Eco-efficiency and it's Impact

Over the years, as countries and regions around the world began to develop, it slowly became evident that industrialization and economic growth come hand in hand with environmental degradation.^[1] Eco-Efficiency has been proposed as one of the main tools to promote a transformation from unsustainable development to one of sustainable development.^[2] It is based on the concept of creating more goods and services while using fewer resources and creating less waste and pollution. “It is measured as the ratio between the (added) value of what has been produced (eg. GDP) and the (added) environment impacts of the product or service (eg. S02 emissions).” ^[2] The term was coined by the World Business Council for Sustainable Development (WBCSD) in its 1992 publication “Changing Course,” and at the 1992 Earth Summit, eco-efficiency was endorsed as a new business concept and means for companies to implement Agenda 21 in the private sector.^[3] Ergo the term has become synonymous with a management philosophy geared towardssustainability, combing ecological and economic efficiency.^[3]

Eco-efficiency (measures to minimize environmental impact through the reduction or elimination of waste from production processes) has become a goal for companies worldwide, with many realizing significant cost savings from such innovations. Peter Senge and Goran Carstedt see this development as laudable but suggest that simply adopting ecoefficiency innovations could actually worsen environmental stresses in the future. Such innovations reduce production waste but do not alter the number of products manufactured nor the waste generated from their use and discard; indeed, most companies invest in ecoefficiency improvements in order to increase profits and growth. Moreover, there is no guarantee that increased economic growth from ecoefficiency will come in similarly ecoefficient ways, since in today’s global markets, greater profits maybe turned into investment capital that could easily be reinvested in old-style eco-inefficient industries. Even a vastly more ecoefficient industrial system could, were it to grow much larger, generate more total waste and destroy more habitat and species than would a smaller, less ecoefficient economy. Senge and Carstedt argue that to preserve the global environment and sustain economic growth, businesses must develop a new systemic approach that reduces total material use and total accumulated waste. Focusing exclusively on ecoefficiency, which offers a compelling business case according to established thinking, may distract companies from pursuing radically different products and business models.