Methods of Sustainable Production (Cambridge International IGCSE Business)

Introduction to sustainable production

• Sustainable production occurs when a business produces goods and services in ways that do not harm the environment, society or future generations

  • It focuses on meeting current needs without using up natural resources or causing long-term damage

What sustainable production may involve

Sustainable production may involve using renewable energy, reducing resource use, recycling and reusing resources and developing environmentally friendly products or packaging

• These practices help protect the environment, improve a business’s reputation and may also reduce costs in the long term

Renewable energy

• Renewable energy comes from natural sources that will not run out, like the sun, wind, water and geothermal heat
• These sources are constantly being renewed by nature

How businesses use renewable energy

• Solar panels on buildings to generate electricity
• Wind turbines to produce power, especially for factories or large offices
• Hydroelectric power, if the business is located near rivers or dams
• Geothermal heating for buildings in suitable areas
• Buying green energy from suppliers who use renewable sources

Case Study Renewable Energy Usage at IKEA

Global furniture retailer IKEA has invested heavily in renewable energy

• Installed solar panels on many store rooftops
• Built wind farms in countries including Germany and the USA
• Committed to producing more energy than they use by 2025

Benefits

• Lower energy costs for stores and warehouses
• Improved brand reputation as a sustainable company
• Attracted environmentally conscious customers
• Helped IKEA reach its goal of being climate positive

Reducing resource use

• Reducing resource use means using fewer materials, water and energy when making goods or providing services

• It helps businesses cut waste, lower costs and protect the environment

• Businesses can reduce resource use in the following ways:

  • Designing products that use fewer materials
  • Reusing materials in production instead of using new ones
  • Improving efficiency, like using machines that need less electricity
  • Reducing packaging, or switching to recycled or recyclable packaging
  • Saving water, for example by using water-efficient systems

Reusing and recycling

• Reusing means using items or materials again instead of throwing them away

• Recycling is turning waste materials (like paper, plastic or metal) into new products

• Businesses reuse and recycle in the following ways:

  • Reuse packaging, containers, or leftover materials in production
  • Recycle waste, like paper, plastic, glass, or metal, either in-house or through recycling companies
  • Encourage customers to return used products (e.g. refillable bottles or old electronics)
  • Buy recycled materials to make new products

Case Study Reusing and Recycling at Patagonia

Patagonia, a clothing company, is well-known for its strong environmental focus

• Repairing clothes for customers instead of encouraging new purchases
• Using recycled materials like plastic bottles and old clothes to make new jackets
• Running its Worn Wear programme, where customers return used clothes for reuse or resale

Benefits

• Less waste is sent to landfill
• The business has lower material costs by using recycled inputs
• It has a strong brand image for caring about the environment
• It has developed strong customer loyalty, especially from environmentally conscious buyers

Developing environmentally friendly products

• Environmentally friendly products are designed to have less harm on the planet

  • They use natural or recycled materials
  • They are energy efficient
  • They create less waste or pollution
  • They are biodegradable or reusable

• These products help reduce environmental impact during use and after disposal

• Businesses develop environmentally friendly products in the following ways:

  • Use sustainable materials, like organic cotton or recycled plastic
  • Design products that last longer or are easy to repair
  • Replace harmful chemicals with natural alternatives
  • Offer refillable or reusable versions of existing products

Case Study Lego's Environmentally Friendly Products

Toy company LEGO has replaced replacing oil-based plastic with plant-based plastic made from sugarcane

• Launched eco-friendly LEGO plant pieces (like trees and bushes)
• Invested in research to develop fully sustainable building bricks

Benefits

• Helped reduce use of fossil fuels
• Improved LEGO’s brand image as an eco-conscious company
• Gained positive media coverage and support from parents and schools
• Helped LEGO work towards its goal of making all products sustainable by 2030

Using environmentally friendly packaging

• Environmentally friendly packaging is made from materials that are recycled, recyclable, biodegradable, compostable or reusable

• It is designed to reduce waste and lower harm to the environment

• Businesses develop environmentally friendly packaging in the following ways:

  • Use paper or cardboard instead of plastic
  • Choose biodegradable or compostable bags
  • Offer refillable packaging or reusable containers
  • Use minimal packaging to avoid waste
  • Print with eco-friendly inks or labels

Case Study Environmentally Friendly Packaging at McDonalds

McDonald’s has made major changes to its packaging in many countries in recent years

• Replaced plastic straws with paper ones
• Switched to recyclable paper wrappers and cups
• Stopped using foam packaging
• Started using certified sustainable materials in paper products

Benefits

• Less plastic waste, especially in oceans
• Improved reputation, especially with younger customers
• Helped meet government rules on reducing plastic
• Improved McDonald’s competitiveness with other eco food brands

Exam Hint Use precise examples when explaining sustainability, such as recycling materials or switching to renewable energy. Concrete methods show stronger understanding than vague statements

Advantages and disadvantages of sustainable production

• In 2024, 91% of new renewable energy projects were cheaper than fossil fuels

  • Solar was 41% cheaper and onshore wind 53% cheaper on average
  • These savings helped global businesses save up to $467 billion in fuel costs

• However, sustainable businesses often have a lot of extra work, like checking records and collecting data to make sure they pass regular audits

Evaluation of sustainable production

Greenwashing

• Greenwashing is when a business pretends to be environmentally friendly, but its actions do not match what it claims

  • For example, a company might advertise its products as eco-friendly when, in reality, they are not

• It is a way for businesses to attract customers who care about the environment, without making real changes to how they work

Problems of greenwashing

• Loss of trust

  • If customers find out the business lied, they may stop buying from it
  • Eco-conscious customers may share negative reviews or avoid the brand entirely
  • It can lead to bad publicity and complaints

• Legal trouble

  • In some countries, making false environmental claims can lead to fines or court action