Our economic prosperity is driven by Corporates and Businesses. Each day we see hundreds of new businesses built. But the question is, are they sustainable? Wait, but do we know the real meaning of Sustainable Business?
In the past, revenue and profit were the only key accounting measures of many organizations. Companies would design their business strategies with the sole goal to increase the shareholder value. This meant putting money ahead of the people, environment, and society. Companies would mindlessly exploit natural resources at a cost of earning short term profit without even thinking of the long term consequences their actions would bear to the society.
But now, the rules of the game are changed!
Stringent environmental regulations, Global pressure to reduce negative environmental footprint, and changing consumer mindset because of increased awareness are few of the many reasons organizations have shifted to a more holistic way of performance measurement. Organizations have increasingly accepted ‘The Triple Bottom Line’ approach to business performance measurement, stressing equally on People, Planet, and Profit.
Corporate Sustainability lies at the intersection of value creation for People, Planet, and Profit (The three equally important stakeholders). Only the corporates whose strategy formulation and implementation aim to achieve value maximization for all the three stakeholders can be termed as Sustainable Businesses. In simple words, sustainable business growth/development is employing business strategies and practices that in no way harm the environment and its natural resources create social value for the society by creating employment and generates economic output in terms of profits for the economy.
In this article, we will focus on the environmental stakeholders and what small and simple things that organizations can do to reduce their negative environmental footprint.
Research suggests a positive correlation between Environmental Sustainability and growth in terms of increased consumer base[i]. Consumers who are conscious and educated are more likely to choose your products or do business with you if you are environment friendly. Ethically, irrespective of what the business functions, it is important to stay considerate of the planet and return the favor. Being a sustainable business also speaks about how much does the business care thus increasing customer and employee trust.
Here are a few simple ways you could help your business become sustainable and eco-friendly
It’s time to Reduce and Renew
Simple steps like switching off the lights and fans in your offices when not in use get the job done. Use CFL bulbs instead of regular fluorescent bulbs, turn off the taps in washrooms, and use electricity only when required. Opt for office spaces that are sustainable (increasingly many IT and Business Parks are employing sustainable practices of Rain Water Harvesting and Solar Powered Energy). These simple practices are not only eco-friendly but also save you the overhead cost.
In the longer run, incorporating such practices will make you a greener and sustainable brand. It will help you enhance your brand image and give you a sustained competitive advantage.
Work along-side your employees.
Coming up with sustainable ideas can be taxing. So it is important to make sustainability at workplaces a two-way street by engaging your employees. A great way to keep employees motivated towards is to engage and incentivize them for the steps taken by them. It encourages them to adapt to an overall green and sustainable lifestyle not just at workplaces.
To make it more interesting, a healthy competition could be set-up between departments. Challenging them to reduce their waste, carbon footprint, etc., the winner could get more benefits and incentives. It would encourage the entire organization to better their lifestyle, and at the same time, build a healthy work culture.
For example, Facebook offers incentives up to $10,000 if their employees move in within 10 miles or more, thus shortening their commute and carbon footprint[ii].
Take Sustainability beyond CSR activities
A great way to become a sustainable business is to completely incorporate sustainability as a part of your business strategy. To be truly sustainable, it is essential to go beyond what is expected by the government through CSR activities. Being a sustainable business, you would be setting examples for a generation of consumers.
Partner with NPO’s and NGO’s and get involved in community services and volunteering. Keeping a check on your waste and following stringent waste management practices could improve the way consumers/customers look at the organization. It portrays the image of a responsible organization. Research suggests that employees drive more job satisfaction by associating themselves with a responsible organization.
Unilever incorporated sustainability as a part of its business strategy through The Unilever Sustainable Living Plan. The Unilever Sustainable Living Plan sets out to decouple our growth from our environmental footprint, while increasing our positive social impact[iii].
IKEA started using ocean-bound plastics to make its products, hence recycling and reducing pollution[iv].
Sustainable Supply Chain
Maintain a set of trusted vendors and make it a point to do business with vendors/clients that are environment friendly in their business practice. Use sustainability as a way to drive down the cost in supply chain operations and increase profitability.
IKEA is a globally renowned brand that is sustainable throughout its business operation. It mainly starts with its supply chain. They source their wood and cotton from sustainable foresters that mandate reduced use of water, pesticides, and energy. IKEA also has around 700000 solar panels powering its stores worldwide. It aims to go 100% green and sustainable by the end of 2020[v].
These are a few, yet important ways to make your business a sustainable business and thus driving your company’s a great transformation.