Background:
Mankind is highly dependent upon fossil fuels for its ever-increasing energy demands. The future supply is unreliable mainly due to the fact that it is a finite resource which is becoming more and more expensive to produce. As a reaction to this current threat and uncertainty, a mathematical model is developed in this study in order to identify more sustainable quantities. The main objective of this study was to provide companies with a tool to assist in the prevention of overproduction, in other words, to minimize unsalable production quantities and to preserve natural resources.MethodRegression analysis, game theory - Cournot game Results:The study was carried out in cooperation with the Italian company PintInox, S. p. A., located in the Italian region of Lombardia. After the implementation of sustainability measurement metrics into the company's processes and the discovery of a profitable market niche (market principles applying value to sustainable development) for PintInox, S. p. A., a natural grouping (oligopoly) of Italian cutlery producers was identified. Entrance barriers posed by this group (oligopoly) are all kinds of inabilities to prove a verifiable concept of their Corporate Social Responsibility practices. Companies that failed to communicate their commitment regarding sustainable development to their business-to-business (B2B) partners cannot enter this oligopoly and are, consequently, excluded from markets placing value on sustainability principles. Based on economic effectiveness, the marketable output of every oligopoly member was calculated.
Conclusions:
The desire to preserve natural resources is driven by incentives within the marketplace. These incentives were identified through the game theory. The companies firstly concentrate themselves on social responsibility and environmental safety and then, as oligopoly members, on economic effectiveness. The study reconfirms that also the economic dimension plays an important role in a 'triple bottom line' philosophy.
