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Environmental factors

Watch this video and read this article where we explore environmental factors in a PESTEL analysis.
E-factor in the PESTLE analysis stands for ecology or the environment. Most industries have now got carbon emission targets or zero carbon emission targets beginning from aviation, even universities are being asked to cut their carbon footprint. This would be a determinant of future success where organisations will be judged not only on financial performance but also for environmental performance. Adopting green practices proactively may in a political way put businesses in an advantageous position because as far as ecological regulations are concerned, it is not a matter of if, it is a matter of when.

Environmental factors can focus on ecology or the physical environment, and include concerns over the weather, climate change, environmental policies, pressure from environmental activist groups, air and water pollution, and renewable energy.

The Shell Energy Transition Report

The Shell Energy Transition Report (2018) illustrates these concerns. It’s not unusual for experts to draw parallels between the survival of humanity and environmental protection. As a result, it is increasingly considered to be the collective responsibility of those businesses considered to be the most significant sources of environmental pollution, to reverse climate change by neutralising carbon emissions, adopting renewable energy sources and offering greener products.

Efforts to counter climate change

Industries like oil and gas, agriculture, manufacturing, transportation and construction, continue to emit several million gigagrams of hazardous carbon. These industries are the focus of international efforts to keep the increase in global average temperature below 2°C, as per the pre-industrial levels that scientists believe will substantially mitigate climate change. In theory, the objectives of 195 country signatories to the 2016 Paris Agreement are cascaded to domestic industry and firms in the frontlines of production with the goodwill to save the planet.

The key questions to ask here are:

  • What is my organisation’s carbon footprint?
  • How can we deliver greener products?


Shell. (2018). Shell energy transition report. Web link

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Managing Company Culture Whilst Responding to Environmental Challenges

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