eCommerce and Its Environmental Effects

eCommerce and Its Environmental Effects

eCommerce plays a big role in the internet economy. It is a significant part of ebusiness, which also includes video teleworking and conferencing. Are you thinking of leveling up your business, and offering new ecommerce web solutions in Malaysia? Then, you should learn more about it.

eBusiness can be defined as follows: commercial activities, business processes, and other economic tasks. eBusiness processes are implemented by utilizing ICT applications and equipment. Together with ecommerce, it is a component of ICT use. 

Among the many definitions of ecommerce, that of OECD is the most popular, simply because it has been agreed on by many member countries. Its definition is operational, meaning it has been utilized as a basis of indicators and statistics. OECD delivers both broad and narrow ecommerce definitions.

eCommerce: Narrow Definition

An online transaction is the purchase or sale of services or goods, whether between public organizations, private firms, governments, individuals, households or business over the internet. The services and goods are ordered online. However, the payment and delivery may be implemented offline or online. 

eCommerce: Broad Definition

An electronic transaction is the purchase or sale of services and goods, whether between private organizations, public firms, governments, households, individuals or businesses, executed through computer-mediated networks. Services and goods are ordered with the help of those networks. However, the payment and shipping may be implemented offline or online.

Here are the environmental effects of ecommerce, based on OECD’s ecommerce’s broad definition. It describes the methods for sustainable business strategies in the digital landscape.  

The Environmental Effects of eCommerce

  • The First-Order Effects

eCommerce presupposes ICT infrastructure availability (routers, servers, mobile phones, PCs, etc.) The use and production of ICT infrastructures can cause material flows, use of hazardous substances, and eventually lead to electronic waste and energy consumption.

  • The Second-Order Effects

eCommerce is rapidly transforming economic markets and processes. Virtual business networks, emarkets, and product and service digitization entail many environmental consequences. This can impact land use, transportation and resource productivity. The effects can be either damaging or beneficial to the environment.

  • The Third-order effects

eCommerce can cause major structural change to the economy, impacting consumption patterns and lifestyles. These things, in turn, affect the environment. If efficiency rate improvements are lower compared to the consumption growth rates, then a so-called rebound effect would take place.