A negative externality sink is an economics term that refers to a mechanism or system designed to absorb, reduce, or mitigate the negative externalities associated with certain activities. This could be through the implementation of environmental regulations, technological advancements, or other means to address and mitigate the harmful effects on third parties caused by negative externalities.
In regard to business and environmentalism, a negative externality sink is an activity which reduces the negative externalities caused by business operations. The most important of which include:
- Biodiversity loss – there has been a 68% average decline in the population sizes of mammals, birds, amphibians, reptiles, and fish between 1970 and 2016.
- Nitrogen cycle – ammonia factories (used for water purification, plastics, fabrics, pesticides and dyes) supplement the enzymatic magic of microbial nitrogen fixation with the brute forces of temperature and pressure, extracting close to 100 million metric tons of nitrogen from the atmosphere each year. This results in the creation of Nitrous Oxide which is 200 times more potent as a greenhouse gas than CO2.
- Deforestation – more than half the world’s tropical forests have been destroyed since the 1960s.
- Ocean acidification – more CO2 in the atmosphere means more acidity in the oceans.
- Microplastics via overconsumption – posing a significant threat to the environment, including the wildlife and the ecosystem as a whole.
- Climate change – since records began in 1880, nineteen of the twenty hottest years have occurred since 2000[7].
- Ozone depletion, the phosphorus cycle…