ANALYSE (i) Why did ESL engage in the business of manufacturing smart grid components and hybrid energy storage solutions despite there being no…

(i) Ever-increasing and demanding environmental regulation is forcing companies to change their practices. In many countries, numerous pieces of legislation cover areas such as air quality, climate change, hazardous substances, packaging, waste, and water quality. The trend is very much in the direction of increased and more stringent legislation. Environmental sustainability is not an issue that can be avoided by any organisation. Organisations need to consider how environmental regulation will impact their operations and the cost of doing business. By engaging in the business of manufacturing of smart grid components and hybrid energy storage solutions even in the absence of any statutory compulsion, ESL gained advantages over its rivals. ESL's actions were integral to its own strategic success and instrumental in driving through the subsequent legislation from which the company later benefited. This also helps ESL improve its brand image among stakeholders as responsible corporate citizens. (ii) Organisations increasingly have to demonstrate that they are managing all their risks systematically and responsibly. This includes environmental risks - risks that arise from the impacts of the organisation on the environment. By assessing the environmental risks associated with their activities, processes, products, and services, organisations can identify their potential legal and business exposure. Non-compliances can result in enormous financial impacts such as fines, penalties, legal costs, and damages. Thus, ESL is exposed to environmental risks. (iii) Focusing on environmental sustainability often provides opportunities for reducing costs. For example, reducing carbon emissions typically saves energy costs. Similarly, waste-reduction programmes improve environmental performance while lowering operating costs. Reducing environmental impacts can also reduce or eliminate fines, levies, and other compliance costs. Focusing on environmental sustainability thereby making investments in developing clean technologies and more energy-efficient products and processes will not only save the organization money but could also be patented and/or sold to other organizations, providing an additional source of income. ESL may have carbon credit for efficiency in reducing energy and selling on the open market, thereby actually generating revenue.