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Ecopreneurship

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According to Schaper, Michael “At a very basic level, an ecopreneur is a person or entity which provides environmentally friendly services, goods, and technology such as recycling, green construction, or organic food”

“Ecopreneurs are entrepreneurs whose business efforts are not only driven by profit, but also by a concern for the environment.”

“Ecopreneurship, also known as environmental entrepreneurship and eco-capitalism, is becoming more widespread as a new market-based ap­proach to identifying opportunities for improving environmental quality and capitalising upon them in the private sector for profit.”


What is Ecopreneurship

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The term green entrepreneurship stems from Berle’s (1991) book “The green entrepreneur” Business opportunities that can save the Earth and make you money. As the title suggests, it is a rather practically orient­ed book that touches on topics such as recycling, nature preservation, renewable energy implementation, etc. In his book, Berle (1991) noted how “One man’s garbage is another man’s treasure”.

An interesting observation is that almost all the definitions related to green entrepreneurship are also related to the start-up phase of a company and the ability of the person or the company to align activities with environmental protection. Green entrepreneurs are embracing environmental values as a core component of their identity and seeing them as a competitive advantage of their company in the marketplace.

The importance of concepts like ecopreneurship has to be understood against this background of today’s world’s increasing environmental problems. As will be laid out here, many of the most acute environmental problems are either directly or indirectly caused by human activity, activity which to a large part consists of economic activity. These serious environmental problems warrant a shift towards a more ecologically sustainable economy, a transition in which ecopreneurship may be helpful.

Ecopreneurship is a term coined to represent the process of principles of entrepreneurship being applied to create businesses that solve environmental problems or operate sustainably. The term began to be widely used in the 1990s, and it is otherwise referred to as “environmental entrepreneurship”.

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“Ecopreneurs are entrepreneurs whose business efforts are not only driven by profit, but also by a concern for the environment.”

“Ecopreneurship, also known as environmental entrepreneurship and eco-capitalism, is becoming more widespread as a new market-based ap­proach to identifying opportunities for improving environmental quality and capitalizing upon them in the private sector for profit.”

Although ecopreneurship initiatives can span a wide range of issues from ocean pollution to recycling to food waste, they tend to follow reoccurring environmental principles such as systems thinking, cradle to cradle product design, triple bottom line accounting, etc.

Ecopreneurship Definition

(i) According to Schaper, Michael “At a very basic level, an ecopreneur is a person or entity which provides environmentally friendly services, goods, and technology such as recycling, green construction, or organic food”

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(ii) According to Goliath “Ecology or environmental biology is the branch of biology which takes into consideration the examination of living organisms in the natural environment. It includes the study of individuals, populations, communities, and ecosystems for better business and green business”.

(iii) According to Reuters “The word ecopreneur is a portmanteau of “ecological” and “entrepreneur.” An ecopreneur is an individual who is focused on ecologically-friendly issues and causes, attempting to do business in a way which benefits the environment. He may not be a person or entity only involved in products like solar powered cells, water conservation systems or compostable packaging. In fact, an ecopreneur is anyone who ranks the environment more than or equal to profits as his most effective criteria as a business owner”.


Ecopreneurship Features

According to Schuyler “An entrepreneur whose business efforts are not only driven by profit, but also by a concern for the environment The terms such as “Sustainopreneur”, “environmental Entrepreneur” and “Eco capitalist” are synonymous with ecopreneur.

The features of ecopreneurs are:

  1. They all undertake business ventures which involves a measure of risk
  2. They identify a feasible business opportunity
  3. Their activities have a positive impact on the environment.
  4. The degree of intentionality separates ecopreneurs from accidental entrepreneurs.

Principles of Ecopreneurship with Examples 

The adoption of environmentally responsible business practices can, conceivably, open up an additional range of opportunities for entrepreneurs. The move to a sustainable business framework provides numerous niches that enterprising individuals and firms can successfully identify and service. These include, among other things, the development of new products and services, improvements to the efficiency of existing firms, new methods of marketing and the reconfiguration of existing business models and practices.

However, green entrepreneurship is not only important because it provides new opportunities for the nimble first movers who identify and exploit such opportunities but also because it has the potential to be a major force in the overall transition to a more sustainable business paradigm. In a market-based economy, entrepreneurs play a critical role in the eventual adoption of green business practices by the wider business community through the lead role that they provide to other firms.

By demonstrating the economic benefits that come from being greener, green managers and ecopreneurs act as a pull factor that entices other firms to proactively go green, in contrast to the ‘push’ factors of government regulation and stakeholder or lobby-group pressure.

Following are some of the principles of Ecopreneurship:

 (i) Systems Thinking:

Systems thinking is a core principle to any business concerned with sustainability and the environment. It is an approach to problem solving that studies how something interacts with its environment as a whole, whether that be social, economic or natural. This is in contrast to a linear thinking model, which would isolate a problem and study only its directly related processes to find solutions. It consists of the notion that in order to understand vertical problems one must understand and evaluate the horizontal environment as a whole.

 (ii) Product Design:

A lot of companies using ecopreneurship principles incorporate sustainable product design. Product design incorporating sustainability can happen at any stage of the business, including material extraction, logistics, the manufacturing process, disposal, etc. Sustainable product design can be achieved using innovative technology or Eco-innovation, cradle to cradle design, bio-mimicry, etc. Sustainable product design can encompass the selection of materials, use of resources, production requirements and planning for the final disposition such as recycling, reuse, remanufacturing, or disposal of a product.

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It takes into account the socio-economic circumstances of the company and the opportunity for the firm to address social problems associated with poverty, safety, inequity, health and the working environment. It is not a stand-alone methodology but one that must be integrated with a company’s existing product design so that environmental and social parameters can be integrated with traditional product attributes such as quality, cost, and functionality.

Ways to implement sustainable product design include:

  1. Using fewer materials, finding sustainable material substitutes
  2. Choosing resources whose extraction is not harmful to the surrounding environment and use the most Eco-friendly extraction methods
  3. Reducing material weight or transportation volume
  4. Using production techniques with as little as possible harmful environmental side effects like toxic chemical release, reduce waste and emissions
  5. Using less or reusable packaging, transport and distribute products more efficiently
  6. Reducing energy consumption, using cleaner energy sources like solar panels or wind power.
  7. Improving durability and reliability of product, offer repair services, re-purpose broken or unused products

 (iii) Innovative Technology:

Many companies practicing Ecopreneurship attempt to solve environmental issues either by developing new technology or innovating already existing technologies. The most widespread examples of this are the creation of solar panels and hybrid cars in order to decrease dependency on fossil fuels. Countless other examples from anaerobic digestion food waste systems to portable air purifiers exist. The competitive advantage or core competency for ecopreneurship companies is oftentimes related to a technology they have developed.

 (iv) Cradle to Cradle Design:

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Cradle-to-cradle design is a popular environmental approach to product design that seeks to eliminate waste by designing products that can be continuously re-circulated through our economy. This is contrasted against a “cradle to grave” design which typically includes single use products or products made of multiple different materials that cannot be separated in order to be recycled properly.

Cradle to Cradle design is mimicked after processes in the natural environment which do not create waste but instead every output is an input for another organism. Cradle to Cradle design is often achieved through using environmentally friendly resources which are non-toxic and that can either be recycled into other products or composted.

Another important component of cradle to cradle design is the ability to easily take products apart for better reuse as well as designing with durability in mind. This idea was popularized by the 2002 book Cradle to Cradle: Remaking the Way We Make Things written by William McDonough and Michael Braungart.

(v) Bio-Mimicry:

Bio-mimicry or Biomimetics is a term created by American biophysicist Otto Schmitt that refers to recreating the solutions for problems found in nature. A definition provided by the Institute for Biomimicry is “Biomimicry is an approach to innovation that seeks sustainable solutions to human challenges by emulating nature’s time tested patterns and strategies.”

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Some examples include studying the building of sand mounds by ants in order to create lower cost air circulation for buildings and trains with curved fronts mimicking the beaks of birds to increase speed. Other examples can be found in Janine Benyus’ Ted Talk on biomimicry.

(vi) Triple Bottom Line Accounting:

Triple bottom line Accounting is an accounting method that combines traditional accounting methods of measuring profit with those that measure social and environmental benefits as well. The phrase was created by John Elkington in 1994 at his company Sustainability. Some criticisms have sprung up over what methods are to be used to measure environmental and social impacts.

(vii) Legal Forms:

Ecopreneurs may decide to develop their company under traditional business legal forms like a sole proprietorship or an LLC or they might choose some newer forms. These business forms are popular among the environmentally conscious community for their emphasis on social benefit.

Low-profit limited liability company form of business is available in the USA as of 2013. Low-profit limited liability company or (L3C) is a company that follows the same legal and tax codes as a traditional LLC but has a main goal of increasing social welfare like that of a non-profit organization. We do not have this form available in India.

Advantages of Ecopreneurship

The advantages of ecopreneurship are as follows:

(i) Global Population Growth:

Ecopreneurs realize that as the resources and land area is limited, it is their responsibility to ensure that there are enough resources not only to fulfill the needs of the current population which is growing continuously, but also for the future generations. Hence they should find ways to conserve energy, materials, and resources by developing new technologies or finding ways to control birth rate and finding ways to meet the food and shelter demand for the growing population in order to make sustainability possible.

(ii) Increasing Life Expectancy:

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Ecopreneurs value life, not only their own and of family members, but of the whole humanity. They want everyone to live a longer and healthier life, that is why they develop products and ways to increase life expectancy such as healthier food, purified water etc.

(iii) Climate Change:

Climate shapes the way we live on this planet and the way we live, work and play is changing the climate. The pollutants released in the air due to use of fossil fuels is adversely affecting the climate. In order to sustain the climate, ecopreneurs are involved in finding alternate ways to produce energy such as using wind, water and solar energy.

(iv) Resource Scarcity:

The diminishing natural resources are a great issue as we will be left with no natural resources if we do not sus­tain them. In order to sustain them, ecopreneurs constantly look for alternatives by recycling them or using a cheaper, abundantly avail­able resource if possible.

(v) Lack of Equity in the World:

The people of the world are living in a continuum, with one end which has all the facilities of the world including the best quality food, water and home, while on the other end are people who do not even have the basic necessities of life.

Ecopreneurs want to make sure that every living being in the world is treated equally so that no one is deprived of anything. That is why they are active members of movements such as WTO and also find ways to produce goods and services affordable by everyone. They are also involved in philanthropic acts such as giving charity donations to help the deprived people of the society.


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