Corporations Face New Definition of ‘Compliance’

September 4, 2008

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In the past, environmental strategy was about complying with the government’s environmental regulations. Now, companies have no choice but to acquiesce to the environmental standards of customers, end users, employees, and other influencers to get shelf space or mindshare, writes Andrew Winston on Harvard Business Publishing’s blog Leading Green.

Customers are remaking some markets by demanding their own standards. Such as a campaign by Environmental Working Group, which has made more than 600 companies pledge to replace hazardous chemicals in their products.

Retailers, like Wal-Mart, are also requiring suppliers meet the company’s standard in order to get shelf space – demanding phthalate-free toys and that surface coating for toys hold no more than 90 parts per million of lead; that’s 85 percent lower than the federal standard.

Winston suggests companies that don’t want to research and establish their own standards mirror current government programs or use those regulations as guidelines. Verizon recently set energy performance standards for its suppliers – a commercial product version of Energy Star.

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