ABSTRACT
This chapter presents the corporate and environmental strategy implications of capital investment decisions and a framework for improving the corporate capital investment decision-making process. It examines methods that can be used to improve measurement of the environmental costs and benefits to both the company and society and how to integrate those impacts into capital investment decisions for regulatory environmental projects, voluntary environmental projects and general capital projects. Life-cycle assessment provides managers with a more complete picture of the environmental impacts linked to a particular product or process, beyond those evident in the manufacturing stage. The strategic nature of the environmental challenge is indeed firmly grounded in the management literature. The chapter describes how the environmental pressures can endanger and reshape a firm's competitive basis and how a firm needs to develop new skills and knowledge. Strategic decisions will also impact the range of environmental responses considered by the firm.
