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Ethical Analysis for Evaluating Sustainable Business Decisions: The Case of Environmental Impact Evaluation in the Inambari Hydropower Project

Author

Listed:
  • Julian Rode

    (Department Environmental Politics, Helmholtz-Centre for Environmental Research—UFZ, Permoserstraße 15, Leipzig 04318, Germany)

  • Marc Le Menestrel

    (Department of Economics and Business, Universitat Pompeu Fabra, Ramon Trias Fargas 25-27, Barcelona 08005, Spain)

  • Luk Van Wassenhove

    (INSEAD, Social Innovation Center, Boulevard de Constance, Fontainebleau Cedex 77305, France)

  • Anthony Simon

    (Avenue du Golf 61, 1640 Rhode-St-Genese, Belgium)

Abstract

We propose an ethical analysis as a method to reflect on how companies’ decisions promote sustainable development. The method proceeds by first identifying the choice according to financial business interests, and by then scrutinizing this choice according to consequentialist and deontological ethics. The paper applies the method to the choice of an Environmental Impact Assessment (EIA) that a consortium of Brazilian companies (EGASUR) delivered as part of their project proposal for the realization of the Inambari hydropower dam in the Peruvian Amazon. We show that if an EIA is chosen based on the attempt to maximize the financial bottom line, it raises ethical issues both from a consequentialist perspective by involving negative consequences for various stakeholder groups, and from a deontological perspective by not complying with relevant rules, guidelines, and principles. The two ethical perspectives hence reveal where the consortium faces impediments to a genuine commitment to sustainability. Building on stakeholder interviews, observations of the project developments, and the executive summary of the actual EIA, we provide indications that EGASUR has indeed made a choice that resembles a decision based on financial interests.

Suggested Citation

  • Julian Rode & Marc Le Menestrel & Luk Van Wassenhove & Anthony Simon, 2015. "Ethical Analysis for Evaluating Sustainable Business Decisions: The Case of Environmental Impact Evaluation in the Inambari Hydropower Project," Sustainability, MDPI, vol. 7(8), pages 1-22, August.
    • Handle: RePEc:gam:jsusta:v:7:y:2015:i:8:p:10343-10364:d:53677
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    References listed on IDEAS

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    1. Rode, Julian & Le Menestrel, Marc, 2011. "The influence of decision power on distributive fairness," Journal of Economic Behavior & Organization, Elsevier, vol. 79(3), pages 246-255, August.
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    Cited by:

    1. Rode, Julian & Le Menestrel, Marc & Cornelissen, Gert, 2017. "Ecosystem Service Arguments Enhance Public Support for Environmental Protection - But Beware of the Numbers!," Ecological Economics, Elsevier, vol. 141(C), pages 213-221.
    2. Catherine Le Roux & Marius Pretorius, 2016. "Conceptualizing the Limiting Issues Inhibiting Sustainability Embeddedness," Sustainability, MDPI, vol. 8(4), pages 1-22, April.
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    4. Liu, Yanyan & Huang, Guohe & Zhai, Mengyu & Wang, Nan & Zheng, Xiaogui & Pan, Xiaojie, 2025. "Development of a factorial hydroengineering equilibrium analysis model for analyzing direct and indirect socio-economic and environmental effects of large-scale hydropower projects," Energy, Elsevier, vol. 333(C).

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