GREEN BUSINESS PRACTICES AND ORGANIZATIONAL SUSTAINABILITY (A STUDY OF LAFARGE AFRICA PLC)

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

Sustainability, in the organisational context, is generally understood as development that meets the needs of the present without compromising the ability of future generations to meet their own needs, a definition that has shaped decades of corporate environmental thinking since it was first articulated by the World Commission on Environment and Development (1987). Building on this idea, Elkington (1997) introduced the concept of the triple bottom line, which holds that organisations should evaluate their performance not only in financial terms but also in terms of their environmental and social impact. Green business practices refer to the specific operational actions, such as energy efficiency, waste reduction, use of alternative fuels, emissions reduction and eco-friendly product design, through which firms pursue this broader sustainability agenda.

The cement manufacturing industry is among the most energy- and carbon-intensive sectors globally, making it a natural focus for research on green business practices and organisational sustainability. Cement producers face mounting pressure from regulators, investors and communities to reduce their environmental footprint while maintaining profitability and production capacity, a tension that makes the sector a particularly rich context for examining whether green business practices translate into genuine organisational sustainability outcomes.

Lafarge Africa Plc, a member of the global Holcim Group and one of Nigeria's leading cement manufacturers, has positioned itself as a leader in sustainable cement production in the Nigerian market. The company describes its sustainable development approach as being driven by a commitment to the triple bottom line and reports that it was the first Nigerian cement company to be recognised as a Responsibility and Sustainability Company by Forbes Africa (Lafarge Africa Plc, 2019). In pursuit of this positioning, the company has introduced an eco-friendly cement brand under its Lafarge UniCem product line, reporting a 30 percent lower carbon footprint compared to the local industry standard, while also increasing its use of alternative fuels, including industrial and agricultural waste, tyre chips and biomass, to power its cement kilns, achieving a global Thermal Substitution Rate of approximately 9.4 percent in 2021, up from 9.3 percent in 2020 (Lafarge Africa Plc, 2023). More recently, the company has partnered with the Lagos Business School Sustainability Centre to explore the application of artificial intelligence in advancing energy efficiency, raw material optimisation and carbon capture within its operations.

Empirical evidence from within Nigeria's manufacturing sector supports the relevance of these practices. Okah and Obialor (2023) found a significant relationship between sustainable business practices and the operational sustainability of manufacturing firms in South-West Nigeria, reinforcing the argument that green business practices are not merely symbolic but can meaningfully influence organisational sustainability outcomes when properly implemented. At the same time, community-level studies around cement production sites have raised questions about the gap between corporate sustainability communication and lived environmental and socio-economic experience, underscoring the need for a closer, firm-specific examination of how Lafarge Africa's green business practices relate to its broader organisational sustainability, which this study undertakes.

1.2 Statement of the Problem

Despite Lafarge Africa Plc's publicised investment in eco-friendly cement production, alternative fuel use and sustainability partnerships, cement manufacturing remains an inherently resource- and emissions-intensive activity, and questions persist regarding the extent to which such green business practices produce measurable organisational sustainability outcomes rather than serving primarily as corporate communication. Studies examining communities located near cement production sites have documented continuing environmental and socio-economic concerns despite corporate social responsibility interventions, suggesting a potential gap between the sustainability practices a firm reports and the sustainability outcomes experienced by its immediate environment.

While broader Nigerian manufacturing studies, such as that of Okah and Obialor (2023), have established a link between sustainable business practices and operational sustainability, there is limited firm-specific empirical evidence examining how the individual components of Lafarge Africa's green business practices, namely environmental resource management, alternative energy and fuel use, eco-product innovation, and community and stakeholder engagement, relate to organisational sustainability outcomes. It is this gap that the present study seeks to address.

1.3 Objectives of the Study

The general objective of this study is to examine the effect of green business practices on organisational sustainability at Lafarge Africa Plc. The specific objectives are to:

1. examine the effect of environmental resource management practices on organisational sustainability at Lafarge Africa Plc;

2. assess the influence of alternative energy and fuel use on organisational sustainability at Lafarge Africa Plc;

3. evaluate the effect of eco-friendly product innovation on organisational sustainability at Lafarge Africa Plc;

4. determine the effect of community and stakeholder engagement practices on organisational sustainability at Lafarge Africa Plc; and

5. identify the challenges Lafarge Africa Plc faces in implementing green business practices.

1.4 Research Questions

The study seeks to answer the following questions:

1. What effect do environmental resource management practices have on organisational sustainability at Lafarge Africa Plc?

2. How does alternative energy and fuel use influence organisational sustainability at Lafarge Africa Plc?

3. What effect does eco-friendly product innovation have on organisational sustainability at Lafarge Africa Plc?

4. What effect do community and stakeholder engagement practices have on organisational sustainability at Lafarge Africa Plc?

5. What challenges does Lafarge Africa Plc face in implementing green business practices?

1.5 Research Hypotheses

The following null hypotheses were formulated to guide the study:

1. H01: Environmental resource management practices have no significant effect on organisational sustainability at Lafarge Africa Plc.

2. H02: Alternative energy and fuel use has no significant influence on organisational sustainability at Lafarge Africa Plc.

3. H03: Eco-friendly product innovation has no significant effect on organisational sustainability at Lafarge Africa Plc.

4. H04: Community and stakeholder engagement practices have no significant effect on organisational sustainability at Lafarge Africa Plc.

1.6 Significance of the Study

This study is significant to the management of Lafarge Africa Plc, as it offers evidence-based insight into which green business practices most strongly contribute to organisational sustainability, supporting more targeted sustainability investment. It is also relevant to other cement and manufacturing firms in Nigeria seeking to strengthen their own sustainability strategies.

Host communities and environmental regulators may find the findings useful in evaluating the real-world impact of corporate green business practices. Academically, the study contributes to the growing body of Nigerian literature on green business practices and organisational sustainability and provides a reference point for students and future researchers examining similar issues within the cement and broader manufacturing industries.

1.7 Scope of the Study

The study focuses on Lafarge Africa Plc and examines the green business practices of environmental resource management, alternative energy and fuel use, eco-friendly product innovation, and community and stakeholder engagement, and their relationship with organisational sustainability. The study draws on the perspectives of management and staff within the company's operations, with reference to its Nigerian production facilities, and considers developments over approximately the last five years.

1.8 Limitations of the Study

Access to certain proprietary environmental performance data of Lafarge Africa Plc was not available, limiting the study to information obtainable from staff responses, published sustainability reports and secondary literature, which may reflect a degree of corporate self-reporting bias. As a single-firm case study, the findings may not be fully generalisable to other cement manufacturers operating under different regulatory or community conditions. Time and resource constraints further limited the scope of primary data collection.

1.9 Definition of Terms

Green Business Practices: operational actions taken by a firm, such as energy efficiency, waste reduction and alternative fuel use, aimed at reducing its environmental impact.

Organisational Sustainability: an organisation's capacity to meet its present economic, environmental and social objectives without compromising its ability to do so in the future.

Triple Bottom Line: a sustainability framework that evaluates organisational performance across financial, environmental and social dimensions (Elkington, 1997).

Carbon Footprint: the total amount of greenhouse gases generated by an organisation's activities, typically expressed in carbon dioxide equivalents.

Thermal Substitution Rate: the proportion of a cement plant's kiln energy requirement met by alternative fuels rather than conventional fossil fuels.

Corporate Social Responsibility: the practices through which a company manages its social, environmental and economic impact on stakeholders and society.

REFERENCES

Elkington, J. (1997). Cannibals with forks: The triple bottom line of 21st century business. Capstone.

Lafarge Africa Plc. (2019). 2019 sustainability report: Driving sustainable innovation. Lafarge Africa.

Lafarge Africa Plc. (2023, June 20). Lafarge leads production of eco-friendly cement in Nigeria. Lafarge Africa. https://www.lafarge.com.ng/lafarge-leads-production-eco-friendly-cement-nigeria

Okah, V., & Obialor, D. C. (2023). Sustainable business practices and operational sustainability of manufacturing firms in South-West, Nigeria. Journal of Management and Corporate Sustainability.

Porter, M. E., & Kramer, M. R. (2006). Strategy and society: The link between competitive advantage and corporate social responsibility. Harvard Business Review, 84(12), 78–92.

World Commission on Environment and Development. (1987). Our common future. Oxford University Press.