GMAT Reading Comprehension
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Source: GWD
Level: 3
Eco efficiency (measures to minimize environmental impact through the reduction or elimination of waste from production processes) has become a goal for companies worldwide, with many realizing significant cost savings from such innovations. Peter Senge and Goran Carstedt see this development as laudable but suggest that simply adopting eco efficiency innovations could actually worsen environmental stresses in the future. Such innovations reduce production waste but do not alter the number of products manufactured nor the waste generated from their use and discard; indeed, most companies invest in eco efficiency improvements in order to increase profits and growth. Moreover, there is no guarantee that increased economic growth from eco efficiency will come in similarly eco efficient ways, since in today's global markets, greater profits may be turned into investment capital that could easily be reinvested in old-style eco-inefficient industries. Even a vastly more eco efficient industrial system could, were it to grow much larger, generate more total waste and destroy more habitat and species than would a smaller, less eco efficient economy. Senge and Carstedt argue that to preserve the global environment and sustain economic growth, businesses must develop a new systemic approach that reduces total material use and total accumulated waste. Focusing exclusively on eco efficiency, which offers a compelling business case according to established thinking, may distract companies from pursuing radically different products and business models.
The passage mentions which of the following as a possible consequence of companies' realization of greater profits through eco efficiency?
- A The companies may be able to sell a greater number of products by lowering prices.
- B The companies may be better able to attract investment capital in the global market.
- C The profits may be reinvested to increase economic growth through eco efficiency.
- D The profits may be used as investment capital for industries that are not eco efficient.
- E The profits may encourage companies to make further innovations in reducing production waste.