FACTORS AFFECTING GREEN MARKETING

IN INDIA: A STUDY OF METRO CONSUMERS

Dissertation Submitted to the Padmashree Dr. D. Y .Patil

University,
Department of Business Management
in partial fulfillment of the requirements for the award of the
Degree of

MASTER OF PHILOSOPHY
in
BUSINESS MANAGEMENT

Submitted by
ARTEE AGGRAWAL
(Enrollment No. DYPMPHIL076990001)

Research Guide
Dr. R. GOPAL
DIRECTOR, DEAN AND HEAD OF THE DEPARTMENT

PADMASHREE DR. D.Y. PATIL UNIVERSITY, DEPARTMENT

OF BUSINESS MANAGEMENT, Sector 4, Plot No. 10,
CBD Belapur, Navi Mumbai – 400 614

August 2010

I
FACTORS AFFECTING
GREEN MARKETING
IN INDIA:
A STUDY OF METRO
CONSUMERS

II
 DECLARATION

I hereby declare that the Dissertation entitled “Factors Affecting Green

Marketing In India: A Study Of Metro Consumers” submitted for the Award

of Master of Philosophy in Business Management at the Padmashree Dr. D.Y.

Patil University Department of Business Management is my original work and

the thesis has not formed the basis for the award of any degree, associate

ship, fellowship or any other similar titles.

Place:

Date:

Signature of the Guide Signature of the Head of the dept. Signature of

the student

III
 CERTIFICATE

This is to certify that the dissertation entitled “Factors Affecting Green

Marketing In India: A Study Of Metro Consumers” submitted by Ms. Artee

Aggrawal is a bonafide research work for the award of the Doctor of

Philosophy in Business Management at the Padmashree Dr. D. Y. Patil

University Department of Business Management in partial fulfillment of the

requirements for the award of the Degree of Master of Philosophy in

Business Management and that the dissertation has not formed the basis for

the award previously of any degree, diploma, associate ship, fellowship or

any other similar title of any University or Institution.

Also certified that the thesis represents an independent work on the part of

the candidate.

Place:

Date:

Signature of the
Head of the department Signature of the Guide

IV
 ACKNOWLEDGEMENT

In the first place, I am indebted to the Padmashree Dr. D.Y. Patil University

Department of Business Management, which has accepted me for

Doctorate program and provided me with an excellent opportunity to carry out

the present research project.

The research work embodied in this dissertation has been carried out under

the expert guidance and supervision of Dr. R. Gopal, Dean and Director,

Department of Business Management, Padamshree Dr. D. Y. Patil

University. It was only due to his valuable guidance and cheerful enthusiasm

that I was able to complete my research work in a respectable manner. My

profound gratitude and most sincere acknowledgement are extended to him

for his constant encouragement and intellectual insights and also the

constructive criticism that was of immense help from the outset to the finale.

Last but not the least I want to acknowledge the contribution of all those

people who helped me in the one way or the other in compilation of my

dissertation work especially the administrative staff and the library staff at

Department of Business Management, Padamshree Dr. D. Y. Patil University.

Place:

Date: Signature of the student

V
 CONTENTS

CHAPTER NO. TITLE PAGE NO.

List of Tables VIII
List of Figures IX

EXECUTIVE SUMMARY X

1 Introduction to Green 1
Marketing
2 Kyoto-protocol and Clean 17
Development Mechanism

3 Green Marketing: Literature 56

Review

4 Green Marketing: Case 78

Studies
5 Objective of the Study and 105
Research Methodology

6 Profile of the Respondents 114

7 Factors Affecting Green 122

Marketing

8 Summary and Conclusion 146

Bibliography 156
Annexure 164
Questionnaire 168
Repot on Green Marketing 177

VI
 LIST OF TABLES

Table No. Title Page No.

6.1 Age of the Respondents 116

6.2 Qualification of the Respondents 118

6.3 Working Status of the Respondents 119

6.4 Gender of the Respondents 121

7.1 Factor Affecting Green Marketing 125

7.2 Importance of Factors affecting Green 129

Marketing
7.3 Factor Affecting Green Marketing by 132
Age
7.4 Factor Affecting Green Marketing by 135
Qualification
7.5 Factor Affecting Green Marketing by 137
Gender
7.6 Understanding of Consumer for 142
Green product
7.7 Understanding of customers for 144
green symbol

7.8 Awareness of Green products present 145

in the market

VII
 LIST OF FIGURES
Figure No. Title Page No.
2.1 CDM Project cycle 51
3.1 Awareness Stages in Economic 73
Development of Industries

3.2 Stake holders for Go-Green Strategy 74

5.1 Framework for Factors affecting Green 112
Purchasing Behaviour

6.1 Age of the Respondents 117

6.2 Qualification of the Respondents 118
6.3 Working Status of the 120
Respondents
6.4 Gender of the Respondents 121
7.1 Factor Affecting Green Marketing 133
by Age

7.2 Factor Affecting Green Marketing 136

by Qualification

7.3 Factor Affecting Green Marketing 137

by Gender

7.4 Awareness about Eco-certification 139

among consumers

VIII
 EXECUTIVE SUMMARY

The last decade has witnessed a dramatic increase in environmental

consciousness worldwide. One recent survey found that 82 per cent of British

citizens rated the environment as an immediate and urgent problem, while

another study established that 69 per cent of the general public believes that

pollution and other environmental damage are impacting on their everyday

life. The increase in environmental consciousness has had a profound effect

on consumer behaviour, with the green product market expanding at a

remarkable rate. Companies all over the world are striving to reduce the

impact of products and services on the climate and other environmental

parameters. Marketers are taking the cue and are going green.

Green marketing refers to the process of selling products and/or services

based on their environmental benefits. Such a product or service may be

environmentally friendly in it or produced and/ or packaged in an

environmentally friendly way. The obvious assumption of green marketing is

that potential consumers will view a product or service's "greenness" as a

benefit and base their buying decision accordingly.

In order to position green product offerings, companies must first segment the

market according to levels of pro-environmental purchase behaviour and then

target the “greener” consumer segments. However, a review of the literature

IX
indicates that socio-demographic and personality indicators have had only

limited success in profiling consumers according to their proenvironmental

purchasing behaviour. The demand for green products has been shown to be

uneven across different market segments. Thus, “for organizations to position

green products, or communicate their environmental efforts, to members of

the population who are likely to be concerned about environmental issues,

green consumer segments need to be identified”.

This research work aims to illustrate how the ‘green challenge’ is exerting an

influence on current marketing practice and how its implications will require a

more profound shift in the marketing paradigm, if marketers are to continue

delivering customer satisfaction at a profit throughout this new millennium.

The study is empirical in nature and has been designed to find out the

consumer perception of the green products and the factors that affect their

purchasing behaviour for the green products.

OBJECTIVE OF THE RESEARCH

The objective of the present study is –

To determine the factors affecting Green purchasing behaviour among Indian

consumers

To determine most important and least important factors affecting green

purchasing behaviour.

X
To give recommendations and suggestions to increase the uptake of green

products in India.

PROPOSED HYPOTHESIS

The hypothesis framed to test the proposed objectives are-

H10 : Age has no significant relationship with green purchasing behaviour.

H11 : Age has significant relationship with green purchasing behaviour.

H20 : Gender has no significant relationship with green purchasing behaviour.

H21 : Gender has significant relationship with green purchasing behaviour.

H30: Qualification has no significant relationship with green purchasing

behaviour.

H31: Qualification has significant relationship with green purchasing

behaviour.

RESEARCH METHODOLOGY

Development of Questionnaire

The questionnaire was designed by consulting many studies to understand

the various constructs for the designing of the questionnaire and by

conducting a brain storming session on factors affecting Green purchase

behavior in India with 120 students and faculty members of a management

institute. Many factors have been identified such as ecological awareness,

social responsibility towards environment, health awareness,

XI
stressful life, promotion of green products, presence, packaging, eco-

certification etc. Based upon these various factors a framework has been

developed.

Based on the developed framework a questionnaire was designed with 640

questions. Then on the basis of face validity and repeatability, the numbers of

questions were reduced to 150.

The questionnaire was divided into three parts-

 Environmental awareness

 Eco purchasing behaviour

 Demographic profile

A pilot testing was done with these 150 questions and finally an instrument of

43 questions was developed. A five point likart scale was used to collect the

responses. Data has been collected from 695 respondents from various parts

of Mumbai and Navi Mumbai.

DATA ANALYSIS

Data analysis of the filled questionnaire has been done using SPSS. Primarily

a factor analysis was done on the questionnaire to identify the important

factors affecting Green Marketing among Indian Consumers.

Total 11 factors have been identified in the studies that have the egenvalue of

more then 1.

The factors identified are-

XII
 S.No Factors

1 Concern for health and environment

2 Eco buying attitude

3 Social Responsibility

4 Eco certification

5 Social awareness and value

6 Lifestyle

7 Absence of marketing

8 Promotion

9 Brand consciousness

10 Indifferent attitude

11 Packaging

An analysis of mean and standard deviation of these factors showed that

Concern for health and environment was considered as most important factor

by the Indian consumers in green purchasing behaviour, followed by

packaging as the second, Eco-certification as the third, and Lifestyle as the

fourth most important factor while Indifferent attitude is considered as least

important factor, followed by brand consciousness and eco-buying attitude.

The results showed that Gender and Qualification has a significant

relationship with green purchasing behaviour and Age has no significant

relationship with it.

XIII
CONCLUSIONS

Green marketing is still in its infancy in India still this study shows that it is

offering a number of significant benefits to Indian Market:

1. Marketers get access to new markets and gain an advantage over

competitors that are not advocating “greenness.”

2. Marketers can charge a premium on products that are seen as more

eco-responsible.

3. Organizations that adopt green marketing are perceived to be more

socially responsible.

4. Green marketing builds brand equity and wins brand loyalty among

customers.

5. Most customers choose to satisfy their personal needs before caring

for the environment.

6. Overemphasizing greenness rather than customer needs can prove

devastating for a product.

7. Many customers keep away from products labeled “green” because

they see such labeling as a marketing gimmick, and they may lose

trust in an organization that suddenly claims to be green.

8. Green marketers need to find out the value their customers place on

green benefits. It is important that they position the product on the

XIV
 basis of the functional need it caters to and then talk about the

additional benefits of greenness.

9. Marketers need to find out whether, by adopting green marketing, their

organizations will be perceived as more socially responsible. They

need to know whether their customers understand the benefits of

green products and value them enough. If they do not, then the

marketers may also need to invest in customer education in order to

make their marketing efforts successful.

However, Green marketing should not neglect the economic aspect of

marketing. Marketers need to understand the implications of green marketing.

Marketers also have the responsibility to make the consumers understand the

need for and benefits of green products as compared to non-green ones. In

green marketing, consumers are willing to pay more to maintain a cleaner and

greener environment. Finally, consumers, industrial buyers and suppliers

need to pressurize effects on minimize the negative effects on the

environment-friendly. Green marketing assumes even more importance and

relevance in developing countries like India & Pakistan.

XV
 CHAPTER-1

INTRODUCTION TO

GREEN MARKETING

XVI
 CHAPTER-1

INTRODUCTION TO GREEN MARKETING

Beginning of the twenty-first century is witnessing the growing social

and environmental issues as a consequence of increased economic

growth. Increasing levels of greenhouse gasses in the atmosphere, a

hole in the ozone layer caused by CFC releases, widespread destruction

of the rain forests, and a growing list of endangered species and

ecosystems are just a few of the indicators that all is not well. World

Bank (Word Bank Report, 2000) figures showed that nearly half the

world’s population lives on under $2 per day. For this half of the world,

issues of consumer choice and sovereignty or discretionary spending

have little meaning, and promises that the growth in the industrialized

economies would lead to a better quality of life for them have generally

not been fulfilled.

For the new century, the key challenge for mankind is to find more

sustainable and equitable ways to produce consume and live.

Sustainability was once a vision of the future shared by an

environmentally-orientated few. The publication of the Brundtland

Report ‘Our Common Future’ in 1987 brought the issue into the

mainstream. In the wake of the 1992 Rio Earth Summit, the world’s

governments and major corporations have increasingly adopted the

XVII
pursuit of sustainability as a goal. The real challenge lies in turning

these good intentions into meaningful progress in the face of powerful

vested interests, a deeply entrenched and environmentally-hostile

management paradigm, and a global economy with tremendous

momentum on a trajectory which aims towards conventional economic

growth.

Today’s scenario of continuous change in lifestyles and demands of

consumers has raised the concern of the organizations to tap the

market with new strategies. Environmental concern is a new mantra

today to showcase their contribution for environmental awareness and

corporate accountability towards real improvement in environmental

degradation caused by various factors. Organizations success is no

more measured not only by financial performance, but also by their

ecological and social accomplishments. In addition, the current

economic climate has reinforced the need to plan for long-term

sustainability of organization as well as natural resources. The “Triple

Bottom Line” of people, planet and profit is incentivizing companies to

innovate in order to satisfy society and shareholders alike, and to

explore and gauge the potential of newer methods and markets.

For marketing, the challenge is twofold. In the short term, ecological

and social issues have become significant external influences on

companies and the markets within which they operate. Companies have

to react to changing customer needs, new regulations and a new social

XVIII
zeitgeist which reflects increasing concern about the socio-

environmental impacts of business. In the longer term, the pursuit of

sustainability will demand fundamental changes to the management

paradigm which underpins marketing and the other business functions

(Shrivastava, 1994).

Balancing economic interests along with social and environmental

responsibility is referred to as “sustainability,” a growing approach to

business that has led stakeholders to put increased pressure on

companies to optimize their goals and corporate responsibility. Yet the

messages are mixed and quite fuzzy. Shareholders expect from

companies to generate profits, but they also want from these companies

to make a positive contribution towards society through negating

environmental impact. Employees, regulators and, the customers all

want a company to do well in financial and growth term, but they also

want it to “do good.” Innovative organizations that are successful in this

space have explored competitive advantages inherent in embracing

sustainability.

Consumer is ruling the market today and they are exercising their

“vote” with everything they purchase (Ottman, 2006; Polonsky,1994;

Prakash, 2002). By a conscious decision to exchange money for a good

or service, a consumer is validating the importance of that good or

service. Today customers put a lot of emphasis on choosing products

that they believe in on an ethical level. On one level, this might mean,

XIX
say, avoiding clothing stitched by child laborers. For another consumer,

the tipping point might be the way the company treats the environment

in their design, testing, and production processes.

Successful businesses have realized that at the end of the day a

business is going to be assessed by its profits as well as contribution to

human potential and harmony with other resources, both natural and

artificial. However, Selling environment-friendly products is almost as

difficult as cleaning it up. It entails much more than a new package,

using recycled material instead of virgin ones and natural and organic

ingredients instead of artificial ones. Marketers have historically faced

an uphill battle when it comes to marketing eco-friendly goods. Simply

put, it is difficult to influence consumer purchase behavior without first

impacting attitudes and values (Thogersen and Olander, 2002). These

values, however, take a concerted effort over a long period of time to

change.

More than 12 other studies in the US, Brazil, Europe, Mexico, South

Korea and Taiwan have established links between air pollutants and low

birth weight premature birth still birth and infant death. Thus the

growing awareness among the consumers all over the world regarding

protection of the environment in which they live, People do want to

bequeath a clean earth to their offspring. Various studies by

environmentalists indicate that people are concerned about the

environment and are changing their behavior pattern so as to be less

XX
hostile towards it. Now we see that most of the consumers, both

individual and industrial, are becoming more concerned about

environment-friendly products. Most of them feel that environment-

friendly products are safe to use. Worldwide evidence indicates people

are concerned about the environment and are changing their behavior.

As a result of this, green marketing has emerged which speaks for

growing market for sustainable and socially responsible products and

services. As resources are limited and human wants are unlimited, it is

important for the marketers to utilize the resources efficiently without

waste as well as to achieve the organization's objective.

GREEN MARKETING

Green marketing is the process of developing products and services

and promoting them to satisfy the customers who prefer products of

good quality, performance and convenience at affordable cost, which at

the same time do not have a detrimental impact on the environment. It

includes a broad range of activities like product modification, changing

the production process, modified advertising, change in packaging, etc.,

aimed at reducing the detrimental impact of products and their

consumption and disposal on the environment.

Green marketing refers to the process of selling products and/or

services based on their environmental benefits. Such a product or

service may be environmentally friendly in it or produced and/or

packaged in an environmentally friendly way. The obvious assumption

XXI
of green marketing is that potential consumers will view a product or

service's "greenness" as a benefit and base their buying decision

accordingly. Companies all over the world are striving to reduce the

impact of products and services on the climate and other environmental

parameters. Marketers are taking the cue and are going green.

Green marketing offers business bottom line incentives and top line

growth possibilities. While modification of business or production

processes may involve start-up costs, it will save money in the long

term. For example the cost of installing solar energy is an investment in

future energy cost savings. Companies that develop new and improved

products and services with environmental impacts in mind give

themselves access to new markets, substantially increase profits and

enjoy competitive advantages over those marketing non-

environmentally responsible alternatives.

According to a recent study for North America, Eco Markets 2009 (Kate

Rusnak, 2009), respondents attributed some importance to all of the

purchasing factors indicated in the survey, price and performance were

ranked as most important in a list chat also included environmental and

social considerations. Comparing "green" packaging products against

traditionally used containers, bags and sacks revealed that slightly

more purchasers believe that green packaging costs more while 30%

see it as costing the same. Throughout the Eco Markets study, findings

suggest there is plenty of room for green product growth in the

XXII
marketplace. When it comes to selecting green products, eco-labels can

increase trust and confidence in green products.

However, Selling environment-friendly products is almost as difficult as

cleaning it up. It entails much more than a new package, using recycled

material instead of virgin ones and natural and organic ingredients

instead of artificial ones. Marketers have historically faced an uphill

battle when it comes to marketing eco-friendly goods. Simply put, it is

difficult to influence consumer purchase behavior without first

impacting attitudes and values (Thogersen and Olander, 2002). These

values, however, take a concerted effort over a long period of time to

change.

GREEN MARKETING: DEFINITION

Most of the definitions of ‘Green Marketing’ are focused on

environmental friendliness and offering product to customers by

labeling Green. The consumer perspective is highly neglected (Ottman,

Stanford and Hartman, 2006). Ottman et all (2006) related the reasons in

developed countries to efficiency and cost effectiveness, health and

safety, performance, symbolism, convenience and bundling. Some

studies from South Asia (Kaman Lee, 2008) showed that social influence

was the top predictor of Hong Kong adolescents’ green purchasing

behaviour, followed by environmental concern as the second, concern

for self-image in environmental protection as the third, and perceived

environmental responsibility as the fourth top predictor.

XXIII
From developing countries’ perspective the most important aspect to be

considered primarily is creation of awareness among consumers and

creating cost effective technologies which involves not only a stake

from producers and consumers but also the role of state is very crucial.

PROPOSED DEFINITION FOR THE STUDY

“Green Marketing is an art of creating awareness among consumers

about carefully planned and developed eco compliance products and

services using competitive pricing, promotion and distribution

strategies that lead to increased uptake of product and services

increase in ROI and finally consumer satisfaction”.

Green Marketing encompasses:

 Being Green or using eco-friendly technology in various process of

manufacturing and

 Spreading Green ie. Creating awareness among consumers for high

uptake of green products.

While more and more companies are focusing on Being Green less

attention has been paid on spreading green and since attitude and

perceptions are socially constructed it cannot develop without focusing

efforts on creating awareness for eco-friendly technology.

All types of consumers, both individual and industrial are becoming

more concerned and aware about the natural environment. In a 1992

study of 16 countries, more than 50% of consumers in each country,

XXIV
other than Singapore, indicated they were concerned about the

environment. A 1994 study in Australia found that 84.6% of the sample

believed all individuals had a responsibility to care for the environment.

A further 80% of this sample indicated that they had modified their

behavior, including their purchasing behavior, due to environmental

reasons. As demands change, many firms see these changes as an

opportunity to be exploited. It can be assumed that firms marketing

goods with environmental characteristics will have a competitive

advantage over firms marketing non-environmentally responsible

alternatives.

There are numerous examples of firms who have strived to become

more environmentally responsible, in an attempt to better satisfy their

consumer need. McDonald's replaced its clam shell packaging with

waxed paper because of increased consumer concern relating to

polystyrene production and Ozone depletion. Xerox introduced a "high

quality" recycled photocopier paper in an attempt to satisfy the

demands of firms for less environmentally harmful products. This is not

to imply that all firms who have undertaken environmental marketing

activities actually improve their behavior. In some cases firms have

misled consumers in an attempt to gain market share. In other cases

firms have jumped on the green bandwagon without considering the

accuracy of their behavior, their claims, or the effectiveness of their

XXV
products. This lack of consideration of the true "greenness" of activities

may result in firms making false or misleading green marketing claims.

INDIA: NEED FOR GREEN MARKETING

India is world’s 2nd largest populated country and the natural resources

are under tremendous pressure and therefore there is an urgent need to

pay attention for a right balance between consumption with

conservation of natural resources. This paper reviews the existing

literature on Green Marketing and proposes the role of different

stakeholders in ‘Green marketing strategy’. Further it examine the

various factors hampering the uptake of Green products in India and

highlight the need of creating consumer awareness and extensive use

of cleantech (environmental friendly technology) to address green

myopia in India.

India is currently facing the challenge of degraded environment and is

paying heavy health and economic price for it (Nagdeve, 2002). After

Copenhagen, Indian market is swamped with commodities claming to

be green. State has declared subsidies on the production of green

products and for complying with the CDM norms to reduce carbon

prints. Corporate world has also geared up to encash the profits coming

from claming green from state as well as consumers.

Market is trying to pull the consumers who are exercising their “vote”

with everything they purchase (Ottman et all, 2006; Polonsky,1994;

Prakash, 2002) by putting a lot of emphasis on choosing products that

XXVI
they believe in on an ethical level. Despite all efforts put forth by

companies to sell the products with green labels, the uptake of the

green products in Indian market is still near to the ground (Aggrawal et

all, 2010). Consumer perception for GREEN is still unclear (Chris Ely,

2010). Studies from the developed countries reported 90 percent of

consumer’s familiarity with terms like ‘recycling’, ‘energy efficiency’,

‘organic’ and ‘global warming’ and consumers purchase

environmentally friendly products, even if that means paying a higher

price (Hume 1997; Miller 1993). Having addressed consumer behaviour

and behaviour related to green concepts and activities, one of the

biggest questions facing the industry is how environmental awareness

and concerns translate when it comes time to buy. The demand for

green products has been shown to be uneven across different market

segments (Ottman, 1992; Peattie, 1992). Thus, “For organizations to

position green products, or communicate their environmental efforts, to

members of the population who are likely to be concerned about

environmental issues, green consumer segments need to be identified”

(Bohlen et al., 1993, p. 415). There is an ‘attitude-behaviour gap' where

30% of consumers report that they are very concerned about

environmental issues but they are struggling to translate this into

purchases (Young, Hwang & Caroline J Oates, 2010). This gap is even

larger in emerging economies like India. Realizing this gap the present

XXVII
study has been designed to understand the factors affecting the green

purchasing behaviour in India.

This research work aims to illustrate how the ‘green challenge’ is

exerting an influence on current marketing practice and how its

implications will require a more profound shift in the marketing

paradigm, if marketers are to continue delivering customer satisfaction

at a profit throughout this new millennium. Green marketing subsumes

greening products as well as greening firms. In addition to manipulating

the 4Ps (product, price, place and promotion) of the traditional

marketing mix, it requires a careful understanding of public policy

processes. Green marketing also ties closely with issues of industrial

ecology and environmental sustainability such as extended producers’

liability, life-cycle analysis, material use and resource flows, and eco-

efficiency. Thus, the subject of green marketing is vast, having

important implications for business strategy and public policy. Firms

can ‘green’ themselves in three ways: value-addition processes (firm

level), management systems (firm level) and/or products (product level).

Firms could also adopt management systems that create conditions for

reducing the environmental impact of value-addition processes. By

having measurable (therefore, easily monitored and understood)

performance indicators, firms can make verifiable claims about the

environmental impact of their management systems. The third greening

strategy pertains to products. This could take place in the following

XXVIII
ways: (i) repair (ii) recondition iii) remanufacture (iv) reuse (v) recycle

and (vi) reduce.

The work would focus primarily on the above issues and strategies for

promoting products by employing claims about their environmental

attributes or about firms that manufacture and/or sell them. Secondarily,

it would focus on studying product and pricing issues.

XXIX
 CHAPTER-2

KYOTO PROTOCAL

AND CLEAN

DEVELOPMENT

MECHANISM

XXX
 CHAPTER-2

KYOTO PROTOCAL AND CLEAN

DEVELOPMENT MECHANISM (CDM)

Environmental technology or green technology or clean technology

(abbreviated as cleantech) is the application of the environmental

science to conserve the natural environment and resources, and to curb

the negative impacts of human involvement. Sustainable development

is the core of environmental technologies. When applying sustainable

development as a solution for environmental issues, the solutions need

to be socially equitable, economically viable, and environmentally

sound.

The technologies include, but are not limited to, the following areas:

 Recycling

 Water Purification

 Sewage Treatment

 Environmental remediation

 Solid Waste Management

 Renewable Energy

Management theory in general is firmly rooted in an economic and

technical systems perspective which concentrates on exchanges,

XXXI
products, production and profits. Over time it has evolved to become

more ‘human’, with the emergence of disciplines like organizational

behaviour, human resource management, business ethics and societal

marketing. The fact that businesses are physical systems which exist

within a finite and vulnerable physical environment has, until recently,

largely been ignored as a management and marketing issue. During the

1990s, the marketing discipline began to seriously discuss the physical

implications and sustainability of marketing (e.g. O’Hara, 1995; van Dam

and Apeldoorn, 1996).

The first United Nations Conference on the Human Environment

(UNCHE) was held in Stockholm, Sweden from June 5 to June 16, 1972.

Representatives from 113 countries were present, as well as

representatives from many international non-governmental

organizations, intergovernmental organizations, and many other

specialized agencies. This was the first United Nations conference on

the environment as well as the first major international gathering

focused on human activities in relationship to the environment, and it

laid the foundation for environmental action at an international level.

The conference acknowledged that the goal of reducing human impact

on the environment would require extensive international cooperation,

as many of the problems affecting the environment are global in nature.

Following this conference, the United Nations Environmental

XXXII
Programme (UNEP) was launched in order to encourage United Nations

agencies to integrate environmental measures into their programs.

The UNCHE emphasized that defending and improving the environment

must become a goal to be pursued by all countries. The Stockholm

Declaration and Action Plan defined principles for the preservation and

enhancement of the natural environment, and highlighted the need to

support people in this process. The Conference indicated that

“industrialized” environmental problems, such as habitat degradation,

toxicity andacid rain , were not necessarily relevant issues for all

countries. In particular, development strategies were not meeting the

needs of the poorest countries and communities.

Some of the specific issues addressed were the role which

industrialized countries should have in the process of protecting the

environment, stating that industrial countries should help to close the

gap between them and underdeveloped countries while keeping their

own priorities and the protection and improvement of the environment

in mind. The conference developed a long set of recommendations to

act as goals to pursue its mission. Recommendations included that

governments communicate about environmental issues that have

international implications (such as air pollution), that governments give

attention to the training of those who plan, develop, and manage

settlement areas, and that agencies work together to address many

issues, such as access to clean water and population growth. However,

XXXIII
it was the pending environmental problems that dominated the meeting

and led to wider public environmental awareness.

United Nations Environment Program: One of the greatest achievements

of the UNCHE was the creation of the United Nations Environment

Program (UNEP), based in Nairobi, Kenya. The mission of UNEP is "to

provide leadership and encourage partnership in caring for the

environment by inspiring, informing, and enabling nations and peoples

to improve their quality of life without compromising that of future

generations." UNEP is the voice for the environment within the United

Nations system and works toward this mission by:

 Encouraging international participation and cooperation in

addressing environmental issues and environmental policy

 Monitoring the status of the global environment and interpreting

environmental data collected

 Creating environmental awareness in governments, society, and the

private sector

 Coordinating UN activities pertaining to the environment

 Developing regional programs for sustainability

 Helping environmental authorities, especially those in developing

countries, form and implement policy

 Helping to develop international environmental law

XXXIV
Carbon Footprint

A carbon footprint is "the total set of greenhouse gases (GHG)

emissions caused by an organization, event or product". For simplicity

of reporting, it is often expressed in terms of the amount of carbon

dioxide, or its equivalent of other GHGs, emitted.

The concept name of the carbon footprint originates from ecological

footprint discussion. The carbon footprint is a subset of the ecological

footprint and of the more comprehensive Life Cycle Assessment (LCA).

An individual, nation, or organization's carbon footprint can be

measured by undertaking a GHG emissions assessment. Once the size

of a carbon footprint is known, a strategy can be devised to reduce it,

e.g. by technological developments, better process and product

management, changed Green Public or Private Procurement (GPP),

Carbon capture, consumption strategies, and others.

The mitigation of carbon footprints through the development of

alternative projects, such as solar or wind energy or reforestation,

represents one way of reducing a carbon footprint and is often known

as Carbon offsetting.

The United Nations Framework Convention on

Climate Change

The United Nations Framework Convention on Climate

Change (UNFCCC or FCCC) is an international environmental treaty

XXXV
produced at the United Nations Conference on Environment and

Development (UNCED), informally known as the Earth Summit, held in

Rio de Janeiro from 3 to 14 June 1992. The objective of the treaty is to

stabilize greenhouse gas concentrations in the atmosphere at a level

that would prevent dangerous anthropogenic interference with the

climate system.

The treaty itself sets no mandatory limits on greenhouse gas emissions

for individual countries and contains no enforcement mechanisms. In

that sense, the treaty is considered legally non-binding. Instead, the

treaty provides for updates (called "protocols") that would set

mandatory emission limits. The principal update is the Kyoto

Protocol, which has become much better known than the UNFCCC
itself.

The UNFCCC was opened for signature on May 9, 1992, after an

Intergovernmental Negotiating Committee produced the text of the

Framework Convention as a report following its meeting in New York

from 30 April to 9 May 1992. It entered into force on March 21, 1994. As

of December 2009, UNFCCC had 192 parties.

One of its first tasks was to establish national greenhouse gas

inventories of greenhouse gas (GHG) emissions and removals, which

were used to create the 1990 benchmark levels for accession of Annex I

countries to the Kyoto Protocol and for the commitment of those

XXXVI
countries to GHG reductions. Updated inventories must be regularly

submitted by Annex I countries.

The UNFCCC is also the name of the United Nations Secretariat charged

with supporting the operation of the Convention, with offices in Haus

Carstanjen, Bonn, Germany. From 2006 to 2010 the head of the

secretariat was Yvo de Boer; on May 17, 2010 his successor, Christiana

Figures from Costa Rica has been named. The Secretariat, augmented

through the parallel efforts of the Intergovernmental Panel on Climate

Change (IPCC), aims to gain consensus through meetings and the

discussion of various strategies.

The parties to the convention have met annually from 1995 in

Conferences of the Parties (COP) to assess progress in dealing with

climate change. In 1997, the Kyoto Protocolwas concluded and

established legally binding obligations for developed countries to

reduce their greenhouse gas emissions.

Annex I, Annex II countries and developing

countries

Parties to UNFCCC are classified as:

Annex I countries - industrialized countries and economies in transition

Annex II countries - developed countries which pay for costs of

developing countries

Developing countries.

XXXVII
Annex I countries which have ratified the Protocol have committed to

reduce their emission levels of greenhouse gasses to targets that are

mainly set below their 1990 levels. They may do this by allocating

reduced annual allowances to the major operators within their borders.

These operators can only exceed their allocations if they buy emission

allowances, or offset their excesses through a mechanism that is

agreed by all the parties to UNFCCC.

Annex II countries are a sub-group of the Annex I countries. They

comprise the OECD members, excluding those that were economies in

transition in 1992.

Developing countries are not required to reduce emission levels unless

developed countries supply enough funding and technology. Setting no

immediate restrictions under UNFCCC serves three purposes:

 It avoids restrictions on their development, because emissions are

strongly linked to industrial capacity

 They can sell emissions credits to nations whose operators have

difficulty meeting their emissions targets

 They get money and technologies for low-carbon investments from

Annex II countries.

 Developing countries may volunteer to become Annex I countries

when they are sufficiently developed.

XXXVIII
Some opponents of the Convention argue that the split between Annex I

and developing countries is unfair, and that both developing countries

and developed countries need to reduce their emissions unilaterally.

Some countries claim that their costs of following the Convention

requirements will stress their economy. This was one reason given by

George W. Bush, then President of the United States, for not forwarding

the Kyoto Protocol to the United States Senate for ratification. Other

countries point to research, such as the Stern Report, that calculates

the cost of compliance to be less than the cost of the consequences of

doing nothing.

Annex I countries

There are 40 Annex I countries and the European Union is also a

member. These countries are classified as industrialized countries and

countries in transition:

Australia, Austria, Belarus, Belgium, Bulgaria, Canada, Croatia, CzechR

epublic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary,

Iceland, Ireland, Italy, Japan,Latvia, Liechtenstein, Lithuania, Luxembour

g, Monaco, Netherlands, New

Zealand, Norway, Poland, Portugal, Romania, Russian

Federation, Slovakia, Slovenia, Spain, Sweden,Switzerland, Turkey, Ukra

ine, United Kingdom, United States of America

Annex II countries

XXXIX
There are 23 Annex II countries and the European Union. Turkey was

removed from the Annex II list in 2001 at its request to recognize its

economy as a transition economy. These countries are classified as

developed countries which pay for costs of developing countries:

Australia, Austria, Belgium, Canada, Denmark, Finland, France, German

y, Greece, Iceland, Ireland, Italy, Japan, Luxembourg, Netherlands, New

Zealand, Norway, Portugal, Spain,Sweden, Switzerland, United

Kingdom, United States of America

U.N. Framework Convention on Climate Change

(UNFCCC)

The United Nations Framework Convention on Climate Change

(UNFCCC) was opened for signature at the 1992 United Nations

Conference on Environment and Development(UNCED) in Rio de

Janeiro (known by its popular title, the Earth Summit). On June 12, 1992,

154 nations signed the UNFCCC that upon ratification committed

signatories' governments to a voluntary "non-binding aim" to reduce

atmospheric concentrations of greenhouse gases with the goal of

"preventing dangerous anthropogenic interference with Earth's climate

system." These actions were aimed primarily at industrialized countries,

with the intention of stabilizing their emissions of greenhouse gases at

1990 levels by the year 2000; and other responsibilities would be

incumbent upon all UNFCCC parties. The parties agreed in general that

XL
they would recognize "common but differentiated responsibilities," with

greater responsibility for reducing greenhouse gas emissions in the

near term on the part of developed/industrialized countries, which were

listed and identified in Annex I of the UNFCCC and thereafter referred to

as "Annex I" countries.

On September 8, 1992, the US president George Bush transmitted the

UNFCCC for advice and consent of the U.S. Senate to ratification. The

Foreign Relations Committee approved the treaty and reported it

(Senate Exec. Rept. 102-55) October 1, 1992. The Senate consented to

ratification on October 7, 1992, with a two-thirds majority vote. President

Bush signed the instrument of ratification October 13, 1992, and

deposited it with the U.N. Secretary General.

According to terms of the UNFCCC, having received over 50 countries'

instruments of ratification, it entered into force March 21, 1994.

Benchmarking

In the context of the UNFCCC, benchmarking is the setting of emission

reduction commitments measured against a particular base year. The

only quantified target set in the original FCCC was for developed

countries to reduce their greenhouse gas emissions to 1990 levels by

the year 2000 (Goldemberg et al., 1996, pp. 32–33). There are issues with

benchmarking that can make it potentially inequitable (Goldemberg et

al., 1996, pp. 32–33). For example, take two countries that have identical

XLI
emission reduction commitments as measured against the 1990 base

year. This might be interpreted as being equitable, but this is not

necessarily the case. One country might have previously made efforts

to improve energy efficiency in the years preceding the benchmark year,

while the other country had not. In economic terms, the marginal cost

curve for emissions reductions rises steeply beyond a certain point.

Thus, to meet its emission reduction commitment, the country with

initially high energy efficiency might face high costs. But for the country

that had previously encouraged overconsumption of energy, e.g.,

through subsidies, the costs of meeting its commitment would

potentially be lower.

Precautionary principle

In decision making, the precautionary principle is considered when

possibly dangerous, irreversible, or catastrophic events are identified,

but scientific evaluation of the potential damage is not sufficiently

certain (Toth et al., 2001, pp. 655–656). The precautionary principle

implies an emphasis on the need to prevent such adverse effects.

Uncertainty is associated with each link of the causal chain of climate

change. For example, future GHG emissions are uncertain, as are

climate change damages. However, following the precautionary

principle, uncertainty is not a reason for inaction, and this is

acknowledged in Article 3.3 of the UNFCCC (Toth et al., 2001, p. 656).

XLII
Conferences of the Parties

Since the UNFCCC entered into force, the parties have been meeting

annually in Conferences of the Parties (COP) to assess progress in

dealing with climate change, and beginning in the mid-1990s, to

negotiate the Kyoto Protocol to establish legally binding obligations for

developed countries to reduce their greenhouse gas emissions. From

2005 the Conferences have met in conjunction with Meetings of Parties

of the Kyoto Protocol (MOP), and parties to the Convention that are not

parties to the Protocol can participate in Protocol-related meetings as

observers.

1995 - COP 1, The Berlin Mandate

The first UNFCCC Conference of Parties took place in March 1995 in

Berlin, Germany. It voiced concerns about the adequacy of countries'

abilities to meet commitments under the Convention. These were

expressed in a U.N. ministerial declaration known as the "Berlin

Mandate", which established a 2-year Analytical and Assessment Phase

(AAP), to negotiate a "comprehensive menu of actions" for countries to

pick from and choose future options to address climate change which

for them, individually, made the best economic and environmental

sense. The Berlin Mandate exempted non-Annex I countries from

additional binding obligations, in keeping with the principle of "common

XLIII
but differentiated responsibilities" established in the UNFCCC even

though, collectively, the larger, newly industrializing countries were

expected to be the world's largest emitters of greenhouse gas

emissions 15 years hence. In order to monitor the implementation of the

Convention, COP1 also established two permanent subsidiary bodies:

the Subsidiary Body for Scientific and Technological Advice (SBSTA)

and the Subsidiary Body for Implementation (SBI).

1996 - COP 2, Geneva, Switzerland

COP 2 took place in July 1996 in Geneva, Switzerland. Its Ministerial

Declaration was noted (but not adopted) July 18, 1996, and reflected a

U.S. position statement presented by Timothy Wirth, former Under

Secretary for Global Affairs for the U.S. State Department at that

meeting, which Accepted the scientific findings on climate change

proffered by the Intergovernmental Panel on Climate Change (IPCC) in

its second assessment (1995); Rejected uniform "harmonized policies"

in favor of flexibility; Called for "legally binding mid-term targets."

1997 - COP 3, The Kyoto Protocol on Climate

Change

COP 3 took place in December 1997 in Kyoto, Japan. After intensive

negotiations, it adopted the Kyoto Protocol, which outlined the

greenhouse gas emissions reduction obligation for Annex I countries,

along with what came to be known as Kyoto mechanisms such as

XLIV
emissions trading, clean development mechanism and joint

implementation. Most industrialized countries and some central

European economies in transition (all defined as Annex B countries)

agreed to legally binding reductions in greenhouse gas emissions of an

average of 6 to 8% below 1990 levels between the years 2008-2012,

defined as the first emissions budget period. The United States would

be required to reduce its total emissions an average of 7% below 1990

levels; however neither the Clinton administration nor the Bush

administration sent the protocol to Congress for ratification. The Bush

administration explicitly rejected the protocol in 2001.

1998 - COP 4, Buenos Aires, Argentina

COP 4 took place in November 1998 in Buenos Aires. It had been

expected that the remaining issues unresolved in Kyoto would be

finalized at this meeting. However, the complexity and difficulty of

finding agreement on these issues proved insurmountable, and instead

the parties adopted a 2-year "Plan of Action" to advance efforts and to

devise mechanisms for implementing the Kyoto Protocol, to be

completed by 2000. During COP4, Argentina and Kazakhstan expressed

their commitment to take on the greenhouse gas emissions reduction

obligation, the first two non-Annex countries to do so.

1999 - COP 5, Bonn, Germany

XLV
COP 5 took place between October 25 and November 5, 1999, in Bonn,

Germany. It was primarily a technical meeting, and did not reach major

conclusions.

2000 - COP 6, The Hague, Netherlands

COP 6 took place between November 13-November 25, 2000, in The

Hague, Netherlands. The discussions evolved rapidly into a high-level

negotiation over the major political issues. These included major

controversy over the United States' proposal to allow credit for carbon

"sinks" in forests and agricultural lands, satisfying a major proportion

of the U.S. emissions reductions in this way; disagreements over

consequences for non-compliance by countries that did not meet their

emission reduction targets; and difficulties in resolving how developing

countries could obtain financial assistance to deal with adverse effects

of climate change and meet their obligations to plan for measuring and

possibly reducing greenhouse gas emissions. In the final hours of COP

6, despite some compromises agreed between the United States and

some EU countries, notably the United Kingdom, the EU countries as a

whole, led by Denmark and Germany, rejected the compromise

positions, and the talks in The Hague collapsed. Jan Pronk, the

President of COP 6, suspended COP-6 without agreement, with the

expectation that negotiations would later resume . It was later

announced that the COP 6 meetings (termed "COP 6 bis") would be

resumed in Bonn, Germany, in the second half of July. The next

XLVI
regularly scheduled meeting of the parties to the UNFCCC - COP 7 - had

been set for Marrakech, Morocco, in October-November 2001.

2001 - COP 6, Bonn, Germany

COP 6 negotiations resumed July 17–27, 2001, in Bonn, Germany, with

little progress having been made in resolving the differences that had

produced an impasse in The Hague. However, this meeting took place

after George W. Bush had become the President of the United States

and had rejected the Kyoto Protocol in March 2001; as a result the

United States delegation to this meeting declined to participate in the

negotiations related to the Protocol and chose to take the role of

observer at the meeting. As the other parties negotiated the key issues,

agreement was reached on most of the major political issues, to the

surprise of most observers, given the low expectations that preceded

the meeting. The agreements included:

Flexible Mechanisms: The "flexibility" mechanisms which the United

States had strongly favored when the Protocol was initially put together,

including emissions trading; Joint Implementation (JI); and the Clean

Development Mechanism (CDM) which allow industrialized countries to

fund emissions reduction activities in developing countries as an

alternative to domestic emission reductions. One of the key elements of

this agreement was that there would be no quantitative limit on the

credit a country could claim from use of these mechanisms provided

XLVII
domestic action constituted a significant element of the efforts of each

Annex B country to meet their targets.

Carbon sinks: It was agreed that credit would be granted for broad

activities that absorb carbon from the atmosphere or store it, including

forest and cropland management, and re-vegetation, with no over-all

cap on the amount of credit that a country could claim for sinks

activities. In the case of forest management, an Appendix Z establishes

country-specific caps for each Annex I country. Thus, a cap of 13 million

tons could be credited to Japan (which represents about 4% of its base-

year emissions). For cropland management, countries could receive

credit only for carbon sequestration increases above 1990 levels.

Compliance: Final action on compliance procedures and mechanisms

that would address non-compliance with Protocol provisions was

deferred to COP 7, but included broad outlines of consequences for

failing to meet emissions targets that would include a requirement to

"make up" shortfalls at 1.3 tons to 1, suspension of the right to sell

credits for surplus emissions reductions, and a required compliance

action plan for those not meeting their targets.

Financing: There was agreement on the establishment of three new

funds to provide assistance for needs associated with climate change:

(1) a fund for climate change that supports a series of climate

measures; (2) a least-developed-country fund to support National

XLVIII
Adaptation Programs of Action; and (3) a Kyoto Protocol adaptation

fund supported by a CDM levy and voluntary contributions.

A number of operational details attendant upon these decisions

remained to be negotiated and agreed upon, and these were the major

issues considered by the COP 7 meeting that followed.

2001 - COP 7, Marrakech, Morocco

At the COP 7 meeting in Marrakech, Morocco from 29 October to 10

November 2001, negotiators wrapped up the work on the Buenos Aires

Plan of Action, finalizing most of the operational details and setting the

stage for nations to ratify the Kyoto Protocol.deadlink deadlink The

completed package of decisions is known as the Marrakech Accords.

The United States delegation maintained its observer role, declining to

participate actively in the negotiations. Other parties continued to

express hope that the United States would re-engage in the process at

some point and worked to achieve ratification of the Kyoto Protocol by

the requisite number of countries to bring it into force (55 countries

needed to ratify it, including those accounting for 55% of developed-

country emissions of carbon dioxide in 1990). The date of the World

Summit on Sustainable Development (August-September 2002) was put

forward as a target to bring the Kyoto Protocol into force. The World

Summit on Sustainable Development (WSSD) was to be held in

Johannesburg, South Africa. The main decisions at COP 7 included:

XLIX
Operational rules for international emissions trading among parties to

the Protocol and for the CDM and joint implementation;

A compliance regime that outlined consequences for failure to meet

emissions targets but deferred to the parties to the Protocol, once it

came into force, the decision on whether those consequences would be

legally binding;

Accounting procedures for the flexibility mechanisms;

A decision to consider at COP 8 how to achieve a review of the

adequacy of commitments that might lead to discussions on future

commitments by developing countries.

2002 - COP 8, New Delhi, India

Taking place from October 23 – November 1, 2002, COP8 adopted the

Delhi Ministerial Declaration that, amongst others, called for efforts by

developed countries to transfer technology and minimize the impact of

climate change on developing countries.

2003 - COP 9, Milan, Italy

1 – 12 December 2003 The parties agreed to use the Adaptation Fund

established at COP7 in 2001 primarily in supporting developing

countries better adapt to climate change. The fund would also be used

for capacity-building through technology transfer. At COP9, the parties

also agreed to review the first national reports submitted by 110 non-

Annex I countries.

L
2004 - COP 10, Buenos Aires, Argentina

6 – 17 December 2004. See also Climate ethics: The Program on the

Ethical Dimensions of Climate Change COP10 discussed the progress

made since the first Conference of the Parties 10 years ago and its

future challenges, with special emphasis on climate change mitigation

and adaptation. To promote developing countries better adapt to climate

change, the Buenos Aires Plan of Action was adopted. The parties also

began discussing the post-Kyoto mechanism, on how to allocate

emission reduction obligation following 2012, when the first

commitment period ends.

2005 - COP 11/MOP 1, Montreal, Canada

COP 11 (or COP 11/MOP 1) took place between November 28 and

December 9, 2005, in Montreal, Quebec, Canada. COP 11 was also the

first Meeting of the Parties (MOP-1) to the Kyoto Protocol since their

initial meeting in Kyoto in 1997. It was therefore one of the largest

intergovernmental conferences on climate change ever. The event

marked the entry into force of the Kyoto Protocol. Hosting more than

10,000 delegates, it was one of Canada's largest international events

ever and the largest gathering in Montreal since Expo 67. The Montreal

Action Plan is an agreement hammered out at the end of the conference

to "extend the life of the Kyoto Protocol beyond its 2012 expiration date

and negotiate deeper cuts in greenhouse-gas emissions." dead

LI
link Canada's environment minister, at the time,Stéphane Dion, said the

agreement provides a "map for the future."[5]

2006 - COP 12/MOP 2, Nairobi, Kenya

COP 12/MOP 2 took place between 6 and 17 November 2006 in Nairobi,

Kenya. At the meeting, BBC reporter Richard Black coined the phrase

“climate tourists” to describe some delegates who attended “to see

Africa, take snaps of the wildlife, the poor, dying African children and

women”. Black also noted that due to delegates concerns over

economic costs and possible losses of competitiveness, the majority of

the discussions avoided any mention of reducing emissions. Black

concluded that was a disconnect between the political process and the

scientific imperative. Despite such criticism, certain strides were made

at COP12, including in the areas of support for developing countries

and clean development mechanism. The parties adopted a five-year plan

of work to support climate change adaptation by developing countries,

and agreed on the procedures and modalities for the Adaptation Fund.

They also agreed to improve the projects for clean development

mechanism.

2007 - COP 13/MOP 3, Bali, Indonesia

COP 13/MOP 3 took place between December 3 and December 15, 2007,

at Nusa Dua, in Bali, Indonesia. Agreement on a timeline and structured

negotiation on the post-2012 framework (the end of the first

LII
commitment period of the Kyoto Protocol) was achieved with the

adoption of the Bali Action Plan (Decision 1/CP.13). The Ad Hoc Working

Group on Long-term Cooperative Action under the Convention (AWG-

LCA) was established as a new subsidiary body to conduct the

negotiations aimed at urgently enhancing the implementation of the

Convention up to and beyond 2012. These negotiations took place

during 2008 (leading to COP 14/MOP 4 in Poznan, Poland) and 2009

(leading to COP 15/MOP 5 in Copenhagen).

2008 United Nations Climate Change

Conference

2008 United Nations Climate Change Conference COP 14 in Poznan.

COP 14/MOP 4 took place from 1 to12 December 2008 in Poznań,

Poland. Delegates agreed on principles for the financing of a fund to

help the poorest nations cope with the effects of climate change and

they approved a mechanism to incorporate forest protection into the

efforts of the international community to combat climate change.

2009 - COP 15/MOP 5, Copenhagen, Denmark

COP 15 took place in Copenhagen, Denmark, from 7 December to 18

December 2009.

LIII
The overall goal for the COP 15/MOP 5 United Nations Climate Change

Conference in Denmark was to establish an ambitious global climate

agreement for the period from 2012 when the first commitment period

under the Kyoto Protocol expires. However, on 14 November 2009, the

New York Times announced that "President Obama and other world

leaders have decided to put off the difficult task of reaching a climate

change agreement... agreeing instead to make it the mission of the

Copenhagen conference to reach a less specific “politically binding”

agreement that would punt the most difficult issues into the future."

Ministers and officials from 192 countries took part in the Copenhagen

meeting and in addition there were participants from a large number of

civil society organizations. As many Annex 1 industrialized countries

are now reluctant to fulfill commitments under the Kyoto Protocol, a

large part of the diplomatic work that lays the foundation for a post-

Kyoto agreement was undertaken up to the COP15.

The conference did not achieve a binding agreement for long-term

action. A 13-paragraph 'political accord' was negotiated by

approximately 25 parties including US and China, but it was only 'noted'

by the COP as it is considered an external document, not negotiated

within the UNFCCC process. The accord was notable in that it referred

to a collective commitment by developed countries for new and

additional resources, including forestry and investments through

LIV
international institutions that will approach USD 30 billion for the period

2010 - 2012. Longer-term options on climate financing mentioned in the

accord are being discussed within the UN Secretary General's High

Level Advisory Group on Climate Financing, which is due to report in

November 2010. The negotiations on extending the Kyoto Protocol had

unresolved issues as did the negotiations on a framework for long-term

cooperative action. The working groups on these tracks to the

negotiations are now due to report to COP 16 and MOP 6 in Mexico.

2010 - COP 16/MOP 6, Cancun, Mexico

COP 16 is expected to be held in Cancún, Mexico, from 29 November to

10 December 2010.

2011 - COP 17/MOP 7, South Africa

The 2011 COP 17 is to be hosted by South Africa from 28 November to 9

December 2011. It is likely that the event will be hosted in

Johannesburg.

2012 - COP 18/MOP 8

Two countries, Qatar and South Korea, are currently bidding to host the

2012 COP 18.

The Kyoto Protocol

The Kyoto Protocol is a protocol to the United Nations Framework

Convention on Climate Change (UNFCCC or FCCC), aimed at fighting

global warming. The UNFCCC is an international environmental

LV
treaty with the goal of achieving "stabilization of greenhouse

gas concentrations in the atmosphere at a level that would

prevent dangerous anthropogenic interference with the climate system."

The Protocol was initially adopted on 11 December 1997

in Kyoto, Japan and entered into force on 16 February 2005. As of

November 2009, 187 states have signed and ratified the protocol.

Under the Protocol, 39 industrialized countries and the European

Union(called "Annex I countries") commit themselves to a reduction of

four greenhouse gases (GHG) (carbon dioxide, methane, nitrous oxide,

sulphur hexafluoride) and two groups of gases (hydrofluorocarbons and

perfluorocarbons) produced by them, and all member countries give

general commitments. Annex I countries agreed to reduce their

collective greenhouse gas emissions by 5.2% from the 1990 level.

Emission limits do not include emissions by international aviation and

shipping, but are in addition to the industrial

gases,chlorofluorocarbons, or CFCs, which are dealt with under the

1987 Montreal Protocol on Substances that Deplete the Ozone Layer.

The benchmark 1990 emission levels were accepted by the Conference

of the Parties of UNFCCC (decision 2/CP.3) were the values of "global

warming potential" calculated for the IPCC Second Assessment Report.

These figures are used for converting the various greenhouse gas

emissions into comparable CO2 equivalents (CO2-eq) when computing

overall sources and sinks.

LVI
The Protocol allows for several "flexible mechanisms", such

as emissions trading, the clean development mechanism (CDM) and

joint implementation to allow Annex I countries to meet their GHG

emission limitations by purchasing GHG emission reductions credits

from elsewhere, through financial exchanges, projects that reduce

emissions in non-Annex I countries, from other Annex I countries, or

from annex I countries with excess allowances.

Each Annex I country is required to submit an annual report of

inventories of all anthropogenic greenhouse gas emissions from

sources and removals from sinks under UNFCCC and the Kyoto

Protocol. These countries nominate a person (called a "designated

national authority") to create and manage its greenhouse gas inventory.

Virtually all of the non-Annex I countries have also established a

designated national authority to manage its Kyoto obligations,

specifically the "CDM process" that determines which GHG projects

they wish to propose for accreditation by the CDM Executive Board.

CLEAN DEVELOPMENT MECHANISM

The central feature of the Kyoto Protocol is its requirement that

countries limit or reduce their greenhouse gas emissions. By setting

such Targets, emission reductions took on economic value. To help

countries meet their emission targets, and to encourage the private

LVII
sector and developing countries to contribute to emission reduction

efforts, negotiators of the Protocol included three market-based

mechanisms – Emissions Trading, the Clean Development Mechanism

and Joint Implementation.

Clean Development Mechanism

The CDM allows emission-reduction (or emission removal) projects in

developing countries to earn certified emission reduction (CER) credits,

each equivalent to one tonne of CO2. These CERs can be traded and

sold, and used by industrialized countries to a meet a part of their

emission reduction targets under the Kyoto Protocol.

The mechanism stimulates sustainable development and emission

reductions, while giving industrialized countries some flexibility in how

they meet their emission reduction limitation targets.

The projects must qualify through a rigorous and public registration and

issuance process designed to ensure real, measurable and verifiable

emission reductions that are additional to what would have occurred

without the project. The mechanism is overseen by the CDM Executive

Board, answerable ultimately to the countries that have ratified the

Protocol.

In order to be considered for registration, a project must first be

approved by the Designated National Authorities (DNA).

LVIII
Operational since the beginning of 2006, the mechanism has already

registered more than 1,000 projects and is anticipated to produce CERs

amounting to more than 2.7 billion tonnes of CO2 equivalent in the first

commitment period of the Kyoto Protocol. The mechanism is seen by

many as a trailblazer. It is the first global, environmental investment and

credit scheme of its kind, providing a standardized emission offset

instrument, CERs.

CDM INDIA

India is a Party to the United Nations Framework Convention on Climate

Change (UNFCCC) and the objective of the Convention is to achieve

stabilization of greenhouse gas concentrations in the atmosphere at a

level that would prevent dangerous anthropogenic interference with the

climate system.

To strengthen the developed country commitments under the

Convention, the Parties adopted Kyoto Protocol in 1997, which commits

developed country Parties to return their emissions of greenhouse

gases to an average of approximately 5.2% below 1990 levels over the

period 2008-12

Figure 2.1: CDM Project Cycle

LIX
LX
Legend

PP - Project Proponent

DOE - Designated Operational Entities

AE - Applicant Entity

EB - Executive Board

COP/MOP - Conference of the Parties and Meetings serving as

the meeting of the Parties to the Kyoto Protocol

CER - Certified Emission Reductions

DNA - Designated National Authority

Green Trade & Development

Used for years in local and regional pollution control programs in the

United States, market approaches are now recognized for their ability to

provide cost savings and flexibility to companies and countries

committed to greenhouse gas control. Green Markets believes that well-

crafted rules and oversight are needed to assure that pollution trading

does not compromise environmental objectives. With greenhouse gas

trading, though, the benefits can go well beyond compliance flexibility

and economic efficiency.

The greenhouse gas reduction market can potentially catalyze projects

with important local environmental, economic, and quality-of-life

benefits. The Kyoto Protocol’s Clean Development Mechanism (CDM),

LXI
for example, enables trading between industrial and developing nations,

providing a framework that can result in capital flows to environmentally

beneficial development activities. Although the United States is not

participating in the Kyoto Protocol, several US programs enable similar

transactions on a voluntary and regulatory basis.

While international trade in greenhouse gas reductions holds

substantial promise as a source of new funding for sustainable

development, this market can be largely inaccessible to many smaller-

scale projects, remote communities, and least developed localities. To

facilitate participation and broaden the benefits, several barriers must

be overcome, including: a lack of market awareness among

stakeholders and prospective participants; specialized, somewhat

complicated participation rules; and the need for simplified participation

mechanisms for small projects, without which transaction costs can

overwhelm the financial benefits of participation. If the barriers are

adequately addressed, greenhouse gas trading can play an important

role supporting activities that benefit people’s lives and the

environment.

Green Markets’ Programs

In collaboration with others, through a mix of technical assistance,

educational outreach, and other strategies, Green Markets has strived to

increase the use of renewable energy and energy efficiency for

environmental protection and economic development. Many programs

LXII
have helped to enhance the capacity of sustainable energy stakeholders

to participate in the international carbon market, and included direct

technical support for carbon market participation. Currently Green

Markets provides resources through its website to help build knowledge

about carbon market logistics and opportunities, and about other

mechanisms to support the expanded use of renewable energy, energy

efficiency, and other climate protection options. Carbon Market

Information

Sustainable Energy Acceleration

Carbon Market Information

A range of activities can generate greenhouse gas reductions while

advancing sustainable development. The carbon offsets market holds

substantial promise as a source of catalytic funding, but barriers often

impede market access for small and medium sized enterprises, local

government bodies, and development organizations.

Green Markets' carbon market information program provides

information and links to resources to increase knowledge about the

greenhouse gas reduction market so that it can become more broadly

inclusive, with the goal of helping to enable carbon market access for

small-scale activities and for initiatives conceived and implemented by

stakeholders who might otherwise be left out.

LXIII
 CHAPTER-3

GREEN MARKETING

LITERATURE REVIEW

LXIV
 CHAPTER-3

GREEN MARKETING: LITERARURE REVIEW

Over the last 50 years, since evolution, Green Marketing has witnessed

many success and pitfalls in both academics and markets. It has

evolved from the term marketing of environmental friendly products to

marketing of green products to green marketing.

Literature Review

To get an in-depth insight into the topic of green marketing an extensive

literature review is done on e-libraries like proquest and ebsco,

departmental library, journals, books etc.

A search on Ebsco on the topic ‘green marketing’ had generated 239

peer-reviewed full text papers and a search on proquest generated 171

results. The earliest article found in the search result dated back to 1971

in Journal of Marketing which shows that in early 70’s academicians

started thinking about environment and social responsibility. Though

many studies are there but very few work has been done in India on

Green marketing.

LXV
EVOLUTION OF GREEN MARKETING

Green Marketing has been an important academic research topic since

its inception. The concept of green marketing has been around at least

since the first Earth Day in 1970 and later when the American Marketing

Association organized workshop on Ecological Marketing in 1975. But

the idea did not catch on until the 1980s, when rising public interest in

the environment led to a demand for more green products and services.

The evolution of green marketing involves three phases.

First phase was termed as "Ecological" green marketing, and during

this period all marketing activities were concerned to help environment

problems and provide remedies for environmental problems.

Second phase was "Environmental" green marketing and the focus

shifted on clean technology that involved designing of innovative new

products, which take care of pollution and waste issues.

Third phase is "Sustainable" green marketing. It came into prominence

in the late 1990s and early 2000.

The concept of green marketing seems to take its foundations into the

concept of traditional marketing itself (Polonsky, 1994; Charter et al,

1999). According to Prakash (2002), the relationship between the

marketing discipline, the public policy process and the natural

environment is important. This relationship is described by many terms:

environmental marketing (Coddington, 1993), ecological marketing

(Fisk, 1974; Henion and Kinnear, 1976), green marketing (Peattie, 1995;

LXVI
Ottman, 1992), sustainable marketing (Fuler, 1999) and greener

marketing (Charter and Polonsky, 1999). Task of marketing now is to

walk on a tight rope to achieve the triple bottom line of PPP.

The first substantial work on ecological marketing came into existence

by Henion and Kinnear in 1976 (as quoted by Polonsky 1994). In their

publications in 1976 Henion and Kinnear defined the ecological

marketing as “the study of the positive and negative aspects of

marketing activities on pollution, energy depletion and non-energy

resource depletion (Henion and Kinnear quoted by Polonsky 1994, p2)”.

They further defined ecological marketing as “The implementation of

marketing programs directed at the environmentally conscious market

segment” (Henion 1976). The concept is further evolved to “The process

of planning, implementing and controlling the development, pricing,

promotion and distribution of products in a manner that satisfies the

following criteria- Customer needs are met, Organizational goals are

attained, And the processes are compatible with ecosystems” (Fuller

1999).

According to Ottman (1993) Green Marketing serves two key objectives-

 To develop products that incorporates consumer need for

convenience, affordable prices and performance while having minimal

impact on the environment

LXVII
 To project an image of high quality, including environmental

aspects, both in regards to product attributes and the manufacturer's

track record for environmental compliance.

First consumer survey was conducted by Vandermerwe and Ollif (1990)

stating that more then 92% European multinationals clamed to have

changed their products in response to green concern. Green products

introduction increased by more then double to 11.4% of all new

household products in the USA between 1989 and 1990 and continued

to rise to 13.4% in 1991. In spite of its growing popularity, the green

marketing movement faced serious setbacks in the late 1980s (Peattie

and Crane 2005). A 2001 survey conducted by Roper indicates that

during the 1990’s approximately 2/3 of all consumers believed that

environmental protection and economic development can go hand in

hand. While perception is important, actual behavior is crucial to market

success. A report (conducted by Mintel 1995) showed only a very slight

increase in green consumer since 1990 and a significant gap between

concern and actual purchasing.

The setback came because many industries made false claims about

their products and services. For instance, the environmental

organization CorpWatch, which issues annually a list of the top ten

"greenwashing" companies, included BP Amoco for advertising its

"Plug in the Sun" program, in which the company installed solar panels

in two hundred gas stations, while continuing to aggressively lobby to

LXVIII
drill for oil in the Arctic National Wildlife Refuge. The media came up

with the term "Greenwashing" to describe cases where organizations

misrepresented themselves as environmentally responsible. To put it

this way-

"I'm skeptical sometimes because [a product] will have a green logo but

no explanation as to how it is green. This leads me to think they just

slapped a sucker on... as a consumer, you can't always believe what

you are told." (Audray Gray, 2009).

Without environmental labeling standards, consumers could not tell

which products and services were truly beneficial. Consumers ended up

paying extra for misrepresented products. So In 1992, to prevent the

further deception, the Federal Trade Commission (FTC) stepped in and

created guidelines for the use of environmental marketing claims such

as "recyclable," "biodegradable," "compostable," and the like. The FTC

and the U.S. Environmental Protection Agency defined "environmentally

preferable products" as products and services that have a lesser or

reduced effect on human health and the environment when compared to

other products and services that serve the same purpose. The label

"environmentally preferable" considers how raw materials are acquired,

produced, manufactured, packaged, distributed, reused, operated,

maintained, or how the product or service is disposed. These guidelines

helped the customers to identify the compatible products but still the

LXIX
uptake of Green Products is very less throughout leading us to “Green

Myopia”.

Attention towards this phenomenon is drawn by Ottman, Stanford and

Hartman (2006) where they defined it as “Green marketing must satisfy

two objectives:

 Improved environmental quality

 Customer satisfaction.

Misjudging either or overemphasizing the former at the expense of the

latter can be termed “green marketing myopia.” Miller (2008) claims that

green marketing is a concept that, when implemented effectively, can

improve the customer relationships, image in the market and ability to

reach the most targeted audience, while helping grow the bottom line.

Various views have been developed in order to implement a green

marketing strategy. Glorieux-Boutonnat (2004) argues that the concept

tries to mix two concepts which have diverging goals. According to her

the marketing focuses on seducing consumers and generating

profitable sales rapidly and they take the environment into

consideration as far as it helps achieving that goal. Polonsky (1994)

however noticed that unfortunately a majority of people believes that

green marketing refers solely to the promotion or advertising of

products with environmental characteristics. This also explains why the

concept is often linked with terms like phosphate free, recyclable,

refillable, ozone friendly... He also claims that the green marketing

LXX
incorporates a broad range of activities, including product modification,

changes to the production, packaging changes, as well as advertising. A

study by Nancy E. Furlow (2010) described the phenomena of Green

washing in an elaborated way and also gave the managerial

implications. According to that article early 1990s saw a rapid rise in

products touting environmental claims. The "green" phenomenon of the

'90s disappeared as rapidly as it appeared, but today many

manufacturers are again revisiting the value of promoting their

products, or even themselves, as being green to attract a growing

environmentally aware segment. In attracting a green audience,

companies often use claims that sound environmentally friendly, but are

actually vague, and at times may be false. As a result, "Greenwashing"

has become commonplace in market. Green washing is the

dissemination of false or incomplete information by an organization to

present an environmentally responsible public image.

The proliferation of environmental disinformation, or greenwashing, has

become so common and is of such a concern, that EnviroMedia

developed the Greenwashing Index to monitor environmental claims

used by manufacturers (Miller, 2008). On the web site, anyone can post

ads deemed to be misleading and rate how the deception compares with

other advertisements. Greenwashingindex.com is the result of the

incredible growth of green claims in the past few years. The site allows

consumers an outlet to express concerns and raise questions about

LXXI
these environmental claims. By giving the public a channel to judge

these messages, consumers have put marketers on guard that

environmental claims will not go unchecked.

When pointing to green-washing, one of the most cited examples is

Ford Motor Company's "It Isn't Easy Being Green" campaign for the

hybrid Escape SUV. While touting itself as being environmentally

friendly, Ford's cars were considered the worst carbon emitters and had

the worst fuel efficiency trend of any major automaker according to

Union of Concerned Scientists (Friedman & Mackenzie, 2004). Since its

early and much-criticized entry into the hybrid market, Ford has backed

away from promoting itself as the green car choice.

General Electric has also been cited as a green-washer. The company's

"EcoImagination" campaign highlights the work the company is doing

in the environmental arena, but GE's environmental practices have been

largely criticized. In 2000, GE went as far as the Supreme Court to fight

the new clean air EPA requirements. Moreover, GE is still fighting an

EPA-ordered clean up of the Hudson River where it dumped PCBs

between 1940 to 1977, not to mention the other dozen or so superfund

sites it is still fighting (Source Watch, 2008).

In an industry considered to be anything but environmentally friendly,

petroleum giant BP has decided to label itself as the green oil company.

Admittedly, the company is not as "brown" as other oil giants, but by

claiming to be earth conscious, BP has set itself up to be widely

LXXII
criticized. Since 2000, BP has used the tag line "Beyond Petroleum" as

part of its green campaign. The overhaul of BP's image has been

celebrated by some as a rebranding success and decried by others as a

perfect example of greenwashing (Solman, 2008). BP's less than green

activities include lobbying efforts to open restricted spaces such as the

Arctic National Wildlife Refuge to drilling and illegally dumping

hazardous waste from the Endicott Island oil field between 1993 and

1995. The company was even named as one of the 10 worst companies

in 2005 by Multinational Monitor. Most recently, BP was forced to shut

down operations in 2006 in Prudhoe Bay as the result of a ruptured

decayed pipeline. Even with its questionable environmental track

record, BP has undoubtedly been successful in painting itself green. BP

ranked highest among energy companies for being green in the

"ImagePower Green Brands Survey" conducted last year and 49 percent

of respondents felt that BP had become greener in the past five years

(Solman, 2008).

The multitude of vague and misleading environmental claims has

caused consumers to question corporate honesty, and cry

greenwashing at every turn. The concern over greenwashing is not only

that it misleads consumers, but also that if unscrupulous marketers

continue to claim to be environmentally friendly, then companies true to

their environmental mission lose their competitiveness. In addition,

overuse and misuse of the "green" claims can saturate the market to the

LXXIII
point that the greenness of the product may become meaningless to the

consumer (Zimmer et. al, 1994).

Another reason why consumers may be suspicious of green advertising

claims is that the scientific knowledge required to understand many

environmental issues is often complex and subject to change, thereby

making it difficult for the general public to comprehend. In addition,

comparisons made between products are frequently limited to a single

environmental benefit, making the claim incomplete and misleading (for

example paper vs. plastic). Whole Foods is under attack for this very

reason. The Environmental Affairs Council filed action last year with the

Federal Trade Commission over the grocery chain's claim of greenness

for using only 100% recycled paper bags (Enviros to FTC, 2008).

The implications of green-washing are wide spread. Consumers may

become confused about which products actually do help the

environment. Because of increased consumer skepticism, legitimate

attempts by companies to become less environmentally harmful will

lose any competitive edge they might have gained. Finally, there will be

fewer rewards and therefore less motivation for companies to make

environmentally helpful products, as consumers will "discount" all

environmental marketing claims. Therefore, in the end, inaccurate

environmental marketing will not only hurt consumers and firms, but it

will also harm our environment (Polansky, et. al, 1998). If the consumer

finds the claim to be unreliable, they are likely to disregard all

LXXIV
environmental claims, thereby avoiding any product that may in fact be

better for the environment (Mayer, et. al, 1993).

The decision to use environmental claims in marketing communications

is a serious one. Environmental claims must be honest, sincere and a

reflection of the organization's mission. The role of a sustainability

officer has become more commonplace as research indicates that

consumers today equate environmental behavior to a corporation's

social responsibility track record (Frazier, 2008). Case in point, Wal-Mart

has come out of the shadows about its steps to become environmental,

and, much like other companies, has named a "sustainability officer" to

oversee environmental practices of the company.

Here we can say that a plethora of literature is coming on explaining the

concept of Green Marketing and various phenomena related to the

concept. Still there is a lack of proper perceptive on consumer behavior

towards their response to Green products.

LITERATURE REVIEW ON VARIOUS VARIABLES USED IN

VARIOUS STUDIES

There has been a whole wealth of research, using a variety of

segmentation variables, attempting to profile the environmentally

conscious members of the population in general.

The measures that have been used in various studies on green

marketing fall into two distinct categories:

LXXV
1. Socio-demographics, such as sex, age, education and social class

(see Schlegelmilch et al., 1994),

2. Personality measures- such as locus of control, alienation,

conservatism and dogmatism (e.g. Balderjahn, 1988; Crosby et al., 1981;

Henion and Wilson, 1976; Kinnear et al., 1974).

Given the relative ease with which socio-demographics can be

measured and applied, it is not surprising these have been the most

widely used variables for profiling purposes. However, recent evidence

illustrates that “there is very little value in the use of socio-demographic

characteristics for profiling environmentally-conscious consumers in

the UK” (Schlegelmilch et al . 1994, p. 348), with only very weak

relationships uncovered on a bivariate basis.

Indeed, focusing specifically on pro-environmental purchasing

behaviour, Schlegelmilch et al. (1994) explained, less than 10 per cent of

variation through multiple regression procedures; this is in line with US

studies that have performed multivariate analyses to link such

characteristics to measures of green behaviour (Van Liere and Dunlap,

1980). The limited utility of sociodemographics may be explained by the

fact that the environment is no longer a marginal issue; indeed,

“environmental concern is becoming the socially accepted norm”

(Schwepker and Cornwell, 1991, p. 85). Thus, it perhaps should not be

expected that high levels of green purchasing behaviour would only be

reflected in certain socio-demographic sectors of the consumer base.

LXXVI
Personality variables have been found to have somewhat higher

linkages to individuals’ environmental consciousness (Kinnear et al.,

1974; Schwepker and Cornwell, 1991). However, while this is true for

general environmental measures, the results are somewhat inconsistent

for specific pro-environmental behaviours, such as green purchasing

decisions (see Balderjahn, 1988). Furthermore, personality variables

have been shown to “explain only a small part of the total variability of

the behavioural measures used” (Webster, 1975, p. 196). Indeed, Hooley

and Saunders (1993; p. 145) suggest that caution should be taken in

using personality variables for market segmentation according to

behavioural criteria: “In most instances, personality measures are most

likely to be of use for describing segments once they have been defined

on some other basis. It is quite possible, indeed probable, that

behaviour and reasons behind it will vary within segments defined on

the basis of personality characteristics alone”. Moreover, personality

variables “do not easily lead to segmentation strategy” (Webster, 1975,

p. 196) due to the inherently complex processes involved in their

measurement and interpretation.

Given the failures of the above two classes of variables, a study by

Schlegelmilch et.all (1996) proposes a new segmentation approach,

through an analysis of the linkages between proenvironmental purchase

behaviour and measures of environmental consciousness. The rationale

for this approach rests on the fact that consumers have traditionally

LXXVII
been shown to express their environmental consciousness through the

products they purchase.

ECONOMIC EVOLUTION OF GREEN MARKETING

Tracing back the historical evolution of economic activities carried out

by the human kind in order to survive begins with the origin of

civilization and trading with barter system. Industrial revolution in

eighteenth century turned the wheel and made earning profits from

economic activities as the prime motive. Exploitation of people and

planet had become prime aim to earn profits. Later towards the end of

19th century corporate world realized the importance of people in

economic activities. This was the time when development became the

agenda and many organizations started implementing OB tools to

improve the work place and work culture. Holistic development and

work – life balance became the talk of the town. Many strategies have

been applied to bring a balance in the life of workers, work hours got

fixed and HR people started working on compensations and leaves. No

doubts these strategies improved the quality of living condition of many

workers but still environment was something nobody was talking about.

With the increase in the environmental degradation and pollution levels

there is concern for better human life and more then that the existence

of future generations. Beginning of twenty first century is witnessing a

paradigm shift from people concern to environmental concern. The

LXXVIII
demand of a sustainable economy is calling a balanced integration of all

three factors profit, people and planet.

Twentieth Century

PLANET

Late Nineties

PEOPLE
Eighteenth

PROFIT

AWARENESS STAGES IN ECONOMIC DEVELOPMENT OF INDUSTRIES

Social and environmental responsibility of a nation involves many stake

holders. Prize–winning author and New York Times columnist Thomas

L. Friedman argues that government policy and industry should engage

in a “geo-green” strategy to promote energy efficiency, renewable

energy, and other clean-tech innovations to help alleviate the nation’s

dependency on oil from politically conflicted regions of the world

(Jacquelyn A. Ottman, Edwin R. Stafford, and Cathy L. Hartman, 2006).

LXXIX
Besides state and industry it is consumer who is an integral part of the

value chain of go green. Arnulf Grubler (A. Grubler, 2006) wrote in

Environment, “To minimize environmental impacts by significant orders

of magnitude requires the blending of good engineering with good

economics as well as changing consumer preferences.”

INDUSTRY STATE

CONSUMER

STAKE HOLDERS FOR GO GREEN STRATEGY

So to implement the Go Green strategy and to make it successful in any

nation it is an integrated effort required from state, Industry and

consumers to make this planet a safer place to live. Though government

of both developed and developing nations is taking several steps to

conserve energy and bringing in cleantech innovation, Companies are

LXXX
also finding it as a lucrative strategy to tap the consumer market.

According to Ottman (2006) a strong commitment to environmental

sustainability in product design and manufacturing can offer to

companies’ opportunities to grow their businesses, to innovate or to

build brand equity. However to exploit these economic opportunities to

steer global commerce onto a more sustainable path, green products

must appeal to consumers outside the traditional green niche. The

marketing discipline has long argued that innovation must consider an

intimate understanding of the customer and a close look at green

marketing practices over time reveals that green products must be

positioned on a consumer value sought by targeted consumers.

Though a plethora of literature is coming on Green Marketing still there

is a lack of proper perceptive on consumer behavior towards their

response to Green products (Artee Aggrawal et all., 2010). Asian-based

green marketing studies are relatively scant when compared to the

Western works (Kaman Lee (2008). There are only few to name (Chan,

2001; Yam-Tang and Chan, 1998), exploring the potential consumers in

Asian market. This raises the inquisitiveness of understanding the

customers in growing economies like India and various factors that

affect consumer Green purchase behaviour.

LXXXI
Specifically, it is predicted that many international companies will

aggressively initiate green marketing strategies in the Asian markets for

the following reasons:

The resource exploitation and pollution associated with the

unprecedented economic development in many Asian countries (such

as China) have raised local and global concerns about the quality of

environment in Asia (Martinsons et al., 1997)

Citizens in Asian societies are increasingly becoming conscious of

alarming environmental problems (Johri and Sahasakmontri, 1998)

Governmental policies and business strategies in many Asian countries

are being reshaped to give more consideration to long-term sustainable

developments including environment protection (Johri and

Sahasakmontri, 1998; Martinsons et al., 1997);

And the fast-growing economies in Asia have led to a vigorous rise of

financially-empowered consumers across Asia willing to spend more

than previous generations (Li and Su, 2007; Tai and Tam, 1997; The

Economist, 2006).

In view of the potentially prosperous green market in Asia, many

Western firms are preparing to capitalise on the predicted demand for a

greener lifestyle among Asian consumers in the near future.

Notwithstanding the growing interest in culture among marketing

scholars, surprisingly little research informs on how Asian consumers

interpret and react to green marketing. Certainly, green marketing is

LXXXII
emerging in many Asian countries. However, because little research has

been conducted in an Asian culture, international green marketers have

expressed that the unavailability of market information in foreign

countries often becomes a major hindrance to the success of

international expansion of their green products (Gura˘u and Ranchhod,

2005).

LXXXIII
 CHAPTER-4

GREEN MARKETING:

CASE STUDIES

LXXXIV
 CHAPTER-4

GREEN MARKETING: CASE STUDIES

When consumers are convinced of “non-green” benefits, they are more

inclined to adopt green products. Green products succeed when

marketers kept their eyes on “The Three Cs”:

 Consumer value positioning

 Calibration of consumer knowledge

 Credibility of product claims.

The 4 P's of green marketing, according to a study, are that of

conventional marketing but the challenge before marketers is to use 4

P's in an innovative manner. Like conventional marketers, green

marketers must address the ‘Four Ps’ in innovative ways:

Product

Entrepreneurs wanting to exploit emerging green markets either:

 Identify customers’ environmental needs and develop products to

address these needs or

 Develop environmentally responsible products to have less impact

than competitors.

LXXXV
The increasingly wide variety of products on the market that support

sustainable development and are good for the triple bottom line include

products made from recycled goods, such as Quik’N Tuff housing

materials made from recycled broccoli boxes and products that can be

recycled or reused. Efficient products, which save water, energy or

gasoline, save money and reduce environmental impact. Queensland’s

only waterless printer, Print point, reduces operating costs by using

less water than conventional printers and is able to pass the savings on

to customers. Products with environmentally responsible packaging,

McDonalds, for example, changed their packaging from polystyrene

clamshells to paper.

Products with green labels, as long as they offer substantiation,

Organic products — many consumers are prepared to pay a premium

for organic products, which offer promise of quality. Organic butchers,

for example, promote the added qualities such as taste and tenderness.

A service that rents or loans products – such as toy libraries, Certified

products, which meet or exceed environmentally responsible criteria.

Whatever the product or service, it is vital to ensure that products meet

or exceed the quality expectations of customers and is thoroughly

tested.

LXXXVI
Price

Pricing is a critical element of the marketing mix. Most customers are

prepared to pay a premium if there is a perception of additional product

value. This value may be improved performance, function, design,

visual appeal or taste. Environmental benefits are usually an added

bonus but will often be the deciding factor between products of equal

value and quality. Environmentally responsible products, however, are

often less expensive when product life cycle costs are taken into

consideration. For example fuel-efficient vehicles, water-efficient

printing and non-hazardous products.

Place

The choice of where and when to make a product available, has a

significant impact on the customers being attracted. Very few

customers go out of their way to buy green products merely for the sake

of it. Marketers looking to successfully introduce new green products

should, in most cases, position them broadly in the market place so

they are not just appealing to a small green niche market. The location

must also be consistent with the image which a company wants to

project. The location must differentiate a company from its competitors.

This can be achieved by in-store promotions and visually appealing

LXXXVII
displays or using recycled materials to emphasize the environmental

and other benefits.

Promotion

Promoting products and services to target markets includes paid

advertising, public relations, sales promotions, direct marketing and on-

site promotions. Smart green marketers will be able to reinforce

environmental credibility by using sustainable marketing and

communications tools and practices. For example, many companies in

the financial industry are providing electronic statements by email, e-

marketing is rapidly replacing more traditional marketing methods, and

printed materials can be produced using recycled materials and efficient

processes, such as waterless printing. Retailers, for example, are

recognizing the value of alliances with other companies, environmental

groups and research organizations when promoting their environmental

commitment. To reduce the use of plastic bags and promote their green

commitment, some retailers sell shopping bags, under the banner of the

Go Green Environment Fund. The key to successful green marketing is

credibility. Never overstate environmental claims or establish unrealistic

expectations, and communicate simply and through sources that people

trust.

LXXXVIII
CASE STUDIES OF GREEN PRODUCTS AND

SERVICES:

As the world’s center of gravity shifts decisively in favor of emerging

markets, competitive challenges and opportunities are being continually

and dramatically transformed. And, no emerging market offers as much

long-term opportunity for multinationals as India does-

 India’s 1.15 billion population, and the world’s largest population in

the "Under 25” years age group

 The largest democracy in the world, with greater political and social

stability than China.

 The second fastest growing economy, and the 4th largest economy

PPP (purchasing power parity), in the world

 Second only to the United States in English-speaking scientific

manpower

 A well diversified industrial base in all core manufacturing and

service industries

 Over 100 global companies have R&D centers in India, and

thousands more sell to India or otherwise leverage India’s resources to

become more competitive themselves

LXXXIX
It is because of all these reasons that multinationals today are eyeing

India and introducing their products in the Indian market. Many Green

products have been launched here and the performance of these

products is good among Indian consumers. Some of the successful

case studies of green marketing are-

CNG TRANSPORT IN NEW DELHI

New Delhi, capital of India, was being polluted at a very fast pace until

Supreme Court of India forced a change to alternative fuels. In 2002, a

directive was issued to completely adopt CNG in all public transport

systems to curb pollution.

GOING GREEN: TATA’S NEW MANTRA :

Tata group of companies in India has taken considerable Steps to Cut

Carbon Emission across Companies, Value Chain. If globalization was

the driving factor for Tata Group in the last decade, going green is the

buzzword for the present one. From being on the fringe, the green

movement is gaining momentum within the group. India’s oldest

industrial house is stepping up efforts to reduce its carbon footprint

across the value chain — from manufacturing processes to distribution

networks to ecofriendly consumer products. For instance, Tata Steel

aims to reduce carbon dioxide emissions at its Jamshedpur plant from

the current 1.8 tone to 1.7 tons per ton of liquid steel made by 2012. The

ideal global benchmark though is 1.5.

XC
Tata Motors is setting up an eco-friendly showroom using natural

building material for its flooring and energy efficient lights. Tata Motors

said the project is at a preliminary stage.

The Indian Hotels Company, which runs the Taj chain, is in the process

of creating eco rooms which will have energy-efficient mini bars,

organic bed linen and napkins made from recycled paper. But there

won’t be any carpets since chemicals are used to clean those. And

when it comes to illumination, the rooms will have CFLs or LEDs. About

5% of the total rooms at a Taj hotel would sport a chic eco-room design.

One of the most interesting innovations has come in the form of a

biogas-based power plant at Taj Green Cove in Kovalam, which uses the

waste generated at the hotel to meet its cooking requirements. Tata had

launched a low-cost water a low-cost water purifier made from natural

ingredients. Another eco-friendly consumer product that is in the works

is Indica EV, an electric car that will run on polymer lithium ion batteries.

Tata Motors plans to introduce the Indica EV in select European markets

this year. The group’s large companies such as Tata Steel, Tata Motors,

Tata Chemicals and Tata Consultancy Services contribute 80% of the

group’s overall emissions and a panel, headed by Tata Sons director JJ

Irani, has been formed to address this issue. Several companies have

already or are in the process of implementing clean development

mechanism (CDM) projects. Tata Steel said it is currently working on

more than 17 CDM projects with Ernst & Young

XCI
and these projects are at various stages of approval at United Nations

Framework Convention on Climate Change. Tata Power has said that of

the total power it would generate in the next 10 years, 25% would be

from renewable energy sources. Tata Motors is collecting environmental

and energy data across its dealer and supply chain to compute their

carbon footprint and identity opportunities for cutting down on carbon

dioxide emission. This initiative will enable sharing and deployment of

ideas throughout the value chain.

A source in Indian Hotels said that all of its domestic and international

hotels would be certified by Green Globe, an international agency by the

end of 2010. Clean Technology Tata Steel aims to reduce carbon dioxide

emissions at its Jamshedpur plant from 1.8 tons to 1.7 tons per ton of

liquid steel made by 2012. Global benchmark is 1.5. Tata Motors is

setting up an eco-friendly showroom using natural materials.

NGOs Campaigning Against Polythene

Self help groups in Uttarakhand, India have launched a campaign to

banish polythene bags by replacing them with paper bags and providing

them to shop keepers at lucrative prices. "Pahal" is one such group that

has been training women to make paper bags from old newspapers.

Women in this group are now earning anything between Rs 300 to Rs

XCII
4,000 per month from their own homes. This drive has produced a

sustainable livelihood for the poor women in that area.

Green Building Initiatives in India

GREEN BUILDING DEFINED

"A green building is one which uses less water, optimises energy

efficiency, conserves natural resources, generates less waste and

provides healthier spaces for occupants, as compared to a conventional

building."

India is serious about green initiatives and is well on its way to

implementing them in future projects. The changes would come by way

of spreading awareness, dispelling myths and educating the trade and

industry in the benefits of going green.

The rapid progress made by the Indian Green Building Council in India

and the prestigious green building projects being awarded the Platinum,

Gold and Silver ratings already in operation in India.

SCORECARD

944 members (82 Founding Members)

687 registered buildings

117 certified buildings

433.26 million sqft Green building footprint

XCIII
The only deterrent for going green, apparently, is the myth that project

costs are prohibitive and unaffordable. The construction industry and

upcoming Special Economic Zones would certainly welcome these

changes and implement them – with the same approach as India’s was

to USA – offer the carbon-credit carrot for implementation, but not to

make it mandatory and impose penalties or fines for non-conforming to

stipulated norms.

ITC-CHAIN OF GREEN HOTELS IN INDIA

ITC Welcomgroup, India's premier chain of luxury hotels was launched

on October 18, 1975, with the opening of its first hotel - Chola Sheraton

in Chennai. Since then the ITC-Welcomgroupbrand has become

synonymous with Indian hospitality. With over 100 hotels in more than

80 destinations, ITC-Welcomgroup has set new standards of excellence

in the hotel industry in Accommodation, Cuisine, Environment and

Guest Safety. A leader in the premium hospitality segment, ITC-Welcom

group Hotels have had the privilege of hosting world leaders, Heads of

State and discerning guests from across the world and within.

ITC- Welcomgroup is actively committed to the environment.

WelcomEnviron is vision for a green world. It’s a multi-faceted

programme started in order to propagate environmental causes in the

cities where ITC-Welomgroup’s hotels are located. The guiding principle

XCIV
is ‘Reduce, Reuse and Recycle’. Each hotel has its own programme,

encompassing local participation, creating awareness among

employees and internal conservation through energy-saving gadgets

and environment-friendly material. Guests are also encouraged to be a

part of campaign, ‘Give back as much as you take from the

environment’.

Awards

· ITC Mughal won the Golden Peacock award for the year 2004.

· ITC Maratha won the FHRAI Environment Champion award.

· ITC Green Centre was given the US Green Building Council

Platinum Rating.

· ITC Hotels received the PATA Gold Environment Award in 2005 in the

Corporate category

ITC Green Centre

The ITC Green Centre in Gurgaon is the physical expression of this

commitment to sustainability - Ecological, Social and Economic. The

building was awarded Platinum rating by the US Green Building Council

– LEED.

Greening of the supply chain (GSC)

ITC Hotels made a humble start in the 'Greening' of the supply chain (GSC)

XCV
recently, with the clear intent of attempting to work towards'creating a sea of

excellence' as opposed to an'island of excellence' in the economic domain

through industry initiative, by inducing our suppliers to adopt cleaner & greener

production (C & GP) practices.

NTPC

Badarpur Thermal Power station of NTPC in Delhi is devising ways to

utilize coal-ash that has been a major source of air and water pollution.

Barauni refinery of IOC is taken steps for restricting air and water

pollutants.

SOME OTHER SUCCESS STORIES

Conceived and designed by a pharmacy student from Jeypore College

of Pharmacy in Visakhapatnam, the bike, if brought into the market, will

make commuting easier for those with dysfunctional arms and hands. It

does not have handles and can be used to go out on the road. bike has

a seat and two footrests on either side. The user can navigate the bike

using push buttons fitted in a corner of one of the footrests.

Some projects were designed completely for philanthropic purposes —

like Project Banana by an entrepreneur from Andhra Pradesh. For the

past three years, his teams have been collecting banana peels from the

areas near Godavari and produce thread out of it. Local women and

seasonal farmers are then put to weaving rugs and making paper.

XCVI
Gujarat University converts banana plant waste into useful products. A

Gujarat based agriculture university has successfully converted those

parts of the fruit's plant which are usually thrown away as waste into

highly useful products, including an edible candy with nutritional

values. The other products include fibre for textile and paper industry

and organic liquid fertilizer which have been developed under the

project which aims for efficient use of each and every component of

banana plant. This candy is made from the central core of the banana

plant pseudostem, which is a nutrition-rich part. The candy has been

developed on experimental basis and we are in the process of

standardising the product. And also looking at the demand for banana

in the international market and with new technologies evolved for better

yield, farmers have shown interest in its cultivation in state mainly in

districts of south Gujarat.

Unleashes yet another technological revolution JK Tyre - India's No.1

manufacturer of four-wheeler tyres and pioneers of radial tyre

technology in India, unveiled nation's first eco-friendly colored radials.

Developed indigenously at JK Tyre's state-of-the-art R&D facilities

HASETRI (Hari Shankar Singhania Elastomer and Tyre Research

Institute), these tyres employ path-breaking technology which replaces

the traditionally used Carbon Black with environment friendly material

Silica. Besides being environmentally less hazardous, silica also

promises higher fuel efficiency as a result of its lower rolling

XCVII
resistance.

These tyres will also have longer life due to advanced compounding

technology - offering excellent performance, handling and braking that

are a hallmark of tyres from JK Tyre. A result of JK Tyre's pioneering

research initiatives into new-age environment-friendly raw materials,

these tyres are made from silica based tread compounds. The tyres also

offer higher durability as compared to normal radials and offer better

resistance against cuts - thanks to its superior compounding

technology.

According to the consumer study, Eco Pulse 2009, by the Shelton

Group, product labels are more important than advertising for finding

out about green products. Of course untruthful labels can be illegal by

breaking Fair Trade Commission Standards or considered to be green

washing by consumers, so creating an affective label can be a tricky

task.

Buildings have a profound impact on the environment, which is why

green-building practices are becoming the norm of the day. Real estate

developers, architects and the public are increasingly becoming aware

of the green house effect and the benefits of harnessing the limited

natural resources. It is extremely important to reduce and perhaps, one

day, eliminate those impacts. Green buildings bring together a vast

array of practices and techniques to reduce and eliminate their impact

on human health and environment. Effective green buildings are not just

XCVIII
a random collection of environment friendly technologies. They require

careful and systematic attention to the full life cycle impacts of the

resources, the resource consumption, and pollution emissions over a

building’s complete life cycle. As a society, we, in India, are more

conscious and sensitive to the impact of thoughtless over-exploitation

of our resources on environment. This awareness is thanks to our

culture, heritage and traditions brought forth with the Vaastu science,

which is as old as our civilization. Green design is a philosophy of

designing a building that is in harmony with the natural features and

resources surrounding the site. There are several key steps in

designing sustainable green buildings, such as, ‘green’ building

materials are obtained from local sources that reduce loads, optimizes

systems, and generate on-site renewable energy. Building materials

considered to be ‘green’ include products that are reusable, renewable,

non-toxic, and/or recyclable. Building materials should be extracted and

manufactured near the building site to minimize the energy wasted in

their transportation.

To lessen the energy loads within and on the structure, it is critical to

orient a building to take advantage of the cooling breeze and sunlight.

Day lighting with ample windows will eliminate the need to turn on

electric lights during the day. These buildings also harvest solar energy

with 20% of their energy requirement coming from solar cells. Solar

XCIX
energy can warm a building in winter. Prevailing breeze and convection

currents can passively cool a building in summer. Usage of thermal

mass can help store the heat gained during the day and release it at

night, thereby minimizing the swings in temperature. Thermal mass can

also both heat a building in winter and cool it during summer. Insulation

is the final step to optimizing a structure. Well-insulated windows,

doors, and ceilings and walls help reduce energy loss, thereby reducing

energy usage.

SOME INTERNATIONAL CASE STUDIES

PHILIPS- EARTHLIGHT: AN EARLY EXPERIMENT IN GREEN

MARKETING

In 1994, Philips launched the “EarthLight,”a super energy-efficient

compact fluorescent light (CFL) bulb designed to be an environmentally

preferable substitute for the traditional energy-intensive incandescent

bulb. The CFL’s clumsy shape, however, was incompatible with most

conventional lamps, and sales languished. After studying consumer

response, Philips reintroduced the product in 2000 under the name

“Marathon,” to emphasize the bulb’s five-year life. New designs offered

the look and versatility of conventional incandescent light bulbs and the

promise of more than $20 in energy savings over the product’s life span

compared to incandescent bulbs. Philips Lighting's first shot at

marketing a standalone compact fluorescent light (CFL) bulb was Earth

C
Light, at $15 each versus 75 cents for incandescent bulbs. The product

had difficulty climbing out of its deep green niche. The company re-

launched the product as "Marathon," underscoring its new "super long

life" positioning and promise of saving $26 in energy costs over its five-

year lifetime. Finally, with the U.S. EPA's Energy Star label to add

credibility as well as new sensitivity to rising utility costs and electricity

shortages, sales climbed 12 percent in an otherwise flat market.

THE HEWLETT-PACKARD COMPANY

The consumer electronics sector provides room for using green

marketing to attract new customers. One example of this is HP's

promise to cut its global energy use 20 percent by the year 2010. To

accomplish this reduction below 2005 levels, The Hewlett-Packard

Company announced plans to deliver energy-efficient products and

services and institute energy-efficient operating practices in its facilities

worldwide.

Car-sharing services address the longer-term solutions to consumer

needs for better fuel savings and fewer traffic tie-ups and parking

nightmares, to complement the environmental benefit of more open

space and reduction of greenhouse gases. They may be thought of as a

"time-sharing" system for cars. Consumers who drive less than 7,500

miles a year and do not need a car for work can save thousands of

dollars annually by joining one of the many services springing up,

CI
including Zip Car (East Coast), Flex Car (Washington State), and Hour

Car (Twin Cities)

COKE INC

Coke's campaign broadens the definition beyond environmentalism,

centering on the concept of "sustainable well-being." The first two

executions, for example, don't focus at all on environmentalism and

instead paint the soft-drink giant as a corporate good guy concerned

with meeting consumer needs and supporting worthy local education

and sports programs.

MCDONALD

McDonald's restaurant's napkins, bags are made of recycled paper.

RECYCLING NEWSPAPER IN TAIWAN

An eco-conscious couple in Taiwan has opened a small schoolhouse

built with donated newspapers fed through a homemade blender.

Canadian-born John Lamorie and his Taiwanese wife, Shelly Wu, used

more than 1,000 kg of newspapers, many collected from students who

would turn them over for points in class, to build the 75 sq-metre

schoolhouse. The project took about a year, with school now set to

open ahead of schedule news of the unusual construction method

spreads in the rural area of Pingtung County. Papercrete, though

patented in 1928, remains far outside the mainstream of construction

materials. It can be labour intensive and tough to use despite its

CII
environmental friendliness. The schoolhouse’s walls are coated with a

silicone coating to guard against rain damage. The school can

accommodate about 16 students.

SILICON-AIR BATTERY

In Washington scientists at the Technion-Israel Institute of Technology

have developed a new, environmentally friendly silicon-air battery

capable of supplying non-stop power for thousands of hours without

needing to be replaced. Created from oxygen and silicon, such batteries

would be lightweight, have an unlimited shelf life, and have a high

tolerance for both humid and extremely dry conditions. Potential uses

include medical applications (for example, powering diabetic pumps or

hearing aids), sensors and microelectronics structured from silicon.

Silicon-air batteries would be able to provide significant savings in cost

and weight because they lack the built-in cathode used in conventional

batteries.

IBM

Project Big Green, an IBM service initiative is aimed at building and

redesigning datacenters that consume less energy. With the launch of

its second phase of the project, the team from IBM Global Technology

Services (GTS) is now targeting large corporate customers in India. The

initiative for an average 25,000 square foot data centre, the potential

energy savings should be upwards of 42 percent, which based on the

US energy terms, would equate to a 7,439-tonne reduction in carbon

CIII
emissions per year. IBM claims that the savings for customers are great

in going green, by using IBM technologies such as their blade servers

instead of other vendor's technologies, a customer with a 25,000-

square-foot data center should be able to save as much as 42 percent

on energy consumption.

VIDEOCON

The Videocon Group has embarked upon a massive re-branding

exercise in order to position itself as a ‘younger, fresher, eco-friendly

and a ‘with-it’ brand; ahead of its foray into diverse areas such as DTH

and telecom. As a first step towards the revamp, the conglomerate has

unveiled a new logo, designed by Inter brand Singapore. The new ‘V’ is

a more fluid version of the erstwhile logo and comprises two green lava-

like shapes. The two animated characters have been named ‘Chouw’

and ‘Mouw’ and the agency has conceptualized a series of five films,

each telling a simple story while reinforcing the brand’s new positioning

statement, “Experience Change.” For instance the first film titled ‘Hot’

shows the two characters flying up to the cloud and making it burst to

help water a flower that is drying up.

Green Telecom India 2010 to promote Greener Initiatives in

Indian Telecom Industry

Energy consumption is one of the leading drivers of operating expenses

for both fixed and mobile network operators. Reliable access to

electricity is limited in many developing countries that are currently the

CIV
high-growth markets for telecommunications. At the same time, many

operators have adopted corporate social responsibility initiatives with a

goal of reducing their networks' carbon footprints, and network

infrastructure vendors are striving to gain competitive advantage by

reducing the power requirements of their equipment. According to an

industry report, all of these factors will continue to converge over the

next several years, and 'green' network equipment will grow to

represent 46% of the $277 billion global telecom infrastructure market

by 2013.

INITIATIVES IN WASTE MANAGEMENT IN INDIA

About 40 million tonnes of municipal waste is generated in India every

year. The waste management scenario continues to be grim, even

though there have been some commendable initiatives by scattered

municipalities, individuals, groups and NGOs. As of today, open dumps

are the major mode of waste disposal. Composting, biomethanation and

thermal processing are being attempted as the options for waste

processing.

Municipal solid waste (MSW) includes household garbage and rubbish,

street sweeping, construction and demolition debris, sanitation

residues, trade and non hazardous industrial refuse and treated bio-

medical solid waste. The management of MSW is an area of universal

concern for both the developed and developing world. It is a major

CV
problem in Indian cities and towns with the urban areas of India

producing about 40 million tons of solid waste from household and

commercial activities every year. As the Solid Waste Management

(SWM) is of local nature it is the responsibility of the State which in turn

has entrusted it to local authorities who carry out the solid waste

management in areas under their control using mostly their own funds,

staff and equipment. The urban local bodies spend approximately

Rs.500 to Rs.1500 (approx. USD 12 - 36) per tonne on solid waste for

collection, transportation, treatment and disposal. About 60-70% of this

amount is spent on collection, 20-30% on transportation and less than

5% on processing and final disposal. Out of the total municipal waste

collected, about 94% is disposed by open dumping and the rest is

composted (Visvanathan et al.,2004).

The 2001 Census has put the number of urban centres as 5144 out of

which 464 centres have a population greater than 1 lakh. According to

the Central Pollution Control Board(CPCB) the average waste generated

for small towns is 0.1 kg per person per day; for medium towns/city is

0.3 to 0.4 kg per person per day; and for large cities around 0.5 kg per

person per day (CPCB, 2000). The typical rate of increase of waste

generation in Indian cities has been estimated at around 1.3% annually.

The expected generation of Lesson from Municipal Solid Waste

Processing Initiatives in India International Symposium MBT 2007 IN -

www.wasteconsult.de 9 3

CVI
MSW in 2025 will therefore be around 700 grams per capita per day.

Considering that the urban population of India is expected to grow to

45% of total from the prevailing 28%, the magnitude of problem is likely

to grow to even larger proportions (World Bank, 2006).

The socio-economic structure of the Indian society not only makes per

capita generation of waste much less compared to that of the western

societies, it has also brought in a system of waste recycling and reusing

not common in developed societies, though these systems are fast

loosing ground. A substantial amount of MSW is recycled and reused

through the primary intervention of ragpickers and second-hand

markets, though there are problems like the health hazard to the

ragpickers and the degradation and devaluation of the recyclables.

Since the experience in the towns all over India regarding waste

processing has not been encouraging and since the States were not

observed to take any specific initiative in this regard various

committees were appointed by the Central Government and as a result

of these committees various projects were initiated. The two leading

methods of waste processing being adopted in India include

composting (aerobic composting, anaerobic, vermicomposting, etc.)

and waste-to-energy (bio-methanation, pelletisation, incineration)

(CPHEEO,2000). The larger (50-60%) proportion of organic matter in

Indian MSW indicates the desirability of biological processing of

wastes. This paper is aimed at analyzing the performance of these

CVII
waste processing plants on technical aspects (i.e. processing

technology and quality of product), the type of management and

performance, institutional aspects (i.e. government policies and

regulations, stakeholder cooperation) and environmental health

aspects. This also includes aspects such as the technology maturity,

input quality/ quantity flexibility and local availability of technology and

expertise.

Some more Initiatives

Hotel offers free meal to guests who are willing to generate electricity.

The Crown Plaza Hotel in Copenhagen, Denmark , is offering a free meal

to any guest who is able to produce electricity for the hotel on an

exercise bike attached to a generator. Guests will have to produce at

least 10 watt hours of electricity - roughly 15 minutes of cycling for

someone of average fitness. They will then be given meal vouchers

worth $36 (26 euros).

Disco pub gets electricity produced by people dancing at specially

modified dance floo . All the flashing strobes and pounding speakers at

the dance club are massive consumers of electrical power. So Bar

Surya, in London, re-outfitted its floor with springs that, when

compressed by dancers, could produce electrical current that would be

stored in batteries and used to offset some of the club's electrical

burden. The club's owner, Andrew Charalambous, said the dance floor

can now power 60 percent of the club's energy needs.

CVIII
 Company creates a desktop printer that doesn't use ink nor paper .

Different from conventional printers, PrePeat adopts a thermal head to

print on specially-made plastic sheets. These plastic sheets are not

merely water-proof, but could be easily erased, just feed the sheets

through the printer again, and a different temperature will erase

everything or just write over it. Also claimed by the manufacturer, such

one sheet could be used up to 1,000 times so that you'll reduce your

expenses on paper for sure.

University constructs a green roof as a gathering place Green design

is an enormously popular trend in modern architecture, just take a look

at this amazing green roof at the School of Art, Design and Media at

Nanyang Technological University in Singapore . This 5-story facility

sweeps a wooded corner of the campus with an organic, vegetated form

that blends landscape and structure, nature and high-tech and

symbolizes the creativity it houses. The roofs serve as informal

gathering spaces challenging linear ideas and stirring perception. The

roofs create open space, insulate the building, cool the surrounding air

and harvest rainwater for landscaping irrigation. Planted grasses mix

with native greenery to colonize the building and bond it to the setting.

Designer creates a sink that uses wasted water to grow a plant . Made of

polished stained concrete, the Zen Garden Sink has a channel that

allows the water used while washing your hands to water a plant.

CIX
Created by young Montreal designer Jean-Michel Gauvreau the sink

comes in single or double basin model. The sink is designed in a way

you won't get your plants all soapy. There is a main drain at the bottom

of the basin for soapy grime. Your little plant friend just gets whatever

you choose to dole out.

Designer creates a shower that forces you to leave when you've wasted

too much water. 20% of our total domestic energy usage is from hot

water for showering and bathing. That's over 6 times the energy usage

of domestic lighting. So designer Tommaso Colia came up with his eco-

friendly shower design that will force you to get out when you take too

long and waste much water. The eco_drop shower features beautiful

concentric circles that will rise to force you to stop showering when you

take too long, and accordingly save water.

Designer creates light-switch that changes colors to teach children how

to save energy. Teaching the importance of energy conservation is the

goal of this design from Tim Holley. He calls it Tio, and it's a ghost-

shaped light switch that gives kids a visual reminder of how much

energy they've used by leaving lights on. Tio starts out green and

smiling. If the light is left on for more than four hours, he turns yellow

and looks shocked. And if you dare to leave that light on for more than

eight hours, sweet little Tio turns into a raging red hulk, complete with

frowny mouth and angry eyes. But he won't just visually remind your

kids about their energy habits; information from the light switch is sent

CX
to Tio's computer program so the entire family can see how they're

doing. In a brilliant piece of visual positive reinforcement, Holley's

program lets kids grow a virtual tree which gets bigger and healthier the

more energy they save.

Environmental company creates a staple-free stapler to avoid staple

pollution. Staples are supposed to be so bad to the environment that a

company decided to create a staple-free stapler. This product promises

to make collation eco-friendly. Instead of using those thin metal planet-

killers, the staple-free stapler "cuts out tiny strips of paper and uses the

strips to stitch up to five pieces of paper together." You can even order

them customized with your corporate logo so you can, you know, brag

about what your company is doing to stop the staple epidemic.

Designer creates an iPhone charger powered by a hand grip A green

idea that gives you a great hand workout as well.

CXI
 CHAPTER- 5

OBJECTIVE OF THE

STUDY AND

RESEARCH

METHODOLOGY

CXII
 CHAPTER-5

OBJECTIVE OF THE STUDY AND RESEARCH

METHODOLOGY

In order to position their green product offerings, companies must first

segment the market according to levels of pro-environmental purchase

behaviour and then target the “greener” consumer segments. However,

a review of the literature indicates that socio-demographic and

personality indicators have had only limited success in profiling

consumers according to their proenvironmental purchasing behaviour.

The demand for green products has been shown to be uneven across

different market segments. Thus, for organizations to position green

products, or communicate their environmental efforts, to members of

the population who are likely to be concerned about environmental

issues, green consumer segments need to be identified.

This research work aims to illustrate how the ‘green challenge’ is

exerting an influence on current marketing practice and how its

implications will require a more profound shift in the marketing

paradigm, if marketers are to continue delivering customer satisfaction

at a profit throughout this new millennium.

CXIII
The study is empirical in nature and has been designed to find out the

consumer perception of the green products and the factors that affect

their purchasing behaviour for the green products. OBJECTIVE OF THE

STUDY

The objective of the present study is –

To determine the factors affecting Green purchasing behaviour among

Indian consumers

To determine most important and least important factors affecting green

purchasing behaviour.

To give recommendations and suggestions to increase the uptake of

green products in India.

RESEARCH METHODOLOGY

Development of Questionnaire

The questionnaire was designed by consulting many studies to

understand the various constructs for the designing of the

questionnaire (Kaman Lee, 2008;) and by conducting a brain storming

session on factors affecting Green purchase behavior in India with 120

students and faculty members of a management institute. Many factors

have been identified such as ecological awareness, social responsibility

towards environment, health awareness, stressful life, promotion of

green products, presence, packaging, eco-certification etc. Based upon

these various factors a framework has been developed.

CXIV
FRAMEWORK FOR FACTORS AFFECTING

GREEN PURCHASE BEHAVIOUR IN EMERGING

ECONOMIES

Studies by Samli (1992) and Miller (1993) both concluded demographics

were an important variable in green product purchase behavior. Roberts

(1996) found that older females with higher education tended to be

greener. Women appeared to be less aware of environmental issues

compared with men (Mohamed M. Mostafa, 2007) This leads to our first

proposition:

Pl: Demographics relate to green consumer behavior. Specifically,

higher incomes and levels of education, as well as other demographic

factors such as gender, are more likely to lead to green purchases than

lower levels of education and income

Green purchases are facilitated by positive attitudes of consumers

toward (a) environmental protection, (b) fair trade, (c) local products,

and (d) availability of action-related knowledge (Tanner C & Kas, 2007)

which in turn affects firms’ operational and commercial performance

and influence their economic results. (Andre et al., 2008). Social

influence was the top predictor of green purchasing behaviour ( Kaman

Lee, 2008).

Social responsibility has been considered as an important influencing

variable for green purchase behaviour (Gerpott & Mahmudova, 2010).

CXV
Lifestyle or status symbol also influences the purchase decision. (

Griskevicius, Tybur,& Bergh, 2010)

This leads to our second proposition:

P2: Environmental awareness relate to green consumer behavior.

Specifically, social responsibility, concern for health and environment,

eco-buying attitude, social awareness more likely to lead to green

purchases.

Consumers are expecting greater corporate environmental activism

and that green promotion is obviously an effort to convince the

consumer of the firm’s commitment to environmental issues, it is

important to understand the factors that contribute to the consumer’s

perception of green marketing. D’Souza et al. (2006) identify six factors:

1) perception of the company as a whole,

2) compliance with environmental regulation,

3) perception of the relationship between price and quality,

4) perception of the product characteristics,

5) product labeling, and

6) previous consumer experience with the company or

product. This leads to our third proposition:

P3: Market presence and promotion relate to green consumer behavior.

Specifically, green packaging, price, promotion and availability more

likely to lead to green purchases

CXVI
Framework for Factors Affecting Green Purchase

Behaviour

MARKETING
AWARENESS ASPECT
ASPECT
1. Concern for health and

environment 1. Product
2. Eco buying attitude 2. Price
3. Social Responsibility 3. Promotion
4. Eco authenticity 4. Place
5. Social awareness and

DEMOGRAPHIC ASPECT

1. Age,
2. Gender
3. Family dimension GREEN PURCHASE
4. Education
5. Occupation BEHAVIOUR
6. Income

CXVII
Based on the above framework a questionnaire was designed with 640

questions. Based on the face validity and repeatability the number of

questions was reduced to 150.

The questionnaire was divided into three parts-

Environmental awareness

Eco purchasing behaviour

Demographic profile

A pilot testing was done with these 150 questions and finally an

instrument of 43 questions was developed. A five point likart scale was

used to collect the responses. Data has been collected from 695

respondents from various parts of Mumbai and Navi Mumbai.

CXVIII
 CHAPTER-6

PROFILE OF THE

RESPONDENTS

CXIX
 CHAPTER- 6

PROFILE OF THE RESPONDENTS

The survey for the research work was conducted in the city of Mumbai

and Navi Mumbai keeping in mind that Green Marketing is still a metro

phenomenon in the developing economies like India. A sample of 1000

respondents was selected randomly for the survey. Out of which only

694 questionnaires were found completely filled hence considered for

the study.

AGE OF THE RESPONDENTS

From the table 6.1 it is evident that out of the total 649 respondents,

more then 27% are below 25 years of age group, maximum i.e. 39% are

from age group of 26 years to 35 years. Nearly 20% are from the age

group of 36 years to 45 years and rest of the 15% is from age group of

46 years and above.

CXX
 Table 6.1- AGE OF THE RESPONDENTS

Age of the Respondents Frequency Percent

Up to 25 189 27.2

26-35 267 38.5

36-45 135 19.5

46 and above 103 14.8

Total 694 100

CXXI
Figure 6.1 - AGE OF THE RESPONDENTS (Bar Chart)

QUALIFICATION OF THE RESPONDENTS

From the table 6.2 it is evident that out of total 694 respondents, 56%

are graduate and 24% are post graduate where as only 20% are SSC and

HSC passed which clearly indicates the high literacy ratio in the metro

areas.

CXXII
Table-6.2: QUALIFICATION OF THE RESPONDENTS

Qualification Frequency Percent

SSC 30 4.3

HSC 109 15.7

Graduate 390 56.2

PG and above 165 23.8

Total 694 100

WORKING STATUS OF THE RESPONDENTS

CXXIII
From the table 6.3 it is evident that out of total 694 respondents, 73% are

working and 27% are nonworking respondents

Table 6.3: WORKING STATUS OF RESPONDENTS

Professional Status Frequency Percent

Working 506 72.9

Nonworking 188 27.1

Total 694 100

Figure 6.3: WORKING STATUS OF RESPONDENTS

CXXIV
GENDER OF THE RESPONDENTS

From the table 6.4 it is evident that out of total 694 respondents, 60% are

male respondents and 40% are female respondents.

Table-6.4: GENDER OF THE RESPONDENTS

CXXV
 Gender Frequency Percent

Male 416 59.9

Female 278 40.1

Total 694 100

Figure- 6.4: GENDER OF THE RESPONDENTS

Gender

Male
Female

CXXVI
 CHAPTER-7

FACTORS AFFECTING

GREEN MARKETING IN

INDIA

CXXVII
 CHAPTER-7

FACTORS AFFECTING GREEN MARKETING IN

INDIA

Before analyzing consumer buying behaviour, it is necessary to

understand the main factors affecting buying behaviour in the field of

Green Marketing. To understand various factors, we have designed the

questionnaire and collected the responses on a five point scale. Based

on the fact that there are differences between individuals in regard to

their pro-environmental behaviour and attitudes, and that the number of

variables used in this research is quite extensive, an exploratory factor

analysis was used to simplify the interpretation of the variables.

FACTORS AFFECTING GREEN MARKETING

Factor analysis is a statistical method used to

describe variability among observed variables in terms of a potentially

lower number of unobserved variables called factors. In other words, it

is possible, for example, that variations in three or four observed

variables mainly reflect the variations in a single unobserved variable,

or in a reduced number of unobserved variables. Factor analysis

searches for such joint variations in response to unobserved latent

variables. The observed variables are modeled as linear

CXXVIII
combinations of the potential factors, plus "error" terms. The

information gained about the interdependencies between observed

variables can be used later to reduce the set of variables in a dataset.

Factor analysis is related to principal component analysis (PCA) but

not identical. Because PCA performs a variance-maximizing rotation of

the variable space, it takes into account all variability in the variables. In

contrast, factor analysis estimates how much of the variability is due to

common factors ("communality"). The two methods become essentially

equivalent if the error terms in the factor analysis model can be

assumed to all have the same variance.

In order to carry out the factor analysis, the principal components

method was used to extract the factors. The variables were grouped into

eleven factors and, all together, account for 53.43 per cent of the total

variance. In order to facilitate the understanding and interpretation of

the results, the factors were rotated using the Varimax method. The

description of the factors is shown in Table 7.I.

As can be seen, according to the score obtained in the Kaiser-Meyer-

Olkin measure, the results of the analysis can be considered excellent

(Kaiser, 1974). Bartlett’s test of sphericity has a significance level of

0.000, showing that there is a high degree of correlation between the

variables, which means that the factor analysis was suitable (Hair et al.,

1998).

Table 7.I- Factors affecting Green Marketing

CXXIX
Factor-1 Concern for health and environment Loading

1 Awareness of green product like fuel

0.646
efficient vehicles should be spread

2 I am concerned about me and my family’s

0.747
health

3 The uses of green product can save our

0.705
earth

4 Consumption of green products will

0.646
positively affect the environment

5 When I have a choice between two equal

products, I always purchase the one
0.504
which is less harmful to other people and

the environment

6 I am concerned about my environment 0.605

Factor-2 Eco-buying attitude

1 I make every effort to buy paper products

0.636
made from recycled paper

2 I use a low-phosphate detergent (or soap)

0.592
for my laundry

3 I have convinced members of my family or friends

not to buy some products which 0.533 are harmful

to the environment

4 I try only to buy products that can be 0.636

CXXX
 recycled

5 I promote environmental awareness by

0.618
working in different social campaign

Factor-3 Social Responsibility

1 To save energy, I use public transport as

0.571
much as possible

2 I buy energy efficient household

0.691
appliances

3 I have switched products for ecological

0.542
reasons

Factor-4 Eco-certification

1 I look for eco friendly certification while

0.529
buying any product

2 Quality is the only criteria when I look

0.613
green product

Factor-5 Social awareness and value

1 I get value for money while buying Green

0.588
Product

2 There are campaigns to provide

0.711
awareness of saving environment

3 Now a day’s people are more environment

0.508
friendly then ever

Factor-6 Lifestyle

CXXXI
1
0.696
It is prestigious to buy green products

2 Green products are high quality products 0.593

Factor-7 Absence of marketing

1 The green products are not well promoted

0.737
in the market

2 The green products are not available at

0.571
affordable prices

Factor-8 Promotion

1 I look for good offers to buy green

0.719
products

2 I look for variety while buying eco-friendly

0.612
products

Factor-9 Brand consciousness

1 I am not brand conscious for eco friendly

0.7384
products

Factor-10 Indifferent attitude

1 I usually purchase the lowest priced product,

regardless of its impact on 0.7621 society

2 Since one person cannot have any effect

upon pollution and natural resource 0.6227

problems, it doesn't make any difference

CXXXII
 what I do

Factor-11 Packaging

1 Packaging attracts me to buy green

0.703
products

Kaiser-Meyer-Olkin Measure of Sampling

.891
Adequacy.

Bartlett's Test of Sphericity, Sig. .000

Kaiser criterion: The Kaiser rule is to drop all components with eigen

values under 1.0.

IMPORTANCE OF VARIOUS FACTORS AFFECTING GREEN

MARKETING IN INDIA

As clear from Table 7.1, there are total 11 factors affecting green

purchase behaviour according to this study. Further as a market person,

we are interested in understanding the importance of these factors as

per customer ratings on various factors.

To understand the importance of each factor as per respondents rating

we have calculated the mean values of all the 11 factors and standard

deviation.

Table 7.2: Importance of Factors affecting green marketing

S.No Factors Mean Std.

CXXXIII
 Deviation

Concern for health and

1 environment 3.88 0.82

2 Eco buying attitude 2.99 0.86

3 Social Responsibility 3.21 0.90

4 Eco certification 3.27 0.99

Social awareness and

5 value 3.41 0.89

6 Lifestyle 3.25 1.04

7 Absence of marketing 3.29 1.03

8 Promotion 3.23 1.02

9 Brand consciousness 2.53 1.24

10 Indifferent attitude 2.50 1.02

11 Packaging 3.61 1.19

Result from Table-7.2 showed that Concern for health and environment

was considered as most important factor by the Indian consumers in

green purchasing behaviour, followed by packaging as the second, Eco-

certification as the third, and Lifestyle as the fourth most important

factor while Indifferent attitude is considered as least important factor,

followed by brand consciousness and eco-buying attitude.

CXXXIV
FACTOR AFFECTING GREEN MARKETING BY

DEMOGRAPHICS

As a marketer it is important for us to understand the demand of the

different segment so as to capture the market share. For the purpose we

have analysed the important factors of green marketing on

demographics i.e age, qualification and gender.

FACTOR AFFECTING GREEN MARKETING BY AGE

Analysis of table 7.3 showed that across the age groups up to 25 years,

26-35 years, 36-45 years and 46 years and above ‘concern for health and

environment’ is the most important factor affecting their buying

behaviour for green products. The second most important factor

‘Packaging’ is also across the age group. ‘Social awareness and values’

is third most important factor for age group up to 45 years while eco-

certification is important for age group more then 45 years.

While indifferent attitude is least preferred by age group upto 35 years

branding is least preferred by 35 years and above.

Table 7.3: Factor Affecting Green Marketing By Age

CXXXV
 Up to 25 26-35 36-45 46 and
Factors Years yrs yrs above

Concern for health and

environment 3.90 3.95 3.84 3.73

Eco buying attitude 2.87 3.06 2.99 3.01

Social Responsibility 3.01 3.32 3.31 3.16

Eco certification 3.15 3.31 3.33 3.32

Social awareness and

value 3.37 3.45 3.41 3.38

Lifestyle 3.28 3.29 3.21 3.16

Absence of marketing
3.20 3.34 3.35 3.23

Promotion 3.36 3.24 3.23 2.98

Brand consciousness
2.66 2.57 2.33 2.44

Indifferent attitude 2.59 2.46 2.41 2.52

Packaging 3.55 3.77 3.44 3.52

CXXXVI
 Packaging

Indifferent
attitude

Brand
consciousness

Promotion

Absence of
marketing

46 and above

Lifestyle 36-45 yrs

26-35 yrs
Up to 25 Years

Social
awareness and
value

Eco
certification

Social
Responsibility

Eco buying
attitude

Concern for
health and
environment

0 1 2 3 4 5

CXXXVII
FACTOR AFFECTING GREEN MARKETING BY QUALIFICATION Analysis

of table 7.4 showed that across the qualification groups HSC,

Graduation, PG and above ‘concern for health and environment’ is the

most important factor affecting their buying behaviour for green

products but for SSC it is ‘Social awareness and values’. The second

most important factor ‘Packaging’ is also across the qualification HSC,

graduation and PG and above. While for qualification upto SSC it is

‘concern for health and environment’.

While indifferent attitude is least preferred by qualification groups HSC,

Graduation, PG and above branding is least preferred by consumers

having qualification upto SSC..

CXXXVIII
Table 7.4: Factor Affecting Green Marketing By Qualification

PG and

Factors SSC HSC Graduate above

Concern for health and

environment 3.67 3.63 3.98 3.84

Eco buying attitude 3.10 2.80 3.00 3.06

Social Responsibility 3.59 2.94 3.22 3.29

Eco certification 3.22 3.02 3.30 3.36

Social awareness and value 3.71 3.16 3.46 3.41

Lifestyle 3.32 3.26 3.32 3.08

Absence of marketing 3.30 3.26 3.27 3.36

Promotion 3.30 3.15 3.33 3.04

Brand consciousness 2.13 2.58 2.59 2.42

Indifferent attitude 2.30 2.56 2.48 2.52

Packaging 3.60 3.48 3.66 3.57

CXXXIX
 Packaging

Indifferent
attitude

Brand
consciousness

Promotion

Absence of
marketing

PG and above

Lifestyle Graduate

HSC

SSC

Social
awareness and
value

Eco
certification

Social
Responsibility

Eco buying
attitude

Concern for
health and
environment

0.00 1.00 2.00 3.00 4.00 5.00

CXL
FACTOR AFFECTING GREEN MARKETING BY GENDER

Analysis of table 7.6 showed that for both male and female respondents

‘concern for health and environment’ is the most important factor

affecting their buying behaviour for green products. The second most

important factor is ‘Packaging’. ‘Social awareness and values’ is third

most important factor for both the gender. Indifferent attitude is least

preferred by both males and females.

Table 7.4: Factor Affecting Green Marketing By Gender

Factors Male Female

Concern for health and environment 3.83 3.96

Eco buying attitude 3.02 2.95

Social Responsibility 3.24 3.16

Eco certification 3.20 3.37

Social awareness and value 3.41 3.41

Lifestyle 3.21 3.31

Absence of marketing 3.29 3.29

Promotion 3.28 3.16

Brand consciousness 2.58 2.45

Indifferent attitude 2.54 2.43

Packaging 3.53 3.73

CXLI
 Packaging

Indifferent
attitude

Brand
consciousness

Promotion

Absence of
marketing

Female
Lifestyle
Male

Social
awareness and
value

Eco certification

Social
Responsibility

Eco buying
attitude

Concern for
health and
environment

0.00 1.00 2.00 3.00 4.00 5.00

AWARENESS ABOUT ECO-CERTIFICATION AMONG CONSUMERS

CXLII
Green gap exists around terms such as energy efficiency, energy

conservation, demand response, smart energy and clean energy, and

customers’ understanding, acceptance and perceptions of value around

those terms, according to an EcoPinion survey from EcoAlign, a new

marketing agency launched by the Distributed Energy Financial Group.

The green gap in communications is contributing to a growing

misalignment between customers’ stated intentions, e.g., their desire to

be more green or frugal with energy consumption, and their actual

behavior.

According to the survey most consumers can’t articulate the difference

between the phrases “energy conservation” and “energy efficiency,”

while only 13 percent of respondents thinking energy efficiency has to

do with saving money or cutting down on fuel costs.

CXLIII
UNDERSTANDING OF THE CUSTOMERS FOR ‘GREEN PRODUCTS’ ON

FOLLOWING OPTIONS

Green colored products

Natural / organic products

Recycled / recyclable products

Bio-degradable products

Vegetarian products

Fresh products

Ayurvedic / Herbal products

Healthy products

Products related to Islam

Good quality products

Highly priced products

Energy saving products

Others_____________

CXLIV
 80 74 76
70 63

60 55
50 48
43
40 43 42
30 24 32
20
10
0 3 5

Green Products

Figure 7.5: Understanding Of The Customers for ‘Green Products’

6.19 Analysis of Figure 6.5 shows that ‘Green’ symbolize Healthy to 76%

respondents while natural/ organic to 74% of the total respondents. 63%

and 55% of respondents relate the term to vegetarian and fresh

respectively.

CXLV
UNDERSTANDING OF THE CUSTOMERS FOR ‘GREEN SYMBOL’ ON

FOLLOWING OPTIONS

Vegetarian

Natural / organic

Recycled / recyclable

Ayurvedic / Herbal

Company logo

Fresh

Healthy

Good quality

Highly priced

CXLVI
 Meaning of symbol
4% 0% 9%
10%
Vegetarian
8% 19% Natural / Organic
Recycled / Recyclable
Ayurvedic / herbal
6% Company Logo
Fresh
2%
Healthy
Good quality
42% Highly priced

Figure 7.6: Understanding Of th Customers for ‘Green Symbol’ Analysis

of Figure 7.6 shows that ‘Green symbol’ symbolize high priced product

to 42% respondents while natural/ organic to 19% of the total

respondents.

AWARENESS OF THE CUSTOMERS FOR ‘GREEN PRODUCTS’

PRESENT IN THE MARKET

CXLVII
Figure 7.7: Awareness of the Customers for ‘Green products present in

the market

Analysis of Figure 7.7 shows maximum respondent i.e 36% are not

aware of presence of green products in the market.

CXLVIII
 CHAPTER-7

SUMMARY AND

CONCLUSIONS

CXLIX
 Chapter-7

SUMMARY AND CONCLUSION

There are a number of ‘western’ derived models of buyer behaviour that

research has shown need to be modified when doing business in

developing countries. Different tastes, customs and habits are likely to

result in different preferences. Also the popularity of western luxury

goods among non-western consumers may be due to different factors

such as saving or giving ‘face’ or peer pressure, rather than because of

perceptions of value. These factors explain why people in the

developing countries are brand-conscious, especially for aspirational

reasons.

The model of innovation diffusion for example does not apply uniformly

to all international markets. In many respects this is due to differences

in culture. Different cultures have a different attitude towards the past,

present and the future which in turn impacts on degree of enthusiasm

for adopting new technologies. Also different cultures exhibit different

degrees of individualism and collectivism which influence readiness to

adopt something new or preference to wait until many others have

adopted the technology. Bradley (2003, p.108) shows that in ‘eastern’

countries the response pattern is different to that in the ‘west’ and the

life cycle much shorter.

CL
Another model is Maslow’s hierarchy of needs which show the order in

which needs are satisfied by buyers. Research by Schutte and Ciarlante

(1998, p.93) shows that in Asia not only is the order in which these

needs are satisfied, different but also the needs themselves vary

compared to the ‘west’. The problem with these models is that they view

eastern or Asian markets as being similar and do not differentiate

between groups within such markets on socio economic lines as buyer

behaviour is likely to be markedly different between the wealthy

elite/growing urban middle class on the one hand and the urban

poor/rural masses on the other.

A clever marketer is one who not only convinces the consumer, but also

involves the consumer in marketing his product. Green marketing

should not be considered as just one more approach to marketing, but

has to be pursued with much greater vigor, as it has an environmental

and social dimension to it. With the threat of global warming looming

large, it is extremely important that green marketing becomes the norm

rather than an exception or just a fad. Recycling of paper, metals,

plastics, etc., in a safe and environmentally harmless manner should

become much more systematized and universal. It has to become the

general norm to use energy-efficient lamps and other electrical goods.

Marketers also have the responsibility to make the consumers

understand the need for and benefits of green products as compared to

non-green ones. In green marketing, consumers are willing to pay more

CLI
to maintain a cleaner and greener environment. Finally, consumers,

industrial buyers and suppliers need to pressurize effects on minimize

the negative effects on the environment-friendly. Green marketing

assumes even more importance and relevance in developing countries

like India.

Green marketing covers more than a firm's marketing claims. While

firms must bear much of the responsibility for environmental

degradation, ultimately it is consumers who demand goods, and thus

create environmental problems. One example of this is where

McDonald's is often blamed for polluting the environment because

much of their packaging finishes up as roadside waste. It must be

remembered that it is the uncaring consumer who chooses to disposes

of their waste in an inappropriate fashion. While firms can have a great

impact on the natural environment, the responsibility should not be

theirs alone.

It appears that consumers are not overly committed to improving their

environment and may be looking to lay too much responsibility on

industry and government. Ultimately green marketing requires that

consumers want a cleaner environment and are willing to "pay" for it,

possibly through higher priced goods, modified individual lifestyles, or

even governmental intervention. If you think customers are not

concerned about environmental issues or will not pay a premium for

products that are more eco-responsible, think again. You must find an

CLII
opportunity to enhance you product's performance and strengthen your

customer's loyalty and command a higher price.

Until this occurs it will be difficult for firms alone to lead the green

marketing revolution. It must not be forgotten that the industrial buyer

also has the ability to pressure suppliers to modify their activities.

Thus an environmental committed organization may not only produce

goods that have reduced their detrimental impact on the environment,

they may also be able to pressure their suppliers to behave in a more

environmentally "responsible" fashion. Final consumers and industrial

buyers also have the ability to pressure organizations to integrate the

environment into their corporate culture and thus ensure all

organizations minimize the detrimental environmental impact of their

activities. Green marketing is still in its infancy and a lot of research is

to be done on green marketing to fully explore its potential.

CONTRIBUTION OF GREEN MARKETING

First and foremost, a good green marketing program is one that either:

adds renewables that would not already be added or supports

renewable projects that might not otherwise continue to operate. If

these things are already happening and being paid for by all, then the

program doesn't meet the bottom-line test: green marketing programs

must make a difference.

2) A sign of a good green marketing program is one that has strong

links to local environmental groups and that achieves broad support

CLIII
among regional and national groups with an interest in promoting

renewable power. Public Service of Colorado, for example, has

developed a close working partnership with the Land and Water Fund

and other environmental groups in the state.

3) A green marketer that is seriously interested in greening the electric

system will have a program that is linked to a larger vision and a

strategic plan for making renewables an increasingly larger part of the

generation mix. A good example of this is Central and Southwest's

recent decision to acquire a significant amount of renewables capacity,

with the intent of rate basing a good portion of it, and subscribing the

rest through a green pricing program.

4) For green marketing programs to be successful in the long run, they

should both improve the environment and be fair to consumers. Prices

should not be excessively higher than the actual cost of the resources

in the portfolio. This is particularly true for green pricing programs,

which are scrutinized by regulators, and in imperfectly competitive

markets, because in these cases, there is no real competition in the

green market. In markets that are vibrantly competitive and in which

consumers have good information, this is less of a problem since lower-

cost providers can compete to displace those providers charging

excessive prices.

CLIV
Green marketing is offering a number of significant

benefits to Indian Market:

10. Marketers get access to new markets and gain an advantage over

competitors that are not advocating “greenness.”

11. Marketers can charge a premium on products that are seen as more

eco-responsible.

12. Organizations that adopt green marketing are perceived to be more

socially responsible.

13. Green marketing builds brand equity and wins brand loyalty among

customers.

14. However, green marketing poses huge dangers for marketers if they

get it wrong:

15. Most customers choose to satisfy their personal needs before

caring for the environment.

16. Overemphasizing greenness rather than customer needs can prove

devastating for a product.

17. Many customers keep away from products labeled “green” because

they see such labeling as a marketing gimmick, and they may lose trust

in an organization that suddenly claims to be green.

CLV
18. Green marketers need to find out the value their customers place on

green benefits. It is important that they position the product on the

basis of the functional need it caters to and then talk about the

additional benefits of greenness.

19. Marketers need to find out whether, by adopting green marketing,

their organizations will be perceived as more socially responsible. They

need to know whether their customers understand the benefits of green

products and value them enough. If they do not, then the marketers may

also need to invest in customer education in order to make their

marketing efforts successful.

Green marketing is still in its infancy and a lot of research is to be done

on green marketing to fully explore its potential. Green marketing

should not neglect the economic aspect of marketing. Marketers need to

understand the implications of green marketing. Marketers also have

the responsibility to make the consumers understand the need for and

benefits of green products as compared to non-green ones. In green

marketing, consumers are willing to pay more to maintain a cleaner and

greener environment. Finally, consumers, industrial buyers and

suppliers need to pressurize effects on minimize the negative effects on

the environment-friendly. Green marketing assumes even more

importance and relevance in developing countries like India & Pakistan.

The significance India will have on the the world in the future will be

extraordinary; we’ve only scratched the surface. The thing that remains

CLVI
to be seen is the importance green business has in India. Tackling mass

poverty is the first thing that is happening, and it should be the first

thing that the country emphasizes. India will be an economic

powerhouse, and could be a leader in green business if they choose to

be. The direction that business takes in India will have massive impact

on the world. If business leaders there recognize the vast potential that

green business has, and then decide to invest time, money, and effort,

the world would only benefit. India is in a very unique position right

now, they could either lead the world, or potentially aid in its

destruction.

CLVII
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CLVIII
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Perceptions of Environmental Issues: Relevance to Environmental

Education Curriculum Development", Doctoral Dissertation, Kansas

State University, USA.

CLXII
McEvoy J (1972), "The American Concern With Environment", Social

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& Row, New York.

Mitchell Arnold (1983), The Nine American Lifestyles, Macmillan

Publishing Co. Inc., New York.

Mohai P and Twight B W (1986), "Rural-Urban Differences in

Environmentalism Revisited", Presented at the Annual Meeting of the

Rural Sociological Society, Salt Lake City, Utah, USA.

Riezenstein Richard C, Hills Gerald E and Philpot John W (1974),

"Willingness to Pay for Control of Air Pollution: A Demographic

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Canada, Mexico, United States", A Report on the Study Commissioned

by S C Johnson and Son Inc.

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CLXIII
Schahn Joachim and Holzer Erwin (1990), "Studies of Individual

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CLXIV
Tognacci Louis N, Weigel Russell H, Wideen Marvin F and Vernon David

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CLXV
 ANNEXURE

LIST OF COUNTRIES ANNEX-1 AND ANNEX-2

CLXVI
Annex I Countries

UNFCCC Annex I Countries - (Developed Nations and Nations with

Economies in Transition (EIT))

· Australia ·
· Austria
· Belarus a/
· Belgium
· Bulgaria a/
· Canada
· Croatia*
· Czech Republic a/ *
· Denmark
· European Union
· Estonia a/
· Finland
· France
· Germany
· Greece
· Hungary a/
· Iceland
· Ireland
· Italy
· Japan
· Latvia a/
· Liechtenstein*
· Lithuania

CLXVII
Luxembourg
· Monaco*
· Netherlands
· New Zealand
· Norway
· Poland a/
· Portugal
· Romania a/
· Russian Federation a/
· Slovakia a/*
· Slovenia a/*
· Spain
· Sweden
· Switzerland
· Turkey
· Ukraine a/
· United Kingdom of Great
Britain and Northern Ireland
· United States of America

a/ Countries with Economies in Transition (EIT)

* Countries added to Annex I by an amendment that entered into force

on 13 August 1998,

pursuant to decision 4/CP.3 adopted at COP 3.

UNFCCC Annex II Countries

(Annex I countries without the countries with Economies in Transition

(EIT))

· Australia · Luxembourg

· Austria · Monaco*

CLXVIII
 · Belgium · Netherlands
· Canada · New Zealand
· Croatia* · Norway
· Denmark · Portugal
· European Union · Spain
· Finland · Sweden
· France · Switzerland
· Germany · Turkey
· Greece · United Kingdom of Great Britain
· Iceland and Northern Ireland
· Ireland · United States of America

· Italy

· Japan

· Liechtenstein*

* Countries added to Annex I by an amendment that entered into force

on 13 August 1998,

pursuant to decision 4/CP.3 adopted at COP 3.

(Sources: United Nations Framework of Climate Change Convention

(UNFCCC) and Organisation for Economic Co-operation and

Development (OECD))

CLXIX
The non-annex I countries are the developing countries

CLXX
 QUESTIONNAIRE

Questionnaire

1) Gender

CLXXI
2) Age

3) Education

4) What do you understand from “green products”? (Tick more than one)

a) Green colored products

b) Natural / organic products

c) Recycled / recyclable products

d) Bio-degradable products

e) Vegetarian products

f) Fresh products

g) Ayurvedic / Herbal products

h) Healthy products

i) Products related to Islam

j) Good quality products

k) Highly priced products

l) Energy saving products

m) Others_____________

5. What does the symbol on the right

signify? (Tick any one)

CLXXII
a. Vegetarian

b. Natural / organic

c. Recycled / recyclable

d. Ayurvedic / Herbal

e. Company logo

f. Fresh

g. Healthy

h. Good quality

i. Highly priced

6. Do you consider your effect on the environment as a consumer before

purchasing general day to day products?

a. Yes

b. No

c. Don’t know / Can’t say / Not Sure

7. Do you encourage recycling of products?

a. Yes

CLXXIII
b. No

c. Don’t know / Can’t Say / Not Sure

8. Have you ever sent old or broken household electronic products

(Mobile phone, Television, Refrigerator, Air-conditioned, Car battery.etc) for

recycling?

a. Yes

b. No

9. Are you aware of any products that are designed with environmental

issues in mind? If yes, kindly mention the same.

10. Choose the energy saving electronics from following which are used

by you currently?

(a) CFL Bulb

CLXXIV
(b) Solar water heater

(c) Solar cooker

(d) Solar electric products

(e) Solar mobile

(f) Five star energy saving rated Air - conditioner

(g) Five star energy saving rated Television

(h) Five star energy saving rated Fridge

(i) Electric bike

(j) Don’t know / Can’t say / Not sure

(k) None

11. Have you ever bought or considered buying products which are

designed with environmental issues in mind?

a. Yes

b. No

c. Don’t Know / Can’t say / Not Sure

If No please specify why;

(a) Reduced performance

(b) Products appearance

(c) Too expensive

(d) Aren’t aware of any such products

CLXXV
(e) Other (specify)_____________________________

12. If given a choice, please choose the kind of vehicle from the following

that you’d prefer to own.

(a) Petrol

(b) Diesel

(c) Gas

(d) Electric

(e) Solar

13. What was the reason for your choice?

(a) Low cost of car

(b) Low maintenance

(c) Durability of engine

(d) Eco – friendly

(e) Saving on fuel expenses

(f) Others___________________

(g) Don’t know / Can’t say / Not sure

CLXXVI
New Report: American Consumers Lead the World in

Environmental Skepticism; Consumers Globally

Exhibit Different Attitudes and Behaviors on Green

Living in Five Distinct Population Segments

PR Newswire. New York: Sep 22, 2010.

Abstract (Summary)

The report also identifies five distinct groups of environmental

consumers ranging from the critical, "Jaded" category, who tend to

exhibit the least concern about the environment, to the "Green inDeed,"

the group of consumers who are not only green in their lifestyles but

advocate for others to become environmentally responsible as well.

NEW YORK, Sept. 22 /PRNewswire/ -- The United States is one of the

more environmentally cynical nations in the world with only 62% of the

population believing that environmental pollution is a serious issue

according to the findings from the new Green Gauge Global report from

GfK Roper Consulting, a division of GfK Custom Research North

America. This ranks the US 24th out of 25 markets around the world -

close to dead last.

CLXXVII
The GfK Roper Green Gauge(R) Global report, which examines the

green habits of 36,000 consumers in 25 countries worldwide, found that

American consumers are also skeptical about the cost and efficacy of

green products and their impact on the environment. Approximately two

in three Americans perceive green products to be too costly and one-

third believes they don't work as well as "regular" products.

In the USA, these numbers also represent a dramatic increase from just

two years ago.

"In the US and around the world, marketers are being challenged by

consumers to produce better green products that don't cost too much.

To that end, marketers need to be cognizant of the distinctive

perceptions and attitudes about green products in order to convey

these products as a smart, pragmatic purchase," said Timothy Kenyon,

Director of the GfK Roper Green Gauge study at GfK Custom Research

North America.

The report also identifies five distinct groups of environmental

consumers ranging from the critical, "Jaded" category, who tend to

exhibit the least concern about the environment, to the "Green inDeed,"

the group of consumers who are not only green in their lifestyles but

advocate for others to become environmentally responsible as well.

CLXXVIII
Between these segments lie the "Carbon Cultured," consumers who are

concerned about the environment, yet their green behaviors tend to lag

a bit, as well as the status-seeking "Glamour Greens." "Green in Need"

consumers have the desire, but lack the means to be environmentally

responsible.

"Our Green Gauge Global report not only discusses the unique

elements of each of these population segments, but it also provides

actionable strategies for developing green marketing campaigns and

tailored customer communications in every region across the globe,"

said Kenyon. "Now, more than ever, there is no one-size-fits-all

approach to reach those consumers across the globe who embrace

green behaviors compared to others who are less passionate about the

environment."

As consumer perceptions of green products continue to evolve globally,

marketers should keep in mind that not every consumer is out to

change the world one purchase at a time. However, by understanding

the varying green attitudes and behaviors globally, marketers can more

effectively tailor their communications and strategies to reach their

target audiences.

CLXXIX
CLXXX