Business Ethics and Sustainability: A Report on Patagonia's Approach

This report provides a comprehensive analysis of Patagonia's business ethics and sustainability practices. It begins by evaluating the ethical and sustainability issues raised by Patagonia's approach, with a specific focus on supply chain management, human rights, and climate change. The report then explores the interdependencies between shareholder values and sustainable values that Patagonia must consider to achieve a competitive advantage, examining economic, social, legal, and environmental factors. Furthermore, it identifies the strategic and operational dimensions involved in implementing Patagonia's approach in other businesses, highlighting the need for risk assessment, complex operational processes, and initiatives such as gender equality and CSR. Finally, the report identifies the opportunities and challenges inherent in addressing ethics and sustainability issues within the industry, emphasizing the importance of environmental protection and sustainable development, and offering insights into how businesses can contribute to a more sustainable future. This report provides valuable insights for students studying business ethics and sustainability, available on Desklib.

Individual project
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1. Identify and critically evaluate the issues Patagonia's approach to business raises from a
business ethics and sustainability perspective with particular reference to supply chain
management, human right and climate changes.....................................................................3
2. When considering environmental and social objectives, what are the interdependencies
between shareholder values and sustainable value that Patagonia needs to consider to achieve
competitive advantage............................................................................................................5
3. Identify both strategic and operational/practices dimensions involved in implementing
Patagonia's approach in other businesses...............................................................................6
4. Identity the opportunities and challenges which are inherent in addressing the ethics and
sustainability issues within this industry................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
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INTRODUCTION
Ethics and sustainability perspectives is very important part of organisation and it will
lead to have major impact on successfully performing business practices. It is important for
business to consider ethics and values while performing and conducting business task as it will
help in meeting with the need of customers and organisation without any harm to environment
and society (Scott and Pfahl, 2017). This report is based on Patagonia company. This
organisation was developed in 1950s and founder of this company Yvon Chouinard. He is
young rock climber and became the leading suppliers of climbing hardware in US. This report
will include evaluation of issues Patagonia's approach. In this interdependencies between
shareholder value and sustainable values has been determined. This report will include both
strategic and operational dimension involved in implementing Patagonia's approach. Apart from
this different opportunities and challenges for addressing ethics and sustainability issues has been
identifies.
MAIN BODY
1. Identify and critically evaluate the issues Patagonia's approach to business raises from a
business ethics and sustainability perspective with particular reference to supply chain
management, human right and climate changes.
There are different issues related to ethics and sustainability that will lead to have impact
over business and its practices. It is essential for organisation to consider perspective of
sustainability and ethics while performing business task as it will lead to have positive impact
successfully performance of organisation. Ethics and sustainability is consider as the moral
responsibility of organisation (Vukomanović, Young and Huynink, 2016). Through
consideration of ethics business will be able to resolve issues and problems of society and
customer. It is important for effective and efficient functioning of business. Different issues
Patagonia's approach to business raises form business ethics which is related to supply chain
management, human right and climate changes are mention below - Conscious climb – Changes is climate is the major issues that will affect he functioning
of business. Due to changes in climate various problems related to raw material increase
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and company is not able to successfully create products. Yvon Chouinard has decided to
forge reusable piton out of old harvesters blade. Equipment of Chourinard has become
the leading suppliers of climbing hardware. Due to environment damage in development
of pitons this organisation has stopped manufacturing of pitons. This is the first move
consider by company for reducing environmental damage as well as sustainability of
environment. Due to this move, corporation is consider as true environmental and social
responsibility (Bredin and et.al., 2017). This will lead to assist in overcoming various
issues and problems related to environment as well as successfully functioning of
business. Development of pitons has caused environmental damage to popular climbing
routes and organisation has stopped development of this product for sustainability of
environment. Emancipation – Patagonia's approaches issues of gender equality at work as well as
provide equal employment of to both men and women. Gender equality is one of the
major issues in successful and effective functioning business. Due to gender inequality
employees are not able to successfully perform organisational task and it have major
impact on functioning of organisation. Patagonia's has 866 women and 862 men
employee. Many of the women are functioning in C level position and it is significant for
motivating and enhancing performance of employees. Through this Patagonia's approach
Equal Pat Pledge issued by White House. This is significant for encouraging American
companies in order to ensure the all employees receive equal pay to all employees who
are working equally. This is effective approach for providing human right as well as
successfully conducting business task (Petrov, Sartory and Filimonov, 2017). It is ethical
responsibility of company as well as significant for full filling the human right by
providing equal opportunities and pay to employees as per their capabilities. Energy – Energy generation is one of the major issues that is faced by company and it
will lead to have major impact on successful performance of company. Patagonia has
invested in solar power in order to reduce the issues of power supply and energy. This is
imitative taken by Patagonia's by following the footsteps of number of corporation such
as Google and Apple. Patagonia's has installed solar panels on 1500 residential rooftops.
Google organisation has invested in solar power on an international level. Apple
company has licence to distribute excess energy generated by its future headquarters solar
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panels. This investments is effective for promotion of nationwide switch to sustainable
energy. Patagonia's has further plan to install communities solar as well as mini solar
power plant for resident of nearby communities.
 Environment protection - Patagonia's environmental and social initiative approach is
significant for conducting different task and activities for providing social activities.
Corporate social responsibility can be describe as the task and practices performed by
company in order to provide more benefits to environment and society (Skomorohov,
Welch and Hein, 2016). It is essential for organisation to conduct effective and efficient
CSR practices in order to develop strong brand image in market. Company is collecting
resources and raw material form society and environment for performing business task so
it is responsibility of company to pay back to society through CSR practices. Patagonia's
has increases CSR trends and it is effective for many insights into sustainable
development for performing business practices at national and international level.
2. When considering environmental and social objectives, what are the interdependencies
between shareholder values and sustainable value that Patagonia needs to consider to
achieve competitive advantage.
It is essential for organisation to identify the interdependencies between shareholder
values and sustainable values that Patagonia need to consider. Shareholder values can be
describe as the values delivered to equity owners of a corporation because of management
capabilities to increase sales, revenues, earning as well as free cash flow. This is significant for
increasing in dividends along with the capital gains for the shareholder. Sustainable values refer
as the ability yo provide values which is significant for organization sustains. This includes
freedom, equality, respect for nature as well as shared responsibility. Interdependencies between
shareholders values and sustainable values is very effective for conducting business task and
practices in more accurate manner as well as gaining competitive edge (Lahén and et.al., 2020).
The major interdependencies between shareholder values and sustainable values that should be
consider by Patagonia are economic social, legal as well as environmental values. All of these
are essential to consider as it will lead to successfully and effectively conduct business task and
gain competitive advantage. Consideration of economical factors which help in improving profits
of company as well as providing more revenues to shareholders. Increase in profits and revenues
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will help in enhancing economic system of nation. Social aspects can be consider as
interdependencies between shareholder values and sustainable values. This includes need and
want of customers, perception of customers, value of product and so on. Consideration of social
aspects will lead to developing better relationship with customers as well as meeting with the
need of customers by providing high quality products. It is crucial to analyse and evaluate social
aspects for successfully enhancing shareholders and sustainable values (Venkatesh, Rai and
Maruping, 2018). Environmental factors are another important interdependencies between
shareholder values and sustainable values which is effective for correctly functioning and
gaining competitive advantage. Environmental factor such as raw material, natural resources,
ecological factor and so on are important for sustainable growth and development of business.
Shareholder value will be enhanced if all environmental aspects are considered by company as
well as all activities are effectively performed. Consideration of environmental factor will assist
shareholder maintain correct and accurate environment that is able to provide required amount of
resources and raw materials. This will help in effective and efficient for meeting with the needs
of business as well as developing high quality products. Maintenance of environment and
protecting it form any type of damage is effective for sustainability of environment along with
this provide long term benefits to shareholders. This will assist organisation to successfully and
correctly perform business task along with enhancing values of shareholder and sustainability in
order to gain competitive advantages. Legal aspects of business is related to all laws and policies
developed by government for functioning of organisation. Through this all shareholder will be
able to gain proper guidance and improve overall performance with the motive of gaining
competitive edge over others.
3. Identify both strategic and operational/practices dimensions involved in implementing
Patagonia's approach in other businesses.
Patagonia is an organisation which was established with mission to build and offer the
best quality goods to customers with having appropriate concern to environment and social
welfare. The company established with the motive of developing and offering solutions to
environmental crises taking place in the world (Adler, 2019). The company also showcased to
society and specially to young generation about how companies and businesses can play a major
role in creating and offering a sustainable society and the world a better place to live and survive.
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With this mission in mind Patagonia offered four approached which it uses while operating and
conducting their business activities. There are number of strategic and operational dimensions
involved in operations of these practices which are relevant if such approaches are used in other
businesses.
The first initiative which Patagonia took was towards sustainability and creativity by
developing Conscious climb approach and developing Chouinard Equipment. This is a eco-
friendly leap which Patagonia took with regards to sustainability. The strategic dimensions
involved is of Risk, company took a huge risk with the motive of providing the best ecologically
balanced solution to society. The operational dimensions involved is of complexed process
through which the equipments are produced. The companies are against Patagonia's approach but
some of the companies have taken initiatives for the same in similar manner but needs better
operative value.
The next approach is of energy which is inspired by other large organisations and leaders
in their field like Apple, Google etc. in which Patagonia installed 1500 solar panel. This
approach is strategically and in operative value is very easy as other businesses are also using it
and Google and Apple have taken initiative and thus it is easily applicable to other businesses
(Müller, Drouin and Sankaran, 2019).
The next practice is known as Emancipation, which is concerned with gender equality at
workplace and in society. In strategical terms companies needs to consider the factor of
discrimination and make changes in their strategies at workplace and bring in strict regulations.
On the other hand in operational terms, other businesses also need to make arrangement like
Patagonia's, where the company developed a family friendly culture, other businesses can take
such initiatives an bring changes. For instance, they can conduct training sessions for spreading
knowledge and changing attributes of people within the company and in the external
environment that is in society.
The last practice is a CSR approach made towards the environment protection in which a
CSR trend is issued addressing the society and other business firms. The company is responsible
for giving back what it is taking form the society and in the same manner other firms are
responsible too (Politsinskaya, Lizunkov and Ergunova, 2019). Thus, strategical and operational
factor involved in it is of challenges given Mihela Hladin and the acceptance made by other
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businesses like Patagonia's. Businesses needs to make changes in operations and they need to
bring better strategies of working in the society for the sake of the world and coming future.
4. Identity the opportunities and challenges which are inherent in addressing the ethics and
sustainability issues within this industry.
There are different challenges and opportunities that are inherent by company through
addressing ethics and sustainability issues. Ethics and sustainability issues can be describe as the
problems that is affecting business to successfully implementing morals and values of business.
It is essential for a company to overcome the challenges and issues which are related to ethics
and sustainability in order to attain various opportunities (Kuramoto and et.al., 2017). Companies
which are dealing in this industry have to face number of challenges and problems while dealing
with the ethics and sustainability issues. It is crucial for company to develop and create more
appropriate strategies which are effective for dealing with issues or challenge of ethics and
sustainability.
Opportunities – Organisation will be able to gain various opportunities by successfully
overcoming sustainability issues. There are various benefits of promoting sustainability and
conducting business task by considering ethics. Through this organisation will be able to
development better image and brand value in market. Consideration of ethics is significant for
enhancing and development strong relationship with customers as well as influencing them
towards company. By overcoming sustainability issues reputation of business will be increase
and it is consider as the promotional tool in order to generate positive publicity of business. It is
ethical responsibility of company to conduct different corporate social responsibility activities in
order to meet with the need of customers. Through corporate social responsibility company is
able to provide various benefits to customers and society. This is useful for gaining opportunity
of market and attracting large number of customers towards business. This helps in increasing
revenues of business and gaining more profits. Overcoming of ethical issues will assist
organisation to maintain positive working environment and improving the performance of
employees. Improvement of performance and capability of employees is opportunity of business
as it will lead to enhance productivity of company as well as gaining competitive advantage over
other rival companies.
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Challenges - Ethical issues will lead to encompass with the large areas of business and it
will lead to affect over ethical standards of business. There are various issues and challenges that
is faced by company while performing business activities through ethics and sustainability
development. The major challenge in resolving ethical and sustainable issues includes
development of effective strategies (Politsinskaya, Lizunkov and Ergunova, 2019). It is very
challenging for company to create and develop strategy that is significant for successfully
performing business task as well as reduce sustainability issues. Organisation needs to evaluate
and analyse the various issues that is affecting business performance and timely completion of
the organisational task. This is challenge for company and it affect over development of effective
business strategies. Difficulty is taking ethical decision is one of the major challenge of company
to successfully enhance sustainability and ethical values (Müller, Drouin and Sankaran, 2019).
There are number of situation or issues in which organisation is not able to determine the most
effective or ethical solution for resolving problems. It is essential for company to determine
different approaches and ways in order to successfully overcome these challenges as well as
conduct business practices ethically.
CONCLUSION
From the above report it can be concluded ethics and sustainability is important for
organisation. Ethics and sustainability is consider as essential part of business and it is supportive
in successful functioning of organisation. Ethics of business is effective for guiding and directing
to perform business operations is such as manner that it does not provide any harm to society or
individuals. There are different approaches and ways that are significant for overcoming with the
issues of ethics in order to enhance business performance. Ethics and sustainability is beneficial
for attracting customers and growth of business.
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