Key concepts

Environmental Management (EM)
Environmental management is well established both as a research area and as a strategic area for companies. In recent years there has also been an increased focus on environmental assessment of value/supply chains followed by the development of tools for life cycle assessment of products and services and presentation of results in environmental product declarations (EPDs). Hence, environmental management and producer responsibility along the entire value chain are of great significance for companies operating in the global market.

Corporate Social Responsibility (CSR)
Businesses in a global economy now face different expectations regarding the handling of environmental and social responsibilities for their activities. Companies that are involved in large international projects are expected to pay due attention to the environmental and social consequences of their activities in all locations. Moving production overseas reduces the possibilities to control the business operations and may cause certain problems for the company, such as corruption which leads to a bad reputation. Conflicts may also arise when companies cooperate with local partners who run their businesses neglecting generally accepted norms and values.

Companies also have a responsibility related to their products and the documentation of the impact these products as well as their production has on the natural environment, the human health and the society at large along the entire supply chain for these products. The concepts of CSR and eco-efficiency are used to establish the basis for the values, challenges and processes that a firm must take into consideration to minimise the negative consequences of its activities, while maximising value creation with respect to the community and the environment. International consensus and work on these issues is based on the Global Compact, the Millennium Development Goals and the Global Reporting Initiative.

CSR and Small & Medium Enterprises (SMEs)

Global Value Chains (GVC)
The value chain comprises of a range of activities, such as design, marketing and sales, operations, distribution and service, that firms do to bring a product/service to its consumers. These activities can be performed within a single firm or divided among a number of firms within either a single geographic location or different locations. The global value chains (GVCs) are value chains in which the mentioned activities are divided among different firms and spread across a wide range of geographic locations. The firms must be concerned about taking responsibilities for a product throughout its life span.

Supply Chain Management (SCM)
Supply Chain Management is about management and coordination of material, information and monetary flows within and among companies. The supply chain may include component/raw material suppliers, manufacturers, distributors/wholesalers, retailers and customers. Synchronization of operations between them is an important factor for successful SCM. Efforts to create sustainable supply chains are placing increasing focus on products design. Globalization has made supply chain design and management both more physically and managerially complex.

Sustainable Development
The concept of sustainable development rests on the three pillars of social, economic and environmental concerns, or the "triple bottom line". Figure 1 illustrates the progress towards sustainability mainly addressing the environmental challenges. The horizontal axis shows the temporal concerns; the vertical axis illustrates the scope of environmental concern. The different numbered blocks represent different approaches to environmental consciousness. Block 1 represents environmental engineering with a focus on the manufacturing process of a product’s life cycle. Block 2, pollution prevention, also considers the planning phase, while 3, environmentally conscious design and manufacturing, emphasizes the entire life cycle of a product. As we see, block 4, Industrial Ecology, encompasses several products and manufacturers over a long term perspective, and finally 5, sustainable development, has a broad perspective concerning the whole society in a long term perspective that is also multi-generational. The challenge is to move from the lower left corner towards the upper right corner. This challenge is especially important within the domain of globalised production.

Figure 1 - Progress towards sustainability (Fet, 1997, modified after Bras, 1996)

Sustainable development is the unifying paradigm that sets the context for CSR research initiatives.