oil, coal, natural gas, are prone to attack by the ecologists as well as
their supporters in the media. Although people criticize the conventional sources
using energy companies for disastrous pollution yet attacking these companies is not
suggested because ultimately they generate fossil fuels, without which people
cannot survive for heating their home; producing our food; powering cars, trains and
buses (Nelder, 2009). People use conventional resources as fuel for electrical power
that people need for lighting as well as for all the information technology they use on
daily basis, from our mobile phones to computers. Thus, world cannot stop those

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companies from generating energy and supplying it to their consumers just because
they are using a lot of fossil fuels or conventional natural resources. On the other
hand, one thing which can be done is that we can imply business ethics strictly over
all energy supplying as well as generating companies. Society can contribute by
eating more slowly, travel locally through energy saving alternative vehicles, and
relish only entertainment and recreation which requires minimal or no utilise of fossil
fuels (Union of concerned Scientists, 2018).
Source: (LECO, 2018)
Moreover, any energy generating and supplying company can be considered an
ethical one, when they aim to help thousands of peoples for having a meaningful
association with the clean energy projects. Further, there are many aspects through
which business ethics and morality of an energy supplying company can be
assessed:

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 Company should effort to deliver an encouraging return for their investors
while having a worthwhile connection to renewable energy considering an
environmental and social impact.
 The business shareholders must be capable to trust the company for doing
well.
 The way company conducts the business lies in their core values as well as
gives a moral scope for running as a company.
 To be ethical during business, the company must be transparent as well as
strive for to actively engaging with their investors from published statutory or
voluntary communications (Williams, 2014).
 The energy company should adopt the governance as well as ethics code.
 The company must be contributing to the evolution to a smarter and cleaner
energy system.

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Source: (LECO, 2018)
Environmental, Economic and Social aspects of LECO
Social impacts of LECO are as follows:
 Successful operation of LECO will eliminate social inequality, for example the
arrangement of distributed renewable energy sources (RES) motivates rural
areas for their overall development. LECO will supply energy to all of the
consumers in a way that they can become the owner of their own energy; this
idea will greatly influence rural areas as they can access clean and adequate
energy with the help of LECO.
 By creating a modern as well as efficient distribution network in Sri Lanka
LECO is affecting society in a positive way and ultimately the world will grow
because of generating energy from renewable resources and supplying it into
needed areas.

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 The LECO’s objective of lighting up Sri Lanka is achieved above the
expectations while evaluated post 29 years of operations which is showing
that company has done a lot for the Sri Lankan society.
 The LECO is modelling new energy culture for the energy future worldwide.
 LECO being an energy supplier, will enhance energy security of houses
greatly because the company aims to make the households consumers their
own energy supplier and wants to get the trust of them.
Source: (Dresner, 2008)
Environmental impacts of LECO are as follows:
 Carbon emissions

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 NOx, SOx, PM10, PM2.5 emissions which cause negative effects on human
health
 Landscape and biosphere Interference
 Amount of waste generating through energy generation
 Risk of accident/failure for example: worst accidents of nuclear reactors
 Environmental contamination due to long-time storage of radioactive materials
 Efficiency of the resources in the economy (World Bank, 2015).
Economy impacts of LECO are as follows:
 GDP growth
 Land requirement: due to less efficiency, total energy produced per unit land
occupied is less for most of the renewable energy sourced technologies
 LECO will encourage balanced development of various regions
 Trade balance
 Unemployment rate: if there will be a significant imbalance in the labour
market then this rate will increase.
 Innovativeness and competitiveness of economy will be increased
 Energy security of public sector and enterprises will be enhanced (Nelder,
2009).

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Source: (World Bank, 2015)
In this way, LECO’s social, environmental as well as economic aspects has been
evaluated and summarized from the perspective of business ethics and
sustainability. Ethical responsibilities of this energy generating and supplying
company include following: There should be no harm to the natural resources while
harnessing them for supplying energy purposes. Energy generating process must
not include any excessive harnessing of fossil fuels. Renewable resources must be
utilized as much as possible. There should be limitation over making business from
supplying energy to the human society as people cannot live without using energy
and its use is mandatory hence it should be accessible and economic. Policy
framework made for electricity supply industries have been followed strictly by the
LECO (Griggs et al., 2013). In this context, LECO is a renewable and ethical
energy supplier because of the reason that LECO effectively sells gas and electricity
to their customers. The energy in LECO derived from the renewable resources of
solar, wind, hydro and tidal. It is well-known that National Grid is a big bucket