6 Benefits of Becoming a Sustainable Business Six years ago, I published an article exploring the idea that sustainability confers benefits to companies beyond the “save the world” good feeling it engenders.
My article argued that sustainability can also be a major differentiator in terms of brand image and competitive advantage.
Since then, it has become increasingly clear that I was right on track. Consumers have gravitated en masse toward sustainability, and the business benefits suggested by Rogers continue to be of utmost importance to organizations.
A recent study showed that US companies are encountering significant, long-term consequences — including lost sales — for not proactively addressing the climate crisis.
1. Improved brand image and competitive advantage.
Surveying U.S. consumers, the Natural Marketing Institute found that a majority of them take a company’s environmental impact into consideration when deciding where to shop. Consumers are more likely to purchase from businesses that adopt sustainable practices.
There are 68 million Americans who are more likely to do business with companies that have a positive track record when it comes to personal, social, and environmental values. The Cause Marketing Forum reports that consumers also favor companies that actively support their communities. In other words, businesses do well by doing good.
Brand awareness can be greatly improved by simply “doing good.” A great example of this is Colgate’s public awareness ads during the Super Bowl, which promoted water conservation. By advertising their brand in this way, Colgate not only helped to improve the environment, but also gained a lot of goodwill among consumers.
2. Increase productivity and reduce costs.
Streamlining company efforts and conserving resources are at the heart of sustainable business practices. These practices often come under fire from those who see them as reducing corporate profits. However, sustainable business practices actually lead to more efficient operations, which in turn enhances employee productivity and reduces costs.
Reducing cost also encompasses energy conservation strategies that can be as simple as turning off unnecessary lights and insulating walls to more sophisticated efforts such as installation of geothermal heating and cooling systems. However, the more significant changes will require a greater investment, but the long-term results justify the cost.
3. Increase business ability to comply with regulation.
With more and more discussion about climate change, energy resources, and environmental impact, state and federal government agencies are enacting stricter regulations to protect the environment. If your business integrates sustainability, it will be able to meet these changing regulations in a timely manner.
4. Attract employees and investors.
Young people these days are really conscientious about the environment and social issues. They want to make sure that they’re supporting companies that share their values, and they don’t want to be associated with companies that have been involved in ecological disasters or social welfare scandals.
Your company’s public perception has a lot to do with how successful it will be in attracting top talent and investment capital. By emphasizing your company’s commitment to being environmentally responsible and taking care of its employees, you can make your business more attractive to the kinds of people and organizations you want to be involved with.
5. Reduce waste.
Recycling is one of the easiest sustainable practices to adopt in the workplace. It begins with small things, like collecting empty cans and bottles, and has grown to encompass waste mitigation in paper products. This effort conserves trees and forest habitats.
The workplace presents many opportunities for recycling, which is an easy sustainable practice to adopt. It starts with collecting cans and bottles, and has progressed to include waste reduction in paper products. This effort conserves trees and forests.
6. Make shareholders happy.
Many people think that sustainability is only important for large companies, but sustainable practices can actually be used to increase profits for businesses of any size. In their 2014 report “Profits with Purpose: How Organizing for Sustainability Can Benefit the Bottom Line,” McKinsey researched 40 companies to understand sustainability challenges and make recommendations for how businesses can “capture value from sustainability.”
A study by Deutsche Bank found that companies with strong environmental, social, and governance practices outperformed the market in both the short and long term.
The investment firm McKinsey did a study which found that the companies who practice sustainability make more money than those who don’t. This is also backed up by the Carbon Disclosure Project. They looked at how share prices increased over time and found that from 1993-2010, companies who focused on sustainability made an increase of $22.60, while others only made $15.
The notion that anything easy can’t be rewarding applies to sustainability. It requires devotion, allegiance, and tenacity from high-level executives to frontline staff to buy into the idea of sustainability and make it a success. Nevertheless, if your business can make it work,
When morale and productivity improve, it benefits everyone involved. Sales increase and costs decrease, which is great for the shareholders and consumers. But it also benefits the employees, who feel more valued and motivated in their work. It’s the ultimate win-win situation.
Author – Michael Rogers
Michael Rogers is the Operations Director of USInsuranceAgents.com. He has over 5 years of experience and knowledge in the insurance industry, and he contributes his level of expertise as a leader and an agent to educate and secure coverage for thousands of clients.
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