If equilibrium is compatible with both buyers' and sellers' intentions, how can it be undesirable?

Equilibrium can be undesirable because buyers and sellers are not the only people in society. Assume a group of people buy products from a factory. That factory dumps waste into the river nearby and pumps pollutants into the air. People living near the factory are adversely affected by the factory and may or may not be buyers of the factory's products. This is called a negative externality. The problem is that sellers pay attention to their costs but not to the costs to society. While marginal private benefit is equal to marginal private cost, marginal social costs are greater than marginal benefits at the equilibrium. Buyers and sellers are not the only people that matter.