EMA - Impact on Company's Performance

Ways in which a company’s concern for the environment can impact on its performance:


(a) Short-term savings through waste minimization and energy efficiency schemes can be substantial.

(b) Companies with poor environmental performance may face increased cost of capital because investors and lenders demand a higher risk premium.

(c) There are a number of energy and environmental taxes, such as the UK’s landfill tax.

(d) Pressure group campaigns can cause damage to reputation and/or additional costs.

(e) Environmental legislation may cause the “sunsetting” of products and opportunities for “sunrise” replacement.

(f) The cost of processing input which becomes waste is equivalent to 5-10% of some organization’s revenue.

(g) The phasing out of CFCs has led to markets for alternative products.


(source: BPP Learning Media)



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