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

Abstract

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.

Psychrophrynella glaucasp. n., a new species of terrestrial-breeding frogs (Amphibia, Anura, Strabomantidae) from the montane forests of the Amazonian Andes of Puno, Peru

“…These projects are part of many planned dams in the Inambari watershed that threaten to alter fish migrations, biodiversity and geochemical cycles locally and downstream throughout the Amazon basin ( Forsberg et al, 2017 ; Latrubesse et al, 2017 ). These consequences might not have been properly taken into consideration during the decision-making process evaluating financial interests and the findings of the Environmental Impact Assessment ( Rode et al, 2015 ). We hope that the timely description of new species such as P. glauca will contribute to the conservation of these humid montane forests, and promote mitigating solutions including restoration of degraded forest habitat.…”

Navigating Sustainability Embeddedness in Management Decision-Making

“…Even though sustainability has secured its place as a permanent fixture on the management agenda and there is a growing resource base supporting sustainability, it appears that the current state of sustainability embeddedness differs from the expected state. In fact, the absence of knowledge about the current embeddedness situation appears to be hindering the achievement of desired levels of sustainability embeddedness and performance [4,[32][33][34][35]. An implementation gap between actual and desired levels of sustainability embeddedness has been confirmed by the literature and has been described as "problematic" given the importance of sustainability [6,30,36,37].…”

Ecosystem Service Arguments Enhance Public Support for Environmental Protection - But Beware of the Numbers!

“…To non-experts who are unaware of these technical challenges behind valuation studies, the results may convey an illusory completeness, precision, and determinacy (see e. increase the chances that the project will be accepted and to reduce potential compensation payments (Lim 1985, Rode et al 2015. Monbiot (2014) has raised the concern that "the accounting exercise would be used as a weapon by the developers.…”