Page 408 - Design for Environment A Guide to Sustainable Product Development

Glossary 383

Return on net assets (RONA) A measure of a corporation’s profitability
determined by dividing net income for the past 12 months by total average
assets minus total liabilities, i.e., net worth.
Risk (1) The presence of uncertainty in a business or other activity.
(2) The possibility of an adverse incident due to the presence of hazards.

Risk management The process of identifying and evaluating risks and
selecting and managing techniques to adapt to risk exposures.
Screened investing The application of social and environmental criteria to
evaluate conventional investments, such as stocks, bonds, and mutual funds.
Servicization An innovation strategy that shifts the business focus from
designing and selling physical products to selling a system of products and
services that fulfill customer needs.
Shareholder resolution A recommendation or requirement, proposed by a
shareholder, that a company and/or its board of directors take action
presented for a vote at the company’s general shareholders’ meeting.
Shareholder value The economic market value that a shareholder would
realize from liquidation of their equity.

Socially responsible investing The incorporation of an investor’s social,
ethical, or religious criteria in the investment decision-making process.
Solvents Solvents are liquids (e.g., acetone) capable of dissolving or dis -
persing other substances, used in manufacturing and consumer cleaning
applications. Solvents can have adverse effects on human health and
atmospheric pollution (see VOCs).
Stakeholder (1) A person or group that has an investment, share, or interest in
something, as a business or industry. (2) Any party that has an interest, finan -
cial or otherwise, in a firm, including shareholders, creditors, employees,
customers, suppliers, communities, interest groups, and the government.
Stakeholder engagement Deliberate outreach on the part of a corporation in
order to engage in dialogue and develop relationships with stakeholders.

Strategy A set of goals and aspirations combined with a comprehensive
action plan for achieving those goals.
Supply chain A sequence of suppliers and customers that add value in the
form of materials, components, or services, ultimately resulting in a final
product. For products with multiple inputs, supply chains are actually
networks.
Sustainability Conformance with principles of sustainable development,
encompassing the environmental, health and safety, social, economic, and
ethical aspects of a corporation or other entity.
Sustainable business A business that is able to anticipate and meet the
economic, environmental, and social needs of present and future generations
of customers and other stakeholders.